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Petroleum Products Pricing Act

Legislature :
55
Session :
3
Bill No. :
82
Member :
Hon. Fowlie
First Reading :
2006-6-15
Second Reading :
2006-6-16
Committee of the Whole :
2006-6-21
Amended :
2006-6-21
Third Reading :
2006-6-21
Royal Assent :
2006-6-22
Download PDF :
Bill 82

Text of Bill :
Chapter Outline



Definitions

Definitions......................................................................................................................................... 1

Board — Commission

consumer — consommateur

delivery costs — coûts de livraison

heating fuel — combustible de chauffage

Minister — ministre

motor fuel — carburant auto

outlet — point de vente

petroleum product — produit pétrolier

price — prix

retailer — détaillant

wholesaler — grossiste

Exemption.......................................................................................................................................... 2

Maximum prices and margins........................................................................................................... 3

Components of the maximum price................................................................................................. 4

Maximum delivery costs................................................................................................................... 5

Disclosure of price............................................................................................................................ 6

Display of prices................................................................................................................................ 7

Promotional activities....................................................................................................................... 8

Prohibitions........................................................................................................................................ 9

Benchmark prices............................................................................................................................ 10

Adjusting benchmark prices........................................................................................................... 11

Adjusting margins............................................................................................................................ 12

Adjusting delivery costs.................................................................................................................. 13

Review by Board.............................................................................................................................. 14

Price change due to taxation........................................................................................................... 15

Confidentiality................................................................................................................................. 16

Complaint hearing........................................................................................................................... 17

Powers of Board and members...................................................................................................... 18

Engagement of experts.................................................................................................................... 19

Admissibility of evidence............................................................................................................... 20

Investigation into prices and delivery costs.................................................................................. 21

Procedure......................................................................................................................................... 22

Contempt.......................................................................................................................................... 23

Inspections....................................................................................................................................... 24

Cost of hearings............................................................................................................................... 25

Regulatory charges.......................................................................................................................... 26

Start-up costs................................................................................................................................... 27

Recovery of costs, levies, assessments......................................................................................... 28

Offences........................................................................................................................................... 29

Continuing offence.......................................................................................................................... 30

Contract may not exclude application of orders........................................................................... 31

Administration of Act..................................................................................................................... 32

Regulations...................................................................................................................................... 33

Repeal............................................................................................................................................... 34

Commencement............................................................................................................................... 35

Schedule A





Her Majesty, by and with the advice and consent of the Legislative Assembly of New Brunswick, enacts as follows:



Definitions

1                           The following definitions apply in this Act.



"Board" means the Board of Commissioners of Public Utilities constituted under the Public Utilities Act. (Commission)



"consumer" means a person who acquires a petroleum product for that person's use and not for the purpose of selling, exchanging or otherwise disposing of it to another person, but does not include a person who acquires a petroleum product under a contract between the person and a retailer or wholesaler at a price that the person and the retailer or wholesaler have previously agreed on. (consommateur)



"delivery costs" means



(a)               with respect to motor fuel, the costs of delivering the fuel within the Province from a site used by a wholesaler to an outlet used by a retailer, and



(b)               with respect to heating fuel, the costs of delivering the fuel within the Province from a site used by a wholesaler to the consumer. (coûts de livraison)



"heating fuel" means furnace oil or propane of a type used primarily for generating heat and includes any other liquid product, whether or not distilled from petroleum, used as a heating fuel or as a component in it. (combustible de chauffage)



"Minister" means the Minister of Energy. (ministre)



"motor fuel" means gasoline or diesel fuel of a type used primarily in internal combustion engines and includes any other liquid product, whether or not distilled from petroleum, used as a motor fuel or as a component in it. (carburant auto)



"outlet" means a station, shop, establishment or other place where a petroleum product is sold at retail or kept for retail sale. (point de vente)



"petroleum product" means heating fuel and motor fuel. (produit pétrolier)



