Price Commission Act 1977

2 Commission's duty to have regard to specified matters

(1) It shall be the duty of the Commission, in performing any functions mentioned in subsection (3) of this section—

(a) to have regard to all matters which appear to the Commission in the particular circumstances to be relevant with a view to restraining prices of goods and charges for services so far as that appears to the Commission to be consistent with the making of adequate profits by efficient suppliers of goods and services; and

(b) to have regard in particular to the matters mentioned in the following subsection so far as the Commission consider them relevant,

and not to have regard to any other matters.

(2) The matters aforesaid are—

(a) the need to recover costs incurred in efficiently supplying goods and services and in maintaining the value of the relevant businesses;

(b) the desirability of encouraging reductions in costs by improvements in the use of resources and of securing reductions in prices of goods and charges for services in consequence of such improvements ;

(c) the need to earn, from selling goods and providing services in the United Kingdom, profits which provide a return on the capital employed in producing the profits which is sufficient, taking one year with another—

(i) to defray the cost of the capital (including compensation for the risk involved in producing the profits), and

(ii) to provide money for, and to encourage the promotion of, innovations and technical improvements in and the expansion in the United Kingdom of the enterprises which consist of or include the relevant businesses;

(d) the need to take account of changes in prices in determining the value of assets;

(e) the desirability of maintaining the quality of goods and services and satisfying the demands of users of goods and services;

(f) the need to safeguard the interests of users of goods and services by promoting competition between suppliers or, where competition must be restricted or cannot be promoted (either because certain suppliers control a substantial share of the relevant market or for any other reason), by restricting prices and charges;

(g) the desirability of establishing and maintaining a balance between the supply of goods and services and the demand for them; and

(h) the need to avoid detriment, from restraints on prices and charges, to the United Kingdom's balance of payments and the need to increase the share of United Kingdom enterprises in markets in the United Kingdom and elsewhere.

(3) The functions of the Commission referred to in subsection (1) of this section are—

(a) the function of determining whether to give a notification in pursuance of section 4(1) or 5(1) of this Act;

(b) the function of determining whether to give a notice in pursuance of section 4(4) or paragraph (i) of section 4(5) or that paragraph as applied by section 5(4) of this Act and of determining the terms of a notice in pursuance of that paragraph or that paragraph as so applied; and

(c) the function of carrying out, and of preparing a report in consequence of, an investigation in pursuance of section 6 or an examination in pursuance of section 11 of this Act.