EXTRAORDINARY PUBLISHED BY AUTHORITY ST. JOHN'S, FRIDAY, NOVEMBER 16, 2001 NEWFOUNDLAND REGULATIONS 79/01

November 16, 2001 Extraordinary Gazette 3 NEWFOUNDLAND REGULATION 79/01 Petroleum Products Regulations under the Petroleum Products Act (O.C. 2001-705) (Filed November 16, 2001) Under the authority of

section 23 of the Petroleum Products Act , the Lieutenant-Governor in Council makes the following regulations. Dated at St. John’s, November 16, 2001. Deborah E. Fry Clerk of the Executive Council REGULATIONS Analysis 1.

Short title 2.

Definitions 3. Information to be provided 4. Periodic reports 5. Zone criteria 6. Point of sale 7. Components of the maxi- mum price 8. Confidentiality 9. Initial setting of the bench- mark price 10. Initial setting of the total allowed mark-up 11. Initial setting of the allowed wholesale mark-up 12. Applicable taxation 13. Allowed service costs 14. Periodic adjustment timing 15. Application for change in maximum price

Schedule 1. These regulations may be cited as the Petroleum Products Regulations.

Short title

Petroleum Products Regulations 79/01 November 16, 2001 Extraordinary Gazette 4 2.

In these regulations (a) "benchmark" means, with respect to a type of heating fuel or motor fuel, the corresponding product classification utilized by Platts under the heading "Product Price Assessments, New York Cargo", and as set out in the Schedule; (b) "Bloombergs" means Bloombergs Oil Buyers Guide; (c) "maximum retail price" mean s the petroleum product base price for a type of heating fuel or motor fuel, which consti- tutes the maximum price chargeable by a retailer to a con- sumer for that type of heating fuel or motor fuel; (d) "maximum wholesale price" means the petroleum product base price for a type of heat ing fuel or motor fuel, which constitutes the maximum price chargeable by a wholesaler to a retailer for that type of heating fuel or motor fuel; (e) "Platts" means Platts Oilgram Price Report; and (f) "point of sale" means (

i) with respect to the sale of heating fuel or motor fuel by a wholesaler to a retailer, the location of the outlet from which the retailer intends to sell the heating fuel or mo- tor fuel to consumers, or (ii) with respect to the sale of heating fuel or motor fuel by a retailer to a consumer, the location at which the heat- ing fuel or motor fuel is delivered to the consumer. 3.

(1) Within 30 days after these regulations come into force, every wholesaler and retailer shall provide the commissioner, in writing, with (

a) the name of an individual and his or her position title, desig- nated by the wholesaler or reta iler, to receive all notices, de- cisions, requests, correspondence and other communications from the commissioner on behalf of that wholesaler or re- tailer; and (

b) contact information for the whol esaler or retailer, including where possible

Definitions Information to be provided

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i) a mailing address; (ii) a telephone number, (iii) a facsimile number, and (iv) an electronic mail address.

(2) A person who becomes a wholesaler or retailer after these regulations come into force shall provide the commissioner with the information set out in subsection (1) within 30 days of becoming a wholesaler or retailer.

(3) Where the Act or these regulations require the commissioner to inform a wholesaler or retailer of a decision taken by the commis- sioner, the commissioner shall inform the wholesaler or retailer in the manner that the commissioner consid ers appropriate af ter considering the information provided under subsection (1) or (2).

(4) Where a decision of the commissioner affects all retailers or wholesalers or a number of eith er, the commissioner may inform them of the decision by using a general means including a newspaper in cir- culation in the province.

(5) A wholesaler or retailer shall inform the commissioner of any changes to the contact information submitted under subsection (1) or (2). 4.