"price" means the consideration, whether wholly or partly in money or otherwise, payable for a petroleum product and includes any component of the consideration. (prix)



"retailer" means a person who sells a petroleum product or keeps a petroleum product for sale directly to consumers. (détaillant)



"wholesaler" means a person, other than a retailer, who sells a petroleum product or keeps a petroleum product for sale. (grossiste)



Exemption

2                           This Act does not apply to a wholesaler in relation to the sale by the wholesaler of a petroleum product to a person who is not a retailer or the keeping of a petroleum product by the wholesaler for sale to a person who is not a retailer.



Maximum prices and margins

3(1)                   The Board has authority



(a)               to set, and shall set the maximum wholesale and retail prices that a wholesaler and a retailer may charge for petroleum products, and



(b)               to set, and shall set the maximum margin between the wholesale price to the retailer and the retail price to the consumer of petroleum products.



3(2)                   Notwithstanding subsection (1), the Minister shall set the initial maximum prices and the initial maximum margins referred to in subsection (1) and shall specify the date on which they are to be effective, and thereafter the Board shall act under subsection (1).



3(3)                   The Minister or the Board, as the case may be, shall ensure that all wholesalers are informed of the maximum prices and margins before they are to take effect.



3(4)                   A wholesaler shall ensure that any retailer to whom it sells petroleum products is informed of any price change before it takes effect.



Components of the maximum price

4(1)                   For each type of heating fuel and motor fuel, the maximum wholesale price shall be the sum of



(a)               the benchmark price, as established or adjusted pursuant to sections 10 and 11,



(b)               the maximum wholesale margin, and



(c)               applicable taxation.



4(2)                   For each type of heating fuel and motor fuel, the maximum retail price shall be the sum of



(a)               the benchmark price, as established or adjusted pursuant to sections 10 and 11,



(b)               the total allowed margin, which is comprised of the maximum margin for a wholesaler and the maximum margin for a retailer, and



(c)               applicable taxation.



4(3)                   Delivery costs do not form any part of any margin under this section.



4(4)                   Notwithstanding that a maximum margin is set for a wholesaler and a retailer, if the wholesaler and the retailer agree in writing, they may apportion the total allowed margin between them in such manner as they see fit.



Maximum delivery costs

5(1)                   The Board has authority to set, and shall set the maximum delivery costs that may be charged by a wholesaler to a retailer for the delivery of a type motor fuel or by a retailer to a consumer for the delivery of a type of heating fuel,



(a)               within the province, other than the parish of Grand Manan, and



(b)               in the parish of Grand Manan.



5(2)                   Notwithstanding subsection (1), the Minister shall set the initial maximum delivery costs under subsection (1), and shall specify the date on which they are effective, and such maximum remains in effect until the Board changes it.



5(3)                   The Minister or the Board, as the case may be, shall ensure that all wholesalers are advised of the maximum delivery costs before they are to take effect.



5(4)                   A wholesaler shall ensure that



(a)               any retailer to whom it delivers motor fuel is informed of the maximum delivery cost before it takes effect, and



(b)               the delivery cost charged by the wholesaler to the retailer is stated separately on the invoice provided to the retailer.



5(5)                   Notwithstanding subsection (1), any retailer or wholesaler may apply to the Board under section 13 to have a different maximum delivery cost apply in his or her particular circumstances.



Disclosure of price

6                           Unless authorized by the Board or under this Act, a wholesaler or retailer shall not disclose to any other person a price set by the Minister or the Board before the date on which the price comes into effect.



Display of prices

7(1)                   A retailer shall display to the public, in accordance with the regulations, if any, at every place at which the retailer sells or offers to sell motor fuel to a consumer, the price for the type of motor fuel.



7(2)                   The price under subsection (1) shall include any delivery costs paid by the retailer to the wholesaler for the delivery of that fuel.



