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Water Industry Act 1991

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Water Industry Act 1991

1991 CHAPTER 56

An Act to consolidate enactments relating to the supply of water and the provision of sewerage services, with amendments to give effect to recommendations of the Law Commission.

[25th July 1991]

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Extent Information

E1Act extends to England and Wales; for minor variations see s. 223(3)

Modifications etc. (not altering text)

C1A reference to a detention centre within the meaning of Part VIII of the Immigration and Asylum Act 1999 (c. 33) to be construed as a reference to a removal centre within the meaning of that Part (10.2.2003) by virtue of 2002 c. 41, s. 66(4); S.I. 2003/1, art. 2, Sch.

C4Act: transfer of functions (W.) (except ss. 1,14, 15, 17, 24(2)(d), 27(3), 32-35, 152(2), 193(3), 206(3)(e), Schs. 1, 4 and subject to entry in Sch. 1 of the amending S.I.) (1.7.1999) by 1999/672, art. 2, Sch. 1 (as amended by 2003 c. 37, s. 100(2)(4)(6)(7); S.I. 2004/2528, art. 2(s); S.I. 2006/3334, Sch.)

C6Act restricted (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 18(2), 225(2).

C7Act: definitions of "service pipe" and "water main" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 162(6), 225(2).

Act: definition of "sewerage services" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 173, Sch. 20 para. 8(1), s. 207(8), 225(2).

Act: definition of "service pipe" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 176(7) and 195(7), 225(2).

Act: definition of "stopcock" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 176(7) and 221(1), 225(2).

Act: definition of "trunk main" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 186(1), 225(2).

Act: definition of "drain" applied (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 221(1), 225(2).

C8[A table showing the derivation of the provisions of this Consolidation Act will be found at the end of the Act. The table has no official status.]

C10Act: definition of "public sewers" applied (01.12.1991) by Land Drainage Act 1991 (c. 59, SIF 73:1), ss. 72(1), 76(2) (with ss. 67(3)(5)(8), 72(6)(8), 74(3)(4)).

Commencement Information

I1Act wholly in force at 1.12.1991 see s. 223(2)

Part IE+W PRELIMINARY

The Director General of Water ServicesE+W

1 The Director General of Water Services.E+W

F1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

[F21AWater Services Regulation AuthorityE+W

(1)There shall be a body corporate to be known as the Water Services Regulation Authority (in this Act referred to as “the Authority”) for the purpose of carrying out the functions conferred on or transferred to it by this Act or under or by virtue of any other enactment.

(2)The functions of the Authority are performed on behalf of the Crown.

(3)Schedule 1A to this Act shall have effect with respect to the Authority.

(4)In Welsh the Authority may be known as “Awdurdod Rheoleiddio Gwasanaethau Dŵr”.]

Textual Amendments

General dutiesE+W

2 General duties with respect to water industry.E+W

(1)This section shall have effect for imposing duties on the Secretary of State and on the Director as to when and how they should exercise and perform [F3the following powers and duties, that is to say—

(a)in the case of the Secretary of State, the powers and duties conferred or imposed on him by virtue of the provisions of this Act relating to the regulation of relevant undertakers [F4and of licensed water suppliers] ; and

(b)in the case of the Director, the powers and duties conferred or imposed on him by virtue of any of those provisions, by the provisions relating to the financial conditions of requisitions or by the provisions relating to the movement of certain pipes.][F3the powers and duties conferred or imposed on the Secretary of State or the Authority by virtue of any of the relevant provisions.]

[F5(2A)The Secretary of State or, as the case may be, the Authority shall exercise and perform the powers and duties mentioned in subsection (1) above in the manner which he or it considers is best calculated—

(a)to further the consumer objective;

(b)to secure that the functions of a water undertaker and of a sewerage undertaker are properly carried out as respects every area of England and Wales;

(c)to secure that companies holding appointments under Chapter 1 of Part 2 of this Act as relevant undertakers are able (in particular, by securing reasonable returns on their capital) to finance the proper carrying out of those functions; F6...

(d)to secure that the activities authorised by the licence of a licensed water supplier and any statutory functions imposed on it in consequence of the licence are properly carried out[F7; and

(e)to further the resilience objective.]

(2B)The consumer objective mentioned in subsection (2A)(a) above is to protect the interests of consumers, wherever appropriate by promoting effective competition between persons engaged in, or in commercial activities connected with, the provision of water and sewerage services.

(2C)For the purposes of subsection (2A)(a) above the Secretary of State or, as the case may be, the Authority shall have regard to the interests of—

(a)individuals who are disabled or chronically sick;

(b)individuals of pensionable age;

(c)individuals with low incomes;

(d)individuals residing in rural areas; and

(e)customers, of companies holding an appointment under Chapter 1 of Part 2 of this Act, whose premises are not eligible to be supplied by a licensed water supplier,

but that is not to be taken as implying that regard may not be had to the interests of other descriptions of consumer.

(2D)For the purposes of subsection (2C) above, premises are not eligible to be supplied by a licensed water supplier if—

(a)they are household premises (as defined in section 17C below); or

(b)the total quantity of water estimated to be supplied to the premises annually for the purposes of subsection (2) of section 17D below is less than the quantity specified in that subsection.

[F8(2DA)The resilience objective mentioned in subsection (2A)(e) is—

(a)to secure the long-term resilience of water undertakers' supply systems and sewerage undertakers' sewerage systems as regards environmental pressures, population growth and changes in consumer behaviour, and

(b)to secure that undertakers take steps for the purpose of enabling them to meet, in the long term, the need for the supply of water and the provision of sewerage services to consumers,

including by promoting—

(i)appropriate long-term planning and investment by relevant undertakers, and

(ii)the taking by them of a range of measures to manage water resources in sustainable ways, and to increase efficiency in the use of water and reduce demand for water so as to reduce pressure on water resources.

(2DB)For the purposes of subsection (2DA)—

(a)the reference to water undertakers' supply systems is to be construed in accordance with section 17B;

(b)the reference to sewerage undertakers' sewerage systems is a reference to the systems comprising—

(i)the systems of public sewers, the facilities for emptying public sewers and the sewage disposal works and other facilities for dealing effectually with the contents of public sewers that undertakers are required to provide by section 94, and

(ii)the lateral drains that undertakers are required to maintain by section 94.]