(1) The commissioner may require wholesalers to submit writ- ten reports on a quarterly basis containing: (

a) the name, location, zone or sub-zone, and type of retailer to whom motor fuels or heating fuels are sold or held for re- selling to consumers; (

b) the volumes of each product sold to each retailer by outlet totalled in litres on a monthly basis; (

c) the average monthly price of each product identified in para- graph (

b) including taxes and excluding taxes; and (

d) the amounts of each type of taxes identified in the totals referred to in paragraph (c). Periodic reports

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(2) The commissioner may require retailers to submit written reports for retail motor fuel outlets on a quarterly basis containing (

a) the name, location, zone or sub-zone, and type of each retail outlet at which petroleum fuels are sold to consumers; (

b) the type and capacity in litres of each storage tank at each outlet by type and grade of product; (

c) the volumes of each type or grade of fuel sold totalled in litres on a monthly basis; (

d) the volume of each product sold through self-serve pumps and through full service pumps totalled in litres on a monthly basis; and (

e) the daily pump prices for each type, grade and service mode for each product for the period.

(3) The commissioner may require retailers to submit written reports for retail heating fuels on a quarterly basis as follows: (

a) the name, location, and operating zone or sub-zone areas of each retailer of heating fuels; (

b) a description of the method by which the retailer purchases products from a wholesaler; (

c) the name of each wholesal er and volumes purchased from each by product type and volum e in litres on a monthly ba- sis; (

d) the capacity in litres of each tank-truck the heating fuel re- tailer uses to deliver products to consumers; (

e) the capacity in litres of each st orage tank if the retailer draws product from a designated bulk storage plant; (

f) the volumes of each type or grade of fuel sold totalled in litres on a monthly basis; and (

g) the delivered tank wagon pr ice for each type and grade of heating fuel sold to consumers for the period.

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(4) A retailer shall record the starting price for the period and then indicate the changes and effectiv e dates, if any, of price adjust- ments during the reporting period.

(5) The commissioner shall keep confidential all information supplied to him or her by wholesalers and retailers of heating fuel and motor fuel under this

section except where the release of the informa- tion is approved by the wholesaler or retailer who provided it.

(6) A request by the commissioner under this

section shall be made in writing and shall indicate the date on which a response to the request must be submitted to the commissioner. 5.

(1) The commissioner for the purpose of dividing the province into zones shall consider (

a) the prices that have been charged to retailers and consumers for heating fuel and motor fuel throughout the province, for the period of time that the commissioner considers appropri- ate; (

b) those factors and costs that may explain the differences, if any, between the prices that have been charged to retailers and consumers for heating fuel and motor fuel throughout the province for the period of time considered appropriate by the commissioner under paragraph (a), including, (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates; and (

c) the other considerations that the commissioner considers relevant.

(2) The commissioner shall inform wholesalers and retailers as to the zones he or she has established. Zone criteria

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(1) A wholesaler shall not charge a price to a retailer for heating fuel or motor fuel greater than the maximum wholesale price for the zone within which the point of sale is located.

(2) A retailer shall not charge a price to a consumer for heating fuel or motor fuel greater than the maximum retail price for the zone within which the point of sale is located.

(3) Notwithstanding subsections (1) and (2), the commissioner may, in accordance with the Act and these regulations, set a different maximum wholesale price or retail pr ice that a wholesaler or retailer may charge for heating fuel or motor fuel within a zone. 7.

(1) For each type of heating fu el and motor fuel, the maximum retail price shall be the sum of (

a) the benchmark price; (

b) the total allowed mark-up; (

c) applicable taxation; and (

d) any allowed service costs.

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

a) the benchmark price; (

b) the allowed wholesale mark-up; and (

c) applicable taxation.

(3) For the purpose of establishing the maximum wholesale price or maximum retail price of heating fuel or motor fuel, the com- missioner may hold a hearing where he or she considers one is desir- able. 8. Unless authorized by the commi ssioner, a wholesaler or retailer shall not disclose to any other person a price established by the com- missioner before the date on which the price comes into force. Point of sale Components of the maximum price Confidentiality

Petroleum Products Regulations 79/01 November 16, 2001 Extraordinary Gazette 9 9.

