Competition Commission facilitates switching of supplier in domestic bulk LPG market

On 29 June 2006 the Competition Commission (CC) published its final report into the domestic bulk LPG market, following a market investigation into the sector.

The CC’s report found there is an adverse effect on competition in the supply of domestic bulk LPG. As a result measures will be introduced to make it easier for customers to switch supplier.

These measures focus on:

• Facilitating tank transfers – measures include giving the incoming supplier the right to buy the existing tank from the outgoing supplier;
• Standardising and improving information on the switching process – measures include an obligation on suppliers to effect switches within 42 days;
• Changing customer contracts – measures include capping customers’ notice periods for switching at 42 days;
• Better provision of information on suppliers and their offers – measures include making more information on different suppliers available via trade associations (through websites or telephone lines) and allowing suppliers to send “wake up” letters informing customers when they will be or are free to switch supplier.

The measures are expected to be introduced by statutory instrument towards the end of 2006, with a transition period of up to 9 months. LPG suppliers should familiarise themselves with the proposals in order to be fully prepared for their impact.

For further details on the CC’s proposed remedies, please click here.