Filenews 16 December 2022 - by Chrysanthos Manoli
According to a special audit report published yesterday by the Audit Office, the Costing Model used by the Consumer Protection Service, of the competent ministry, to determine an acceptable wholesale price per litre of fuel by oil companies, allows them to load by independent gas station owners some of their own expenses for the construction and operation of the privately owned by the companies petrol stations, which is the majority. As the report shows, this undermines, with the ministry's own complicity, competition between petrol station owners, which could bring lower prices for consumers, as independent petrol station owners also have to pay the depreciation cost of the investment of their competing petrol stations, which are owned by the oil importing companies, which prevents the independent ones from selling at better prices and competing from a better position.
The Audit Office claims that the Consumer Protection Service has at its disposal two manuals to arrive at the acceptable wholesale price, but chooses to use only the manual that provides for the inclusion in the companies' expenses of the costs of investments in the privately owned petrol stations (even the cost of staff at these stations!), instead of the manual that does not include these costs and which manual the Audit Office considers fairer for the independents service station owners.
When the Audit Committee requested the ministry's positions on the above findings and observations, the general manager replied that the costing methodology is followed, which concerns the majority of petrol stations, which are the petrol stations owned by the oil companies. He also noted that the ministry is closely monitoring the market and, in case there is an increase in the number of DODOs (independent petrol stations), then the necessary actions will be taken...
As stated in the report, "the Audit Office considers the ministry's response to be unsatisfactory, since it is an admission that the Consumer Protection Service allows oil companies to overcharge unconnected petrol stations, essentially passing on to them the costs of their own petrol stations."
Immediately afterwards, the Auditor General states the following: "It is our intention to inform the Commission for the Protection of Competition, since the practice of oil companies to pass on the costs of their connected service stations to the unaffiliated ones, may constitute an abuse of a dominant position, within the meaning of the Competition Protection Law."
They do not verify companies' data on costs
It appears elsewhere in the special report that the Consumer Protection Service does not verify the data provided by companies in order to check prices and arrive at an acceptable costing. The Audit Committee cites part of the handbook used by the Ministry for costing, which "collects the income/expenses/assets of the companies, which are considered to be related to the marketing of petroleum products. Based on the analysis given by the companies for COCOs/CODOs (service stations), the revenues/expenses/assets are adjusted to reflect those related to the marketing of petroleum products." The Audit asked the ministry to inform whether it is carrying out any check on the correctness of these amounts, which ensures that the analysis prepared by the companies does not include income, expenses and assets, which are not related to the marketing of petroleum products. The Ministry's DG replied, according to the report, that there is no procedure for such a check in the consultant's manual and that the ministry relies on the data that companies fill in excel sheets, on the basis of the previous evaluation framework. He also said that any false statements by the companies are a criminal offense...