(1) For each type of motor fuel and heating fuel, the benchmark price shall be the average of the average of the daily high and low product prices for the benchmark, as reported in Platts or Bloombergs during the 4 week period immediat ely preceding the date on which the maximum wholesale price or maximum retail price is to take effect.

(2) The commissioner shall use daily noon exchange rates pub- lished by the Bank of Canada for the purpose of converting United States currency to Canadian currency.

(3) The benchmark price determined by the commissioner shall be expressed in Canadian cents per litre or other unit of measurement appropriate to the petroleum product. 10.

(1) For each type of motor fuel and heating fuel, the commis- sioner shall, for the purpose of esta blishing the total allowed mark-up, consider (

a) the historical margin between product prices for the bench- mark and the prices that have been charged to consumers within the province or zone for the type of heating fuel or motor fuel, excluding applicable taxation, for the period of time that the commissioner considers appropriate; (

b) whether the historical margins identified as a result of para- graph (

a) are reasonable, taking into account (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates; and (

c) that the maximum retail price only sets a maximum price for the sale of motor fuel and heating fuel by retailers to con- sumers and should, to the extent possible, allow competition between retailers within a zone or the province; and Initial setting of the benchmark price Initial setting of the total allowed mark- up

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d) the other considerations that the commissioner considers relevant.

(2) The commissioner may establish a different maximum retail price that a retailer may charge for a type of heating fuel or motor fuel within a zone by establishing a different total allowed mark-up for that retailer by taking into consideration (

a) whether a different total allowed mark-up would be fair and reasonable taking into account the (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates of the retailer in comparison to other retailers within the zone; and (

b) the other considerations that the commissioner considers relevant.

(3) The total allowed mark-up shall be expressed in Canadian cents per litre or other unit of measurement appropriate to the petro- leum product. 11.

(1) After the total allowed mark-up for a type of heating fuel or motor fuel has been established, the commissioner shall establish the allowed wholesale mark-up for that ty pe of heating fuel or motor fuel by taking into consideration, (

a) the historical margin between the benchmark price and the prices that have been charged to retailers within the province or a zone for the type of heating fuel or motor fuel, exclud- ing applicable taxes, for the period the commissioner con- siders appropriate; Initial setting of the allowed wholesale mark-up

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b) whether the historical margins identified as a result of para- graph (

a) are reasonable, taking into account (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distribution costs, and (

v) inventory turnover rates; and (

c) that the maximum wholesale price only sets a maximum price for the sale of motor fuel and heating fuel by wholesal- ers to retailers and should, to the extent possible, allow com- petition between wholesalers within a zone or the province.

(2) The commissioner may establish a different maximum wholesale price that a wholesaler ma y charge for a type of heating fuel or motor fuel within a zone by establishing a different allowed whole- sale mark-up taking into consideration (

a) whether a different allowed wholesale mark-up would be fair and reasonable taking into account the (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates of the wholesaler in comparis on to other wholesalers within the zone; and (

b) the other considerations that the commissioner considers relevant.

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(3) The allowed wholesale mark-up shall be expressed in Cana- dian cents per litre or other unit of measurement appropriate to the petroleum product. 12. The applicable taxation shall be the amount of taxation payable by a wholesaler or retailer in respect of a type of heating fuel or motor fuel and shall be expressed in Cana dian cents per litre or other unit of measurement appropriate to the petroleum product. 13.

(1) The commissioner may establish an allowed service cost in respect of a particular service offered by retailers to consumers in rela- tion to a type of heating fuel or motor fuel that is not reflected in the benchmark price, total allowed mark-up or applicable taxation.

(2) When establishing an allowed service cost, the commis- sioner shall consider the costs to the retailer to provide the service to consumers.

(3) The maximum retail price for a type of heating fuel or motor fuel shall only include the allowed service cost if the particular service has been provided or will be provided to the consumer by the retailer.