(2E)The Secretary of State and the Authority may, in exercising any of the powers and performing any of the duties mentioned in subsection (1) above, have regard to—

(a)any interests of consumers in relation to electricity conveyed by distribution systems (within the meaning of the Electricity Act 1989);

(b)any interests of consumers in relation to gas conveyed through pipes (within the meaning of the Gas Act 1986);

(c)any interests of consumers in relation to communications services and electronic communications apparatus (within the meaning of the Communications Act 2003),

which are affected by the exercise of that power or the performance of that duty.]

[F9(3)Subject to subsection (2A) above, the Secretary of State or, as the case may be, the Authority shall exercise and perform the powers and duties mentioned in subsection (1) above in the manner which he or it considers is best calculated—

(a)to promote economy and efficiency on the part of companies holding an appointment under Chapter 1 of Part 2 of this Act in the carrying out of the functions of a relevant undertaker;

(b)to secure that no undue preference is shown, and that there is no undue discrimination in the fixing by such companies of water and drainage charges;

[F10(ba)to secure that no undue preference (including for itself) is shown, and that there is no undue discrimination, in the doing by such a company of—

(i)such things as relate to the provision of services by itself or another such company, or

(ii)such things as relate to the provision of services by a water supply licensee or a sewerage licensee;]

(c)to secure that consumers are protected as respects benefits that could be secured for them by the application in a particular manner of any of the proceeds of any disposal (whenever made) of any of such a company’s protected land or of an interest or right in or over any of that land;

(d)to ensure that consumers are also protected as respects any activities of such a company which are not attributable to the exercise of functions of a relevant undertaker, or as respects any activities of any person appearing to the Secretary of State or (as the case may be) the Authority to be connected with the company, and in particular by ensuring—

(i)that any transactions are carried out at arm’s length;

(ii)that the company, in relation to the exercise of its functions as a relevant undertaker, maintains and presents accounts in a suitable form and manner;

F11(iii). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(e)to contribute to the achievement of sustainable development.

(4)In exercising any of the powers or performing any of the duties mentioned in subsection (1) above in accordance with the preceding provisions of this section, the Secretary of State and the Authority shall have regard to the principles of best regulatory practice (including the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed).]

(5)In this section the references to water and drainage charges are references to—

(a)any charges in respect of any services provided in the course of the carrying out of the functions of a relevant undertaker; and

(b)amounts of any other description which such an undertaker is authorised by or under any enactment to require any of its customers or potential customers to pay.

[F12(5A)In this section—

  • consumers” includes both existing and future consumers; and

  • the interests of consumers” means the interests of consumers in relation to—

    (a)

    the supply of water by means of a water undertaker’s supply system to premises either by water undertakers or by licensed water suppliers acting in their capacity as such; and

    (b)

    the provision of sewerage services by sewerage undertakers.]

(6)For the purposes of this section—

[F13(a)subject to subsection (6A) below, the reference in subsection (1) above to [F14the provisions of this Act relating to the regulation of relevant undertakers and of licensed water suppliers] [F14the relevant provisions] is a reference to the provisions [F15contained in Part 2 of this Act (except section 27A, and Schedule 3A), or in any of sections 37A to 38, 39, 39B, 39C, 66B, 66D, 66F to 66H, 66K, 66L, 95, 96, 153, 181, 182, 192A, 192B, 195, 195A and 201 to 203 below;] [F15contained in—

(i)Part 2 of this Act (except section 27A and Schedule 3A),

(ii)any of sections 37A to 38, 38ZA, 39, 39ZA, 39B to 39D, 40E to 40J, 42, 51CD to 51CG, 63AC to 63AF, 66B, 66CA to 66H, 66K, 66L, 66O(2), 95, 95ZA, 96, 96ZA, 99, 105ZF to 105ZI, 110F to 110J, 110L to 110O, 117E to 117O, 117R, 117S, 143B to 143E, 144ZA to 144ZF, 153, 181, 182, 185, 192A, 192B, 195, 195A and 201 to 203 below, and

(iii)any of sections 42 to 54 of the Water Act 2014.]

(b)[F16the reference in that subsection to the provisions relating to the financial conditions of requisitions is a reference to the provisions contained in sections 42, 43, 43A, 48, 51C, 99, 100 and 100A below; and]]

(c)[F17the reference in that subsection to the provisions relating to the movement of certain pipes is a reference to the provisions of section 185 below.]

F18[(6A)[F19Subsections (2A) to (4) above and [F20sections 2A and 2B] below] do not apply in relation to anything done by the Director in the exercise of functions assigned to him by section 31(3) below (“Competition Act functions”).

(6B)The Director may nevertheless, when exercising any Competition Act function, have regard to any matter in respect of which a duty is imposed by any of [F21subsections (2A) to (4) above and [F22sections 2A and 2B] below] , if it is a matter to which [F23the CMA] could have regard when exercising that function.]

[F24(7)The duties imposed by subsections (2A) to (4) above and [F25sections 2A and 2B] below do not affect the obligation of the Authority or, as the case may be, the Secretary of State to perform or comply with any other duty or requirement (whether arising under this Act or another enactment, by virtue of any [F26EU] obligation or otherwise).]

Textual Amendments

F3Words in s. 2(1) substituted (15.7.2015 for specified purposes, 1.9.2015 for specified purposes, 1.11.2015 for specified purposes, 18.12.2015 for specified purposes) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 3(2); S.I. 2015/1469, arts. 2(f)(ii), 3(f)(ii), 4(c)(ii); S.I. 2015/1938, art. 2(g)(ii)

F4Words in s. 2(1)(a) inserted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(2), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F5S. 2(2A)-(2E) substituted (1.4.2005) for s. 2(2) by Water Act 2003 (c. 37), ss. 39(3), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F6Word in s. 2(2A)(c) omitted (14.7.2014 for specified purposes, 18.12.2015 in so far as not already in force) by virtue of Water Act 2014 (c. 21), ss. 22(2)(a), 94(2)(e); S.I. 2015/1938, art. 2(e)

F7S. 2(2A)(e) and word inserted (14.7.2014 for specified purposes, 18.12.2015 in so far as not already in force) by Water Act 2014 (c. 21), ss. 22(2)(b), 94(2)(e); S.I. 2015/1938, art. 2(e)

F8S. 2(2DA)(2DB) inserted (14.7.2014 for specified purposes, 18.12.2015 in so far as not already in force) by Water Act 2014 (c. 21), ss. 22(3), 94(2)(e); S.I. 2015/1938, art. 2(e)