7(3)                   A retailer who delivers heating fuel to a consumer shall ensure that the invoice provided to the consumer shows the following information as separate items:



(a)               the price of the fuel;



(b)               the delivery costs charged to the consumer;



(c)               any special delivery charges incurred, other than those under (a) and (b), by the consumer in having the fuel delivered.



7(4)                   A retailer who delivers heating fuel to a consumer shall inform the consumer of any special delivery charges under paragraph (3)(c) before delivering the fuel.



Promotional activities

8                           No wholesaler shall claim or recover in any manner, directly or indirectly, from a retailer the cost or any portion of the cost of a promotional activity, involving the sale or giving of merchandise, that is sponsored by the wholesaler.



Prohibitions

9(1)                   Unless a wholesaler has an agreement with a retailer under subsection 4(4), the wholesaler shall not charge a price for heating fuel or motor fuel greater than the maximum price for wholesalers set by the Minister or the Board, as the case may be.



9(2)                   A retailer shall not charge a price for heating fuel or motor fuel greater than the maximum price for retailers set by the Minister or the Board, as the case may be.



9(3)                   A wholesaler shall not charge a retailer an amount for delivery costs for delivering motor fuel that exceeds the lesser of



(a)               the actual costs incurred by the wholesaler, or



(b)               the maximum delivery costs set by the Minister or the Board, as the case may be.



9(4)                   A retailer shall not charge a consumer more for delivery costs for motor fuel than the retailer was charged by the wholesaler for the delivery of the fuel.



9(5)                   A retailer shall not charge a consumer for delivery costs for heating fuel more than the maximum delivery costs set by the Board.



Benchmark prices

10(1)               The Board shall establish the benchmark price for each type of heating fuel and motor fuel, using the criteria and procedure prescribed by regulation.



10(2)               Notwithstanding subsection (1), the Minister shall establish the initial benchmark price, using the criteria and procedure prescribed by regulation, and thereafter the Board shall act under subsection (1).



Adjusting benchmark prices

11                        The Board shall adjust the benchmark price for each type of heating fuel and motor fuel sold by a wholesaler and a retailer, using the criteria and procedure prescribed by regulation.



Adjusting margins

12(1)               A wholesaler or a retailer may apply to the Board for a change in the maximum margin that may be charged by a wholesaler or retailer for a type of heating fuel or motor fuel.



12(2)               An application under subsection (1) shall set out the following:



(a)               the proposed change in the margin and the date on which it is proposed the change take effect;



(b)               the reasons for the proposed change in price; and



(c)               the other information that may be required by the Board or by regulation with respect to the application.



12(3)               The onus is on the applicant to show that the proposed change in the maximum margin is justified.



12(4)               The Board, following the investigation the Board considers necessary, including the holding of a hearing where the Board considers one is desirable, may



(a)               deny the application,



(b)               approve the application, or



(c)               set another maximum margin that the Board considers appropriate in the circumstances.



12(5)               An adjustment of a maximum margin takes effect on the date set out in the order.



12(6)               Only one application may be made by any wholesaler or any retailer in a 12 month period.



Adjusting delivery costs

13(1)               A wholesaler or a retailer may make an application to the Board to adjust the maximum delivery costs that may be charged by the wholesaler or retailer, whether those costs are applicable generally or are specific to that applicant.



13(2)               An application under subsection (1) shall set out the following:



(a)               the proposed change in the maximum delivery costs and the date on which the proposed change is to take effect,



(b)               the reasons for the proposed change,



(c)               such other information that may be required by the Board or by regulation with respect to the application.



13(3)               The onus is on the applicant to show that the proposed change in the maximum delivery costs is justified.



13(4)               The Board, following the investigation the Board considers necessary, including the holding of a hearing where the Board considers one is desirable, may



(a)               deny the application,



(b)               approve the application, or



(c)               set other maximum delivery costs that the Board considers appropriate in the circumstances.



