THE three multinational oil marketing companies operating here have put themselves on a collision course with Commerce, Science and Technology Minister Phillip Paulwell, by missing the minister's deadline to sign a critical code of conduct governing the retail petrol trade.

Shell, Esso and Texaco let the Friday, November 21 deadline slip by without affixing their signatures to the code of conduct, putting the minister on the spot, after he had sternly warned them a week ago that he would start regulating pricing mechanism in the trade, if they failed to sign.

The Sunday Observer was unable to contact Paulwell for comment at the weekend.

PAULWELL... said he would resort to powers under the Fair Trading Act to set prices

The minister's declaration that he would resort to powers under the Fair Trading Act to set prices in the eventuality of the marketing companies refusing to sign the code, was the basis on which service station operators grouped in the Jamaica Gasolene Retailers Association (JGRA) inked a deal with gas pump attendants and staved off a shutdown of service stations last week.

It was previously expected that one company, Shell, would not have signed, because of lingering concerns. But it became clear after Friday that the others -- Esso and Texaco -- had joined Shell in not signing, further igniting the already tense situation in the industry.

Shell is insisting that the code of conduct is unnecessary and would only be duplicating other laws which already govern competition and contracts in the trade. Furthermore, the company strongly objects to the inclusion of pricing in the code of conduct.

"We cannot participate in discussing issues of pricing outside of the company," Shell country chairman, Mario Vulinovich, told the newspaper Friday.

He said that Shell "fully supports" the development of a code of conduct, but had made clear the areas which it wished it to address. These, obviously, did not include pricing issues.

But the gas retailers represented by the JGRA say they are not convinced that the Act gives the minister the latitude to protect them from the marketing companies, which they have accused of manipulating their pricing mechanisms against dealers they want to get out of the system.

JGRA head, L G Brown, said that his association had been calling for legislation to protect the petrol dealers since Shell axed six of its operators several years ago.

"The current legislation does not address the petroleum sector and the minister would have to go to Parliament to enact additional legislation," Brown said. He also accused the multinationals of being "discourteous" to the minister by refusing to sign the code. He said that the JGRA was depending on the minister to use his powers to control the three firms.

Brown further claimed that the oil companies' pricing system did not allow the dealers to operate freely as the companies were able to regulate their prices.

Paulwell's bold promise to take on the multinationals, if they refused to sign the code by Friday, precipitated a settlement of the dispute between the National Workers' Union (NWU), which represents the pump attendants, and the JGRA over implementation of a 10 per cent interim pay increase for the attendants.

Last Wednesday, JGRA members voted to sign the wage contract with the NWU Friday, facilitating implementation of the pay increase by Christmas. But they attached a condition that, if the minister failed to have the code implemented, they would not commence talks on a new contract for the pump attendants due from October 1.

Shell's Vulinovich was adamant that the code was still in the discussion stage and that the talks should continue. He said that there were current laws in Jamaica governing things like commercial contracts and competition law, "and we do not believe it necessary to duplicate this in any codes".

"Shell has and will always continue to act within the framework of the law in all aspects of our business, be it safety or competition," he added.

In response to the claim about manipulating operators, Vulinovich said that Shell no longer operated its service stations. "All Shell service stations are operated by independent business persons," he said.

He added, however, that Shell had "minimum standards of operations by which all our service stations must operate" and which were developed "through extensive experience in the petroleum business across the world".

Vulinovich also insisted that the competition among the marketing companies, which include a few Jamaican-owned ones in this deregulated era, should be a "free and open market with healthy competition". The manifestation of this free and open competition, he said, was "cheaper prices to customers, as margins across the whole value chain are squeezed".

He said that with deregulation four years ago, the petrol trade had been going through a transformation which had meant more competition and led to very competitive pricing and a shift in the way margins were decided.

Tarrus Riley shoots video for Start Anew

Naomi Campbell to open retrospective photo show

A pleasant evening of music and much more