F9S. 2(3)(4) substituted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(4), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F10S. 2(3)(ba) inserted (1.1.2015 for W. for specified purposes, 6.4.2015 for W. for specified purposes) by Water Act 2014 (c. 21), ss. 23, 94(3); S.I. 2014/3320, art. 2(1)(a) (with art. 3); S.I. 2015/773, art. 2(3)(a) (with art. 6)

F11S. 2(3)(d)(iii) omitted (25.6.2013) by virtue of Enterprise and Regulatory Reform Act 2013 (c. 24), s. 103(2), Sch. 21 para. 4

F12S. 2(5A) inserted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(5), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F13S. 2(6)(a)(b) substituted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(6), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F14Words in s. 2(6)(a) substituted (15.7.2015 for specified purposes, 1.9.2015 for specified purposes, 1.11.2015 for specified purposes, 18.12.2015 for specified purposes) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 3(8)(a); S.I. 2015/1469, arts. 2(f)(ii), 3(f)(ii), 4(c)(ii); S.I. 2015/1938, art. 2(g)(ii)

F15Words in s. 2(6)(a) substituted (15.7.2015 for specified purposes, 1.9.2015 for specified purposes, 1.11.2015 for specified purposes, 18.12.2015 for specified purposes) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 3(8)(b); S.I. 2015/1469, arts. 2(f)(i), 3(f)(i), 4(c)(i); S.I. 2015/1938, art. 2(g)(i)

F16S. 2(6)(b) repealed (15.7.2015 for specified purposes, 1.9.2015 for specified purposes, 1.11.2015 for specified purposes, 18.12.2015 for specified purposes) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 3(8)(c); S.I. 2015/1469, arts. 2(f)(ii), 3(f)(ii), 4(c)(ii); S.I. 2015/1938, art. 2(g)(ii)

F17S. 2(6)(c) repealed (15.7.2015 for specified purposes, 1.9.2015 for specified purposes, 1.11.2015 for specified purposes, 18.12.2015 for specified purposes) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 3(8)(c); S.I. 2015/1469, arts. 2(f)(ii), 3(f)(ii), 4(c)(ii); S.I. 2015/1938, art. 2(g)(ii)

F18S. 2(6A)(6B) inserted (26.11.1998 for specified purposes and otherwise 1.3.2000) by 1998 c. 41, s. 54(3), Sch. 10 Pt. II para. 5(4) (with s. 73); S.I. 1998/2750, art. 2(1); S.I. 2000/344, art. 2, Sch.

F19Words in s. 2(6A) substituted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(7), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F20Words in s. 2(6A) substituted (6.4.2015) by Water Act 2014 (c. 21), ss. 24(2), 94(3); S.I. 2015/773, art. 2(1)(c) (with art. 4)

F21Words in s. 2(6B) substituted (1.4.2005) by Water Act 2003 (c. 37), ss. 39(8), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F22Words in s. 2(6B) substituted (6.4.2015) by Water Act 2014 (c. 21), ss. 24(2), 94(3); S.I. 2015/773, art. 2(1)(c) (with art. 4)

F24S. 2(7) added (1.4.2005) by Water Act 2003 (c. 37), ss. 39(9), 105(3); S.I. 2005/968, art. 2(f) (with savings in art. 4, Schs. 1, 2)

F25Words in s. 2(7) substituted (6.4.2015) by Water Act 2014 (c. 21), ss. 24(2), 94(3); S.I. 2015/773, art. 2(1)(c) (with art. 4)

Modifications etc. (not altering text)

[F272AStrategic priorities and objectives: EnglandE+W

(1)The Secretary of State may from time to time publish a statement setting out strategic priorities and objectives for the Authority in carrying out relevant functions relating wholly or mainly to England.

(2)The Authority must carry out those functions in accordance with any statement published under this section.

(3)In formulating a statement under this section, the Secretary of State—

(a)must have regard to the duties imposed on the Authority under section 2,

(b)must have regard to social and environmental matters, and

(c)may have regard to such other matters as the Secretary of State thinks fit.

(4)Before publishing a statement under this section, the Secretary of State must consult—

(a)the Authority,

(b)the Council,

(c)relevant undertakers,

(d)licensed water suppliers,

(e)the Environment Agency,

(f)the Welsh Ministers,

(g)the NRBW, and

(h)anyone else the Secretary of State thinks appropriate.

(5)Before publishing a statement under this section the Secretary of State must—

(a)lay a draft of the statement before Parliament, and

(b)then wait until the end of the 40-day period.

(6)The Secretary of State may not publish the statement under this section if, within the 40-day period, either House of Parliament resolves not to approve it.

(7)The 40-day period” means the period of 40 days beginning with the day on which the draft is laid before Parliament (or, if it is not laid before each House on the same day, the later of the days on which it is laid).

(8)When calculating the 40-day period, ignore any period during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than 4 days.

(9)In this section “relevant functions relating wholly or mainly to England” means the functions mentioned in section 2(1)(b) so far as they relate to appointment areas wholly or mainly in England.

(10)In subsection (9) “appointment area” means an area for which an appointment is held under Chapter 1 of Part 2.]

Textual Amendments

F27Ss. 2A, 2B substituted for s. 2A (6.4.2015) by Water Act 2014 (c. 21), ss. 24(1), 94(3); S.I. 2015/773, art. 2(1)(c) (with art. 4)

[F272BStrategic priorities and objectives: WalesE+W

(1)The Welsh Ministers may from time to time publish a statement setting out strategic priorities and objectives for the Authority in carrying out relevant functions relating wholly or mainly to Wales.

(2)The Authority must carry out those functions in accordance with any statement published under this section.

(3)In formulating a statement under this section the Welsh Ministers—

(a)must have regard to the duties imposed on the Authority under section 2,

(b)must have regard to social and environmental matters, and

(c)may have regard to such other matters as the Welsh Ministers think fit.

(4)Before publishing a statement under this section, the Welsh Ministers must consult—

(a)the Authority,

(b)the Council,

(c)relevant undertakers,

(d)licensed water suppliers,

(e)the NRBW,

(f)the Secretary of State,

(g)the Environment Agency, and

(h)anyone else the Welsh Ministers think appropriate.

(5)Before publishing a statement under this section the Welsh Ministers must—

(a)lay a draft of the statement before the Assembly, and

(b)then wait until the end of the 40-day period.

(6)The Welsh Ministers may not publish the statement under this section if, within the 40-day period, the Assembly resolves not to approve it.