13(5)               A change ordered under subsection (4) takes effect on the date set out in the order.



Review by Board

14(1)               If there has been no application under section 12 in any 12 month period, the Board shall conduct a review of the maximum margins to ensure that they are just and reasonable.



14(2)               If there has been no application under section 13 in any 12 month period to adjust the maximum delivery costs that are generally applicable, the Board shall conduct a review of all maximum delivery costs to ensure that they are just and reasonable.



14(3)               The review shall take place within 30 days after the end of the 12 month period referred to in subsection (1) or (2).



14(4)               The Board may, on the request of a wholesaler or retailer or the Minister, review the suitability of the pricing mechanism referred to in sections 10 and 11 and shall provide the Minister with its recommendations respecting the mechanism.



Price change due to taxation

15                        Where a price change with respect to the wholesale and retail price of a petroleum product reflects a change in the price that is wholly attributable to changes in taxation, the Board shall be deemed to have issued an order approving the proposed price on the date on which the change in taxation is to be effective.



Confidentiality

16(1)               Where information obtained by the Board concerning the costs of a person in relation to the operations of the person that are regulated under this Act, or other information that is by its nature confidential, is obtained from such person in the course of performing its duties under this Act, or is made the subject of an inquiry by any party to any proceeding held under the provisions of this Act, such information shall not be published or revealed in such a manner as to be available for the use of any person unless in the opinion of the Board such publication or revelation is necessary in the public interest.



16(2)               Notwithstanding subsection (1), the Board shall provide information to the Minister that it has obtained under any reporting requirements provided for under the regulations, upon the written request of the Minister.



Complaint hearing

17(1)               The Board may hold a hearing in respect of a complaint made against a wholesaler or retailer and in that case shall notify the wholesaler or retailer as to the nature of the complaint and the time, date and place of the hearing.



17(2)               In a hearing under this section, the wholesaler or retailer and the complainant shall be entitled to be heard and witnesses shall be permitted to attend to give evidence.



Powers of Board and members

18(1)               The Board has all the powers, rights and privileges as are vested in The Court of Queen's Bench of New Brunswick in relation to the attendance, swearing and examination of witnesses, the production and inspection of documents, the enforcement of its orders, the entry on and inspection of property and other matters necessary or proper for the due exercise of its jurisdiction.



18(2)               The Chairman of the Board, or any member of the Board or other person designated by the Chairman, may administer oaths or affirmations, certify as to the official acts of the Board and issue summons to witness to compel the attendance of witnesses and the production of records and documents.



Engagement of experts

19(1)               The Chairman may engage the services of such professional, technical or other experts or other persons to advise it in any matter upon such terms and conditions as the Board considers appropriate.



19(2)               The Board may order by whom the fees and expenses of the persons so engaged shall be paid.



Admissibility of evidence

20                        The Board may receive in evidence any statement, document, record, information or thing that, in the opinion of the Board, is relevant to the matter before it, whether or not the statement, document, record, information or thing is given or produced under oath or would be admissible as evidence in a court of law.



Investigation into prices and delivery costs

21(1)               The Board may conduct an investigation to determine whether a price being charged by a wholesaler or a retailer for a petroleum product exceeds the maximum price set under this Act or whether the delivery costs being charged by a wholesaler or retailer exceed the delivery costs set under subsection 9(3), (4) or (5).



21(2)               When the Board as a result of an investigation conducted under subsection (1) believes that a wholesaler or a retailer has charged or is charging a price for a petroleum product that exceeds the maximum price or the wholesaler or retailer is charging in excess of the delivery costs set under subsection 9(3), (4) or (5), the Board shall order the wholesaler or retailer to sell or offer for sale the heating fuel or motor fuel at a price not to exceed the price set by the Board or not to charge delivery costs in excess of that set under subsection 9(3), (4) or (5).



