Water Act 2003

26 Recovery of compensation from new licence-holder

After section 61 of the WRA there is inserted—

“61A Recovery of compensation from new licence-holder

(1) This section applies where compensation has been paid under section 61 above to the holder of a licence (“licence A”) following its revocation, and—

(a) the holder of licence A was a water undertaker;

(b) at the time of the revocation an application from a qualifying person for a licence to abstract water (“licence B”) was outstanding;

(c) if the Agency had granted licence B while licence A still had effect, the Agency would have been in breach of the duty imposed on it by section 39(1) above owed to the holder of licence A;

(d) the ground for revoking licence A was that the Agency was of the view that in the interests of greater efficiency in the use of water resources it would be better for licence B to be granted and licence A revoked; and

(e) the Agency proposes to grant licence B.

(2) If this section applies, the Agency may (if licence B is granted) recover from the qualifying person the amount of the compensation referred to in subsection (1) above (or such lesser amount as the Agency determines).

(3) Subsection (6) of section 41 of the 1995 Act (which confers powers to make schemes imposing charges) shall apply to the amount referred to in subsection (2) above as if it were a charge due and payable to the Agency in respect of the subsistence of licence B.

(4) In this section, “qualifying person” means—

(a) a water undertaker; or

(b) a person who has made an application for an appointment or variation replacing a company as a water undertaker under section 8 of the Water Industry Act 1991 which has not been determined.”