(7)The 40-day period” means the period of 40 days beginning with the day on which the draft is laid before the Assembly.

(8)When calculating the 40-day period, ignore any period during which the Assembly is dissolved or is in recess for more than 4 days.

(9)In this section “relevant functions relating wholly or mainly to Wales” means the functions mentioned in section 2(1)(b) so far as they relate to appointment areas wholly or mainly in Wales.

(10)In subsection (9) “appointment area” means an area for which an appointment is held under Chapter 1 of Part 2.]

Textual Amendments

F27Ss. 2A, 2B substituted for s. 2A (6.4.2015) by Water Act 2014 (c. 21), ss. 24(1), 94(3); S.I. 2015/773, art. 2(1)(c) (with art. 4)

3 General environmental and recreational duties.E+W

(1)It shall be the duty of each of the following, that is to say—

(a)the Secretary of State;

(b)F28. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)the Director; and

(d)every company holding an appointment as a relevant undertaker,

in formulating or considering any proposals relating to any functions of a relevant undertaker (including, in the case of such a company, any functions which, by virtue of that appointment, are functions of the company itself) to comply with the requirements imposed in relation to the proposals by subsections (2) and (3) below.

(2)The requirements imposed by this subsection in relation to any such proposals as are mentioned in subsection (1) above are—

(a)a requirement, so far as may be consistent—

(i)with the purposes of any enactment relating to the functions of the undertaker; and

(ii)in the case of the Secretary of State and the Director, with their duties under section 2 above,

so to exercise any power conferred with respect to the proposals on the person subject to the requirement as to further the conservation and enhancement of natural beauty and the conservation of flora, fauna and geological or physiographical features of special interest [F29and, in the case of the exercise of such a power by a company holding an appointment as a relevant undertaker, as to further water conservation] ;

(b)a requirement to have regard to the desirability of protecting and conserving buildings, sites and objects of archaeological, architectural or historic interest; and

(c)a requirement to take into account any effect which the proposals would have on the beauty or amenity of any rural or urban area or on any such flora, fauna, features, buildings, sites or objects.

(3)The requirements imposed by this subsection in relation to any such proposals as are mentioned in subsection (1) above are, subject to the requirements imposed by subsection (2) above—

(a)a requirement to have regard to the desirability of preserving for the public any freedom of access to areas of woodland, mountains, moor, heath, down, cliff or foreshore and other places of natural beauty;

(b)a requirement to have regard to the desirability of maintaining the availability to the public of any facility for visiting or inspecting any building, site or object of archaeological, architectural or historic interest; and

(c)a requirement to take into account any effect which the proposals would have on any such freedom of access or on the availability of any such facility.

(4)Subsections (1) to (3) above shall apply so as to impose duties on the Director and any company holding an appointment as a relevant undertaker in relation to any proposal relating to—

(a)the functions of [F30the Environment Agency]; F31...

[F32(aa)the functions of the NRBW; or]

(b)the functions of an internal drainage board,

as they apply in relation to any proposals relating to the functions of such an undertaker; and for the purposes of this subsection the reference in subsection (2)(a) above to the functions of the undertaker shall have effect as a reference to the functions of [F33the Environment Agency][F34, the NRBW,] or, as the case may be, of the internal drainage board in question.

(5)Subject to obtaining the consent of any navigation authority, harbour authority or conservancy authority before doing anything which causes navigation which is subject to the control of that authority to be obstructed or otherwise interfered with, it shall be the duty of every company holding an appointment as a relevant undertaker to take such steps as are—

(a)reasonably practicable; and

(b)consistent with the purposes of the enactments relating to the functions of the undertaker in question,

for securing, so long as that company has rights to the use of water or land associated with water, that those rights are exercised so as to ensure that the water or land is made available for recreational purposes and is so made available in the best manner.

(6)It shall be the duty of a company holding an appointment as a relevant undertaker, in determining what steps to take in performance of any duty imposed by virtue of subsection (5) above, to take into account the needs of persons who are chronically sick or disabled.

(7)The obligations under this section of a company holding an appointment as a relevant undertaker shall be enforceable under section 18 below by the Secretary of State.

(8)Nothing in this section or the following provisions of this Act shall require recreational facilities made available by a relevant undertaker to be made available free of charge.

(9)References in this section to the functions of a relevant undertaker shall be construed, without prejudice to section 156(7) below, as if those functions included the management, by a company holding an appointment as such an undertaker, of any land for the time being held by that company for any purpose whatever (whether or not connected with the carrying out of the functions of a relevant undertaker).

(10)In this section “building” includes structure.

Textual Amendments

F28S. 3(1)(b) repealed ( 27.3.2002) by The Ministry of Agriculture, Fisheries and Food (Dissolution) Order 2002; S.I. 2002/794, art. 5(2), 6, Sch. 2

F29Words in s. 3(2)(a) inserted (1.4.2004) by Water Act 2003 (c. 37), ss. 82, 105(3); S.I. 2004/641, art. 3(u) (with art. 6, Sch. 3)

F30Words in s. 3(4) substituted (1.4.1996) by 1995 c. 25, s. 120(1), Sch. 22 para. 97 (with ss. 7(6), 115, 117); S.I. 1996/186, art. 3

F33Words in s. 3(4) substituted (1.4.1996) by 1995 c. 25, s. 120(1), Sch. 22 para. 97 (with ss. 7(6), 115, 117); S.I. 1996/186, art. 3

4 Environmental duties with respect to sites of special interest.E+W

(1)Where [F35Natural England] or [F36the NRBW] are of the opinion that any area of land in England or, as the case may be, in Wales—

(a)is of special interest by reason of its flora, fauna or geological or physiographical features; and

(b)may at any time be affected by schemes, works, operations or activities of a relevant undertaker,

[F37Natural England or (as the case may be) [F38the NRBW]] shall notify the fact that the land is of special interest for that reason to every relevant undertaker whose works, operations or activities may affect the land.

(2)Where a National Park authority or the Broads Authority is of the opinion that any area of land in a National Park or in the Broads—

(a)is land in relation to which the matters for the purposes of which section 3 above has effect are of particular importance; and

(b)may at any time be affected by schemes, works, operations or activities of a relevant undertaker,

the National Park authority or Broads Authority shall notify the fact that the land is such land, and the reasons why those matters are of particular importance in relation to the land, to every relevant undertaker whose works, operations or activities may affect the land.