Procedure

22                        The Board may inquire into, hear or determine any application, matter or thing that under this Act it may inquire into, hear or determine and in doing so, the Board



(a)               subject to the regulations, is the master of its own procedure and may give directions about process and procedure that it considers appropriate in the circumstances, and



(b)               may request from anyone and require anyone to gather evidence or to prepare studies relevant and incidental to the matter over which it is exercising its jurisdiction.



Contempt

23                        On application to The Court of Queen's Bench of New Brunswick by the Board, the failure or refusal of a person to attend, to take an oath, to participate in a hearing, to answer questions or to produce documents or any other thing in the custody, possession or control of the person, to permit entry upon and inspection of property or records or documents under the possession or control of the person or to obey an order of the Board, as the case may be, makes the person liable to be committed for contempt as if in breach of an order or judgment of The Court of Queen's Bench of New Brunswick.



Inspections

24(1)               For the purpose of ensuring compliance with this Act and the regulations, the Board may, in writing, authorize a person to conduct an inspection under this section and that person may enter the premises of a wholesaler or retailer of petroleum products at reasonable times



(a)               to determine whether



(i)         the prices being charged by the wholesaler or retailer for petroleum products exceed the maximum prices set by the Board,



(ii)       the delivery costs being charged by a wholesaler to a retailer or by a retailer to a consumer for the delivery of motor fuel exceeds the delivery costs set under subsection 9(3) or (4), or



(iii)    the delivery costs charged by a retailer to a consumer for heating fuel exceeds the delivery costs set under subsection 9(5),



(b)               to require the production of books, records or other documents applicable to the sale and delivery of heating fuel or motor fuel and to examine those books, records or documents or remove them for the purpose of making copies of them, and



(c)               to inquire into all matters relating to the sale by the wholesaler or retailer of heating fuel or motor fuel.



24(2)               Where a person authorized by the Board under subsection (1) removes books, records or other documents under paragraph (1)(b), he or she shall give to the person from whom those items were taken a receipt for those items and shall make copies of those items and return the originals to the person who was given the receipt without delay.



24(3)               No person shall obstruct a person who is authorized by the Board to act under subsection (1) and who is carrying out or attempting to carry out an inspection under subsection (1), or withhold or destroy or conceal or refuse to furnish any information or thing required by the person authorized for the purposes of the inspection.



24(4)               No person shall knowingly make a false or misleading statement, either orally or in writing, to a person authorized by the Board to act under subsection (1) while that person is engaged in carrying out his or her duties under this Act or the regulations.



Cost of hearings

25                        An applicant to the Board for a change to the maximum margin or a change to the maximum delivery costs shall pay the full costs of any hearing, as assessed by the Board and within the period determined by the Board.



Regulatory charges

26(1)               Each wholesaler as defined in the Gasoline and Motive Fuel Tax Act shall pay annually to the Board the levy prescribed by regulation for the purposes of defraying the Board's expenses under this Act.



26(2)               The levy shall be based on the volume of gasoline and motive fuel, as defined under the Gasoline and Motive Fuel Tax Act, or such of those products as are designated by regulation, whether or not the product is subject to regulation under this Act, that is sold by a wholesaler, as defined in the Gasoline and Motive Fuel Tax Act.



Start-up costs

27(1)               In this section, "start-up costs" means those expenses the Board incurs between the coming into force of this section and March 31, 2007, and which, in its opinion, it would not normally incur once this Act has been in force for a reasonable time.



27(2)               The Board may recover its start-up costs by assessing wholesalers directly over the period it shall determine and shall notify each wholesaler by registered mail of the amount so assessed upon it.



27(3)               A wholesaler shall, on receipt of a notice under this section, pay the assessed amount to the Board within 30 days after the posting of the notice.



27(4)               The amount recovered by the Board under subsection (2) shall be remitted to the Minister of Finance.