(4) The allowed service cost shall be expressed in Canadian cents per litre or other unit of measurement appropriate to the petro- leum product. 14.

(1) The commissioner shall adjust the benchmark price for each type of motor fuel and heating fuel on a monthly basis, but where cir- cumstances warrant, the commissioner may adjust prices at other times.

(2) For each type of motor fuel and heating fuel, the benchmark price shall be adjusted to be the average of the average of the daily high and low product prices for the benchmark, as reported in Platts, during the period immediately following (

a) the date on which the benchmark price was first established by the commissioner; or (

b) where the benchmark price has been previously adjusted, the date on which the benchmark price was last adjusted. Applicable taxation Allowed service costs Periodic adjustment timing

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(3) The commissioner may, at any time, adjust the total allowed mark-up or allowed wholesale mark-u p for a type of heating fuel or motor fuel taking into consideration (

a) whether an adjustment would be reasonable given changes, if any, to (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates since the total allowed mark-up or allowed wholesale mark- up was last established by the commissioner; and (

b) the other considerations that the commissioner considers relevant.

(4) The commissioner may, at an y time, adjust the allowed service cost for a type of motor fuel or heating fuel, after considering whether an adjustment would be reasonable given changes to the costs to the retailer to provide the service to consumers since the allowed service cost was last established by the commissioner.

(5) When making an adjustment under this section, the commis- sioner may hold a hearing where he or she considers one is desirable.

(6) Where the commissioner adjusts the benchmark price, the total allowed mark-up, the allowed wholesale mark-up, or the allowed service cost he or she shall inform wholesalers and retailers of the ad- justment and the date on which the new maximum wholesale price or maximum retail price comes into effect.

(7) Where a decision of the commissioner affects all retailers or wholesalers or a number of eith er, the commissioner may inform them of the decision by using a general means including a newspaper in cir- culation in the province.

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(1) Where a wholesaler or retailer applies for a change in price under subsection 8(1) of the Act, the commissioner may set a new maximum wholesale price or maximu m retail price that the applicant may charge for a type of heating fu el or motor fuel within a zone by adjusting (

a) the total allowed mark-up or wholesale mark-up for the ap- plicant; (

b) the allowed service cost; or (

c) both the total allowed mark-up and the allowed service cost.

(2) The commissioner may adjust the total allowed mark-up or wholesale mark-up for the applicant, taking into consideration (

a) whether a change would be reasonable as a result of a change to (

i) transportation costs, (ii) volume of sales, (iii) storage costs, (iv) distributions costs, and (

v) inventory turnover rates since the total allowed mark-up or allowed wholesale mark- up was last established by the commissioner; and (

b) the other considerations that the commissioner considers relevant.

(3) The commissioner may adjust the allowed service cost for an applicant, after considering whether an adjustment would be reasonable as a result of a change to the costs to the retailer to provide the service to consumers since the allowed service cost was last established by the commissioner. Application for change in maximum price

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Schedule Benchmark Motor Fuel/Heating Fuel Platts New York Cargo Unl 87 Regular Unleaded Gasoline Platts New York Cargo Unl 89 Mid-grade Unleaded Gasoline Platts New York Cargo Super Unl 93 Premium Unleaded Gasoline Platts New York Cargo LS No. 2 Low Sulphur Diesel Platts New York Cargo No. 2 Furnace Oil Platts New York Cargo No. 2 Stove Oil Bloomberg's Oil Buyers Guide Sarnia Propane Propane ©Earl G. Tucker, Queen's Printer

ST. JOHN'S, FRIDAY, NOVEMBER 16, 2001 17 Index Title of Act and Subordinate Legislation CNR or Nfld. Gazette made thereunder Nfld. Reg. Amendment Date & Page No. Petroleum Products Act Petroleum Products Regulations 79/01 new Extra. Nov 16/01, p 3