4.—(1) In paragraph 68 of Schedule 6 to the GMS Contracts Regulations (other contractual terms — sub-contracting of clinical matters), after sub-paragraph (9) add the following sub-paragraph—
“(10) The contractor shall not sub-contract any of its rights or duties under the contract in relation to the provision of essential services to a company or firm—
(a)owned wholly or partly by the contractor, or by any former or current employee of, or partner or shareholder in, the contractor;
(b)formed by or on behalf of the contractor, or from which it derives or may derive a pecuniary benefit; or
(c)formed by or on behalf of a former or current employee of, or partner or shareholder in, the contractor, or from which such a person derives or may derive a pecuniary benefit,
where that company or firm is or was formed wholly or partly for the purpose of avoiding the restrictions on the sale of the goodwill of a medical practice in section 54 of the Act or any Regulations made wholly or partly under that section.”
(2) After paragraph 112 of Schedule 6 to the GMS Contracts Regulations (other contractual terms), insert the following paragraph—
112A. If the contractor breaches the condition specified in paragraph 68(10) and it comes to the Local Health Board’s attention that the contractor has done so, the Local Health Board shall serve a notice in writing on the contractor—
(a)terminating the contract forthwith; or
(b)instructing it to terminate the sub-contracting arrangements that give rise to the breach forthwith, and if it fails to comply with the instruction, the Local Health Board shall serve a notice in writing on the contractor terminating the contract forthwith.”.