Recovery of costs, levies, assessments

28                        Where any person fails to pay the amount or any portion of the costs assessed under section 25, the levy imposed under section 26, or the start-up costs assessed under section 27, the Board may make an order requiring the payment and file the order with The Court of Queen's Bench of New Brunswick, and the order, on filing, shall have the same force and effect as an order of the Court.



Offences

29(1)               A person who violates or fails to comply with a provision of this Act that is listed in Column I of Schedule A commits an offence.



29(2)               For the purposes of Part II of the Provincial Offences Procedure Act, each offence listed in Column I of Schedule A is punishable as an offence of the category listed beside it in Column II of Schedule A.



29(3)               Subject to subsection (4), a person who violates or fails to comply with a provision of the regulations commits an offence punishable under Part II of the Provincial Offences Procedure Act as a category B offence.



29(4)               A person who, having been required to provide information under the regulations, knowingly provides false information, commits an offence punishable under Part II of the Provincial Offences Procedure Act as a category E offence.



Continuing offence

30                        Where an offence under this Act continues for more than one day,



(a)               the minimum fine that may be imposed is the minimum fine set by the Provincial Offences Procedure Act multiplied by the number of days during which the offence continues, and



(b)               the maximum fine that may be imposed is the maximum fine set by the Provincial Offences Procedure Act multiplied by the number of days during which the offence continues.



Contract may not exclude application of orders

31                        A provision, term or condition in an agreement or contract that provides that the contract is terminated or that a wholesaler or a retailer is permitted or authorized to reduce, limit or cease to supply a petroleum product on the ground that an enactment or an order or decision of the Board or Minister prevents a price or change in the price from being effective is of no force and effect.



Administration of Act

32                        The Minister is responsible for the administration of this Act.



Regulations

33                        The Lieutenant-Governor in Council may make regulations



(a)               exempting such petroleum products or types of petroleum products and mixtures from the application of this Act or any provision of this Act or from the regulations or any provision of the regulations, subject to such terms and conditions as the Lieutenant-Governor in Council considers appropriate;



(b)               respecting the criteria to be employed by, and the procedure to be followed by, the Minister and the Board in establishing the benchmark prices for petroleum products or types of petroleum products;



(c)               respecting the criteria to be employed by, and the procedure to be followed by the Board in adjusting the maximum wholesale and retail prices for petroleum products or types of petroleum products, maximum margins and maximum delivery costs;



(d)               respecting the holding of a hearing or the conduct of a review by the Board;



(e)               respecting the manner of informing wholesalers or retailers of changes in any maximum wholesale and retail prices, maximum margins or maximum delivery costs set under this Act;



(f)                respecting the information to be provided to the Board by a wholesaler or a retailer;



(g)               respecting the display to the public by a retailer of the prices at which the retailer sells or offers to sell motor fuel;



(h)               prescribing the levy to be paid under section 26 and respecting the manner, method and time of payment of the levy and designating the products or types of products upon which the levies shall be paid;



(i)                respecting the publishing of maximum retail and wholesale prices and maximum delivery costs for petroleum products by the Board;



(j)                respecting the retention of books, records or other documents by a wholesaler or retailer;



(k)               defining terms used but not otherwise defined in this Act;



(l)                generally for the better administration of this Act.



Repeal

34(1)               The Gasoline, Diesel Oil and Home Heating Oil Pricing Act, chapter G-3.1 of the Acts of New Brunswick, 1987, is repealed.



34(2)               New Brunswick Regulation 88-216 under the Gasoline, Diesel Oil and Home Heating Oil Pricing Act is repealed.



Commencement

35(1)               This Act, other than subsections 7(3) and (4), comes into force on July 1, 2006.



35(2)               Subsections 7(3) and (4) come into force on a day to be fixed by proclamation.



SCHEDULE A

Column I

Section
   
Column II

Category of Offence

6E

7(1)E

7(3)E

8E

9(1)E

9(2)E

9(3)E

9(4)E

9(5)E

24(3)E

24(4)E

 

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