(3)Where a relevant undertaker has received a notification under subsection (1) or (2) above with respect to any land, that undertaker shall consult the notifying body before carrying out any works, operations or activities which appear to that undertaker to be likely—

(a)to destroy or damage any of the flora, fauna, or geological or physiographical features by reason of which the land is of special interest; or

(b)significantly to prejudice anything the importance of which is one of the reasons why the matters mentioned in subsection (2) above are of particular importance in relation to that land.

(4)Subsection (3) above shall not apply in relation to anything done in an emergency where particulars of what is done and of the emergency are notified to [F39Natural England], [F36the NRBW], the National Park authority in question or, as the case may be, the Broads Authority as soon as practicable after that thing is done.

(5)The obligations under this section of a relevant undertaker shall be enforceable under section 18 below by the Secretary of State.

(6)In this section—

  • the Broads” has the same meaning as in the M1Norfolk and Suffolk Broads Act 1988; F40. . .

  • F40. . .

and section 3(9) above shall apply, as it applies in relation to that section, for construing (in accordance with section 6 below) any references in this section to a relevant undertaker.

Textual Amendments

F40Definition of “National Park authority” and the word “and” immediately preceding it repealed (1.4.1997) by 1995 c. 25, s. 120(3), Sch. 24 (with ss. 7(6), 115, 117); S.I. 1996/2560, art. 2, Sch.

Marginal Citations

5 Codes of practice with respect to environmental and recreational duties.E+W

(1)The Secretary of State may by order approve any code of practice issued (whether by him or by another person) for the purpose of—

(a)giving practical guidance to relevant undertakers with respect to any of the matters for the purposes of which sections 3 and 4 above have effect; and

(b)promoting what appear to him to be desirable practices by such undertakers with respect to those matters,

and may at any time by such an order approve a modification of such a code or withdraw his approval of such a code or modification.

(2)A contravention of a code of practice as for the time being approved under this section shall not of itself constitute a contravention of any requirement imposed by section 3 or 4 above or give rise to any criminal or civil liability; but the Secretary of State F41. . . shall F42. . . be under a duty to take into account whether there has been or is likely to be any such contravention in determining when and how he should exercise his powers in relation to any relevant undertaker by virtue of this Act, any of the other consolidation Acts or the M2Water Act 1989.

(3)The power of the Secretary of State to make an order under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

(4)The Secretary of State shall not make an order under this section unless he has first consulted—

(a)[F43the Environment Agency] [F44and the NRBW];

(b)[F45Natural England] F46...;

(c)the Historic Buildings and Monuments Commission for England;

(d)the Sports Council and the Sports Council for Wales; and

(e)such relevant undertakers and other persons as he considers it appropriate to consult.

(5)In this section “the other consolidation Acts” means the M3Water Resources Act 1991, F47... the M4Land Drainage Act 1991 and the M5Water Consolidation (Consequential Provisions) Act 1991.

Part IIE+W APPOINTMENTMENT AND REGULATION OF UNDERTAKERS

CHAPTER IE+W APP0INTMENTS

Making of appointmentsE+W

6 Appointment of relevant undertakers.E+W

(1)Subject to the following provisions of this Chapter, a company may be appointed—

(a)by the Secretary of State; or

(b)with the consent of or in accordance with a general authorisation given by the Secretary of State, by the Director,

to be the water undertaker or sewerage undertaker for any area of England and Wales.

(2)Without prejudice to the obligation of a company holding an appointment under this Chapter to comply with the conditions of its appointment, the appointment of a company to be the water undertaker or sewerage undertaker for any area shall have the effect, while the appointment remains in force—

(a)of requiring the company to perform any duty imposed by or under any enactment on an undertaker of the relevant description (that is to say, a water undertaker or, as the case may be, sewerage undertaker);

(b)of authorising the company, for the purposes of, or in connection with, the carrying out of any of the functions of an undertaker of the relevant description, to exercise any power conferred by or under any enactment on an undertaker of that description;

(c)of requiring enactments and subordinate legislation authorising or requiring anything to be done in relation to an undertaker of the relevant description to be construed as authorising or requiring that thing to be done in relation to that company; and

(d)of requiring other references in any enactment or subordinate legislation to an undertaker of the relevant description, or to the area of that undertaker, to be construed, so far as necessary for the purposes of, or in connection with, the carrying out by that company of the functions of an undertaker of that description, as references to that company or, as the case may be, to that area.

(3)The appointment of a company to be a relevant undertaker shall be by service on the company of an instrument in writing containing the appointment and describing the area for which it is made.

(4)A single instrument may contain the appointment of a company to be the sewerage undertaker for an area and the appointment of the same company to be the water undertaker for the whole or any part of that area or for an area which includes the whole or any part of that area.

(5)A company shall not be appointed to be a water undertaker [F48or a sewerage undertaker] unless it is a limited company F49...

[F50(5A)A company shall not be appointed to be a relevant undertaker if it is a licensed water supplier.]

(6)As soon as practicable after making an appointment under this Chapter, the Secretary of State shall send a copy of the appointment to the Director.

7 Continuity of appointments, replacement appointments etc.E+W

(1)It shall be the duty of the Secretary of State to secure that such appointments are made under this Chapter as will ensure that for every area of England and Wales there is at all times both—

(a)a company holding an appointment under this Chapter as water undertaker; and

(b)whether or not the same company in relation to the whole or any part of that area, a company holding an appointment as sewerage undertaker.

(2)Subject to the following provisions of this section—

(a)the Secretary of State; and

(b)with the consent of or in accordance with a general authorisation given by the Secretary of State, the Director,

shall have power, by notice to a company holding an appointment under this Chapter, to terminate the appointment or to vary the area to which it relates.

(3)The appointment of a company to be a water undertaker or sewerage undertaker shall not be terminated or otherwise cease to relate to or to any part of any area except with effect from the coming into force of such appointments and variations replacing that company as a relevant undertaker as secure either-

(a)that another company becomes the water undertaker or, as the case may be, sewerage undertaker for that area or part or for an area that includes that area or part; or

(b)that two or more companies each become the water undertaker or, as the case may be, sewerage undertaker for one of a number of different areas that together constitute or include that area or part.

(4)An appointment or variation replacing a company as a relevant undertaker shall not be made in relation to the whole or any part of the area to which that company’s appointment as water undertaker or, as the case may be, sewerage undertaker relates except where—

(a)that company consents to the appointment or variation;

(b)the appointment or variation relates only to parts of that area none of the premises in which is served by that [F51company;

(bb)the appointment or variation relates only to parts of that area and the conditions mentioned in subsection (5) below are satisfied in relation to each of the premises in those parts which are served by that company; or]

(c)the appointment or variation is made in such circumstances as may be set out for the purposes of this paragraph in the conditions of that company’s appointment.

F52[(5)The conditions are that—

[F53(a)the premises are, or are likely to be, supplied with not less than the following quantity of water in any period of twelve months:

(i)if the area of the relevant undertaker concerned is wholly or mainly in Wales, 250 megalitres;

(ii)in all other cases, [F5450 megalitres] ; and]]

(b)the person who is the customer in relation to the premises consents in writing to the appointment or variation.

(6)The Secretary of State may, after consulting the Director, make regulations amending subsection (5)(a) above by substituting, for the quantity of water for the time being specified there, such smaller quantity as he considers appropriate.

Textual Amendments

F51Words and para. (bb) in s. 7(4) added (1.7.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 40(1); Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt. I

F52S. 7(5)(6) inserted (1.7.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 40(2): Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt. I

F53S. 7(5)(a) substituted (17.8.2000) by S.I. 2000/1842, art. 2(2)

8 Procedure with respect to appointments and variations.E+W

(1)An application for an appointment or variation replacing a company as a relevant undertaker shall be made in such manner as may be prescribed.

(2)Within fourteen days after making an application under this section, the applicant shall—

(a)serve notice of the application [F55on—

(i)the existing appointee,

(ii)if the application relates to the replacement of a water undertaker whose area is wholly or mainly in England, the Chief Inspector of Drinking Water,

(iii)if the application relates to the replacement of a water undertaker whose area is wholly or mainly in Wales, the Chief Inspector of Drinking Water for Wales if there is one, or the Chief Inspector of Drinking Water if section 86(1B)(b) applies,

(iv)the appropriate agency, and

(v)every] local authority whose area includes the whole or any part of the area to which the application relates; and

(b)publish a copy of the notice in such manner as may be prescribed.

(3)Before making an appointment or variation replacing a company as a relevant undertaker, the Secretary of State or the Director shall give notice—

(a)stating that he proposes to make the appointment or variation;

(b)stating the reasons why he proposes to make the appointment or variation; and

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed appointment or variation may be made.

(4)A notice under subsection (3) above shall be given—

(a)by publishing the notice in such manner as the Secretary of State or, as the case may be, the Director considers appropriate for bringing it to the attention of persons likely to be affected by the making of the proposed appointment or variation; and

(b)by serving a copy of the notice [F56on—

(i)the existing appointee,

(ii)if the proposed appointment or variation would replace a water undertaker whose area is wholly or mainly in England, the Chief Inspector of Drinking Water,

(iii)if the proposed appointment or variation would replace a water undertaker whose area is wholly or mainly in Wales, the Chief Inspector of Drinking Water for Wales if there is one, or the Chief Inspector of Drinking Water if section 86(1B)(b) applies,

(iv)the appropriate agency, and

(v)every] local authority whose area includes the whole or any part of the area to which the proposed appointment or variation relates.

(5)As soon as practicable after making an appointment or variation replacing a company as a relevant undertaker, the Secretary of State or the Director shall—

(a)serve a copy of the appointment or variation on the existing appointee; and

(b)serve notice of the making of the appointment or variation [F57on—

(i)if the appointment or variation replaces a water undertaker whose area is wholly or mainly in England, the Chief Inspector of Drinking Water,

(ii)if the appointment or variation replaces a water undertaker whose area is wholly or mainly in Wales, the Chief Inspector of Drinking Water for Wales if there is one, or the Chief Inspector of Drinking Water if section 86(1B)(b) applies,

(iii)the appropriate agency, and

(iv)every] local authority whose area includes the whole or any part of the area to which the appointment or variation relates,

and as soon as practicable after exercising any power to vary the area to which an appointment under this Chapter relates, the Secretary of State shall send a copy of the variation to the Director.

(6)In this section “the existing appointee”, in relation to an appointment or variation replacing a company as a relevant undertaker, means the company which is replaced in relation to the whole or any part of the area to which the appointment or variation relates or, where there is more than one such company, each of them.

[F58(6A)In this section “the appropriate agency”, in relation to the replacement of a relevant undertaker, means—

(a)the Environment Agency, if the undertaker's area is wholly in England;

(b)the NRBW, if the undertaker's area is wholly in Wales;

(c)both the Environment Agency and the NRBW, if the undertaker's area is partly in England and partly in Wales.]

F59[(7)The Secretary of State may by regulations impose such additional procedural requirements as he considers appropriate for any case where the conditions mentioned in section 7(5) above are required to be satisfied in relation to an application for an appointment or variation replacing a company as a relevant undertaker.]

Textual Amendments

F55Words in s. 8(2)(a) substituted (14.7.2014) by Water Act 2014 (c. 21), ss. 13(2), 94(2)(b)

F56Words in s. 8(4)(b) substituted (14.7.2014) by Water Act 2014 (c. 21), ss. 13(3), 94(2)(b)

F57Words in s. 8(5)(b) substituted (14.7.2014) by Water Act 2014 (c. 21), ss. 13(4), 94(2)(b)

F59S. 8(7) added (1.7.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 40(3); Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt. I

9 Duties affecting making of appointments and variations.E+W

(1)Before making an appointment or variation replacing a company as a relevant undertaker, the Secretary of State or the Director shall consider any representations or objections which have been duly made in pursuance of the notice under section 8(3) above and have not been withdrawn.

(2)Before making an appointment or variation replacing a company as a relevant undertaker, the Secretary of State shall consult the Director.

(3)In determining whether to make an appointment or variation by virtue of section 7(4)(b) [F60or (bb)] above in relation to any part of an area, the Secretary of State or, as the case may be, the Director shall have regard, in particular, to any arrangements made or expenditure incurred by the existing appointee for the purpose of enabling premises in that part of that area to be served by that appointee.

(4)It shall be the duty of the Secretary of State or, as the case may be, of the Director—

(a)in making an appointment or variation replacing a company as a relevant undertaker; and

(b)where he makes such an appointment or variation, in determining what provision is to be made with respect to the fixing by the new appointee of any water or drainage charges,

to ensure, so far as may be consistent with his duties under Part I of this Act, that the interests of the members and creditors of the existing appointee are not unfairly prejudiced as respects the terms on which the new appointee could accept transfers of property, rights and liabilities from the existing appointee.

(5)In this section—

  • existing appointee”, in relation to an appointment or variation replacing a company as a relevant undertaker in relation to any area or part of an area, means the company which is replaced by that appointment or variation;

  • new appointee”, in relation to such an appointment or variation, means the company which by virtue of the appointment or variation becomes a relevant undertaker for the area or part of an area in question;

  • water or drainage charges” means

(a)charges in respect of any services provided in the course of the carrying out of the functions of a water undertaker or sewerage undertaker; or

(b)amounts of any other description which such an undertaker is authorised by or under any enactment to require any person to pay.

Textual Amendments

F60Words in s. 9(3) inserted (1.7.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 40(4); Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt.I

10 Transitional provision with respect to replacement appointments.E+W

[(1)]Schedule 2 to this Act shall have effect for enabling provision to be made with respect to cases in which a company is replaced by another as a relevant undertaker by an appointment or variation under this Chapter.

F61[(2)Subsections (3) and (4) below apply where, by such an appointment or variation, one company (“the new undertaker”) is to replace another company as a relevant undertaker, but the appointment or variation has not come into force.

(3)The following provisions of this Act shall (except where they are inapplicable to the kind of undertaker in question) apply in relation to the new undertaker as if the appointment or variation had come into force—

(a)sections 18 to 24 and Schedule 3;

(b)sections 32 to 35;

(c)section 155 and Schedule 9;

(d)sections 156, 158 to 161 and 163 to 167 and Schedule 11;

(e)sections 168 to 171, 173, 174, 178 to 180 and Schedule 12;

(f)sections 181 to 183 and Schedule 13;

(g)sections 184 to 188 and Schedule 14;

(h)sections 189 to 192, 197 to 200, 202, 203, 206, 208, 209, 211, 212 and 217.

(4)Such of the conditions imposed on the new undertaker under section 11 below as the Director may specify in a written notice given by him to the undertaker shall have effect, in relation to the operation of any provision mentioned in subsection (3) above before the appointment or variation comes into force, as if the appointment or variation had come into force.

(5)The Secretary of State may by regulations amend subsection (3) above by adding to, removing or modifying references to provisions of this Act.]

Textual Amendments

F61S. 10(2)-(5) added (1.7.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 42; Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt.I

Modifications etc. (not altering text)

C13 S. 10 renumbered as subsection (1) of s. 10 (1.7.1992 ) by Competition and Service (Utilities) Act 1992 (c. 43), s.42; Competition and Service (Utilities) Act 1992 (Commencement No. 1) Order 1992 , art. 3, Sch. Pt. I

Conditions of appointmentsE+W

11 Power to impose conditions.E+W

(1)An appointment under this Chapter may include—

(a)such conditions as appear to the Secretary of State or, as the case may be, the Director to be requisite or expedient having regard to the duties imposed on him by Part I of this Act;

(b)conditions for the purposes of section 7(4)(c) above; and

(c)conditions requiring the rendering to the Secretary of State of a payment on the making of an appointment, or payments while such an appointment is in force, or both, of such amount or amounts as may be determined by or under the conditions.

(2)Conditions may be included by virtue of subsection (1)(a) above in an appointment under this Chapter whether or not they are connected with the supply of water, the provision of sewerage services or the exercise or performance of any power or duty conferred or imposed by or under any enactment on water undertakers or sewerage undertakers.

(3)Conditions included in an appointment under this Chapter may contain provision for the conditions to cease to have effect or be modified at such times, in such manner and in such circumstances as may be specified in or determined by or under the conditions.

(4)Any provision included by virtue of subsection (3) above in an appointment under this Chapter shall have effect in addition to the provision made by this Chapter with respect to the modification of the conditions of an appointment.

(5)For the purposes of this Act where the same instrument contains an appointment of the same company to be both a water undertaker and a sewerage undertaker (whether or not for the same area), all the conditions included in that instrument by virtue of this section shall have effect, irrespective of their subject-matter, as conditions of both appointments.

(6)Where an instrument of appointment has been served under subsection (3) of section 6 above on any company, the coming into force of the appointment for the purposes specified in subsection (2) of that section shall not be affected by any contravention of the requirements of this Act with respect to the provision contained by way of conditions of appointment in that instrument.

(7)If the Secretary of State considers it appropriate to do so in consequence of any legal proceedings with respect to any such provision as is mentioned in subsection (6) above, he may by order made by statutory instrument direct that such conditions as may be specified in the order are to be treated as included in the appointment in question until there is an opportunity for the provision to which the proceedings relate to be replaced by virtue of any of the other provisions of this Chapter.

(8)Any sums received by the Secretary of State in consequence of the provisions of any condition of an appointment under this Chapter shall be paid into the Consolidated Fund.

12 Determinations under conditions of appointment.E+W

(1)Without prejudice to the generality of paragraph (a) of section 11(1) above, conditions included in an appointment by virtue of that paragraph may—

(a)require the appointed company to comply with any direction given by the Director as to such matters as are specified in the appointment or are of a description so specified; and

(b)require the appointed company, except in so far as the Director consents to the company’s doing or not doing them, not to do or to do such things as are specified in the appointment or are of a description so specified.

(2)Without prejudice as aforesaid, such conditions may provide for the reference to and determination by—

(a)the Secretary of State or the Director; or

(b)on a reference by the Director, the [F62CMA] ,

of such questions arising under the appointment and of such other matters, including (in the case of references to [F63the CMA] ) disputes as to determinations by the Director, as are specified in the appointment or are of a description so specified.

(3)Where any question or other matter falls to be determined by the [F64CMA] in pursuance of a provision contained in an appointment under this Chapter—

(a)it shall be the duty of the Director, on being required to do so by the company holding that appointment, to refer that question or matter to [F65the CMA] ; and

(b)it shall be the duty of [F65the CMA] to determine any question or other matter referred by virtue of paragraph (a) above in accordance with—

(i)F66. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(ii)the principles which apply, by virtue of Part I of this Act, in relation to determinations under this Chapter by the Director.

[F67(3A)For the purposes of subsection (3) above, where—

(a)the question or matter referred to the [F68CMA] concerns the review of a price control imposed on the company holding the appointment; and

(b)the [F68CMA] is to decide to what extent it is reasonable to take into account in its determination costs incurred or borne by the company in connection with the reference,

the [F68CMA] shall also have regard to the extent to which, in its view, its determination is likely to support the company’s (rather than the Authority's) claims in relation to the question or matter referred to it.

(3B)Subsections (4) and (5) of section 14, and [F69sections 14A and 14B], below apply to references to the [F70CMA] under this section as they apply to references under section 14.

(3C)A report of the [F70CMA] on a reference under this section—

(a)shall be made to the Authority; and

(b)shall include definite conclusions on the questions or other matters comprised in the reference, together with such an account of their reasons for those conclusions as, in the opinion of the [F70CMA] , is expedient for facilitating a proper understanding of those questions or other matters and of their conclusions,

and subsections (5) and (6) of section 15 below apply to such a report as they apply to a report on a reference under section 14.]

[F71(3D)The functions of the CMA with respect to a reference under this section are to be carried out on behalf of the CMA by a group constituted for the purpose by the chair of the CMA under Schedule 4 to the Enterprise and Regulatory Reform Act 2013 (including functions relating to the making of modifications following a report on a reference, and functions under sections 109 to 115 of the Enterprise Act 2002, as applied by subsection (3B) read with section [F7214B]).]

(4)F73. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)F73. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F66S. 12(3)(b)(i) repealed (1.10.2004) by Water Act 2003 (c. 37), ss. 54(3), 105(3), Sch. 9 Pt. 2; S.I. 2004/2528, art. 2(h)(u) (with art. 4, Sch.)

F67S. 12(3A)-(3C) inserted (1.10.2004) by Water Act 2003 (c. 37), ss. 54(2), 105(3); S.I. 2004/2528, art. 2(h) (with art. 4, Sch.)

F69Words in s. 12(3B) substituted (14.7.2014) by Water Act 2014 (c. 21), s. 94(2)(s), Sch. 7 para. 8(a)

F72Word in s. 12(3D) substituted (14.7.2014) by Water Act 2014 (c. 21), s. 94(2)(s), Sch. 7 para. 8(b)

Modification of appointment conditionsE+W

13 Modification by agreement.E+W

(1)Subject to the following provisions of this section, the Director may modify the conditions of a company’s appointment under this Chapter if the company consents to the modifications.

(2)Before making modifications under this section, the Director shall give notice—

(a)stating that he proposes to make the modifications and setting out their effect;

(b)stating the reasons why he proposes to make the modifications; and

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(3)A notice under subsection (2) above shall be given—

(a)by publishing the notice in such manner as the Director considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the modifications; and

(b)by serving a copy of the notice on the company and on the Secretary of State.

(4)The Director shall not under this section make any modifications which the Secretary of State has, within the time specified in the notice under subsection (2) above, directed the Director not to make.

(5)The Secretary of State shall not give a direction under subsection (4) above in relation to any modification unless—

(a)the modification is a modification of provision contained in the appointment for the purposes of section 7(4)(c) above;

(b)the modification is a modification of a provision of the appointment which relates to the disposal of, or of interests or rights in or over, a company’s protected land and is stated in the appointment to be a provision which cannot be modified; or

(c)it appears to the Secretary of State that the modification should be made, if at all, under section 16 below.

14 Modification references to [F74CMA].E+W

(1)The Director may make to the [F75CMA] a reference which is so framed as to require [F76the CMA] to investigate and report on the questions—

(a)whether any matters which—

(i)relate to the carrying out of any function which is a function of any company by virtue of an appointment of that company under this Chapter; and

(ii)are specified in the reference,

operate, or may be expected to operate, against the public interest; and

(b)if so, whether the effects adverse to the public interest which those matters have or may be expected to have could be remedied or prevented by modifications of the conditions of the company’s appointment.

(2)The Director may, at any time, by notice given to the [F77CMA] vary a reference under this section by—

(a)adding to the matters specified in the reference; or

(b)excluding from the reference some or all of the matters so specified;

and on receipt of any such notice [F78the CMA] shall give effect to the variation.

(3)The Director may specify in a reference under this section, or a variation of such a reference, for the purpose of assisting the [F79CMA] in carrying out the investigation on the reference—

(a)any effects adverse to the public interest which, in his opinion, the matters specified in the reference or variation have or may be expected to have; and

(b)any modifications of the conditions of any appointment mentioned in the reference or variation by which, in his opinion, those effects could be remedied or prevented.

(4)As soon as practicable after making a reference under this section or a variation of such a reference, the Director shall—

(a)serve a copy of the reference or variation on the company whose appointment is mentioned in the reference or variation; and

(b)publish particulars of the reference or variation in such manner as he considers appropriate for the purpose of bringing the reference or variation to the attention of persons likely to be affected by it.

(5)It shall be the duty of the Director, for the purpose of assisting the [F80CMA] in carrying out an investigation on a reference under this section [F81or in carrying out functions under section 16A below], to give to [F82the CMA]

(a)any information in his possession which relates to matters falling within the scope of the investigation [F83or the carrying out of those functions], and which is either—

(i)requested by [F82the CMA] for that purpose; or

(ii)information which, in his opinion, it would be appropriate for that purpose to give to [F82the CMA] without any such request;

and

(b)any other assistance which [F82the CMA] may require, and which it is within his power to give, in relation to any such matters;

and [F82the CMA], for the purpose of carrying out any such investigation [F84or such functions], shall take account of any information given to them for that purpose under this subsection.

(6)In determining for the purposes of this section whether any particular matter operates, or may be expected to operate, against the public interest, the [F85CMA] shall have regard to the matters as respects which duties are imposed on the Secretary of State and the Director by Part I of this Act.

[F86(6A)The functions of the CMA with respect to a reference under this section are to be carried out on behalf of the CMA by a group constituted for the purpose by the chair of the CMA under Schedule 4 to the Enterprise and Regulatory Reform Act 2013 (including functions relating to the making of modifications following a report on a reference, and functions under sections 109 to 115 of the Enterprise Act 2002, as applied by sections 14B and 16B).]

(7)F87. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7A)F87. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8)F88. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8A)F88. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F81Words in s. 14(5) inserted (1.10.2004) by Water Act 2003 (c. 37), ss. 55(2)(a), 105(3); S.I. 2004/2528, art. 2(h) (with savings in art. 4, Sch.)

F83Words in s. 14(5) inserted (1.10.2004) by Water Act 2003 (c. 37), ss. 55(2)(b), 105(3); S.I. 2004/2528, art. 2(h) (with savings in art. 4, Sch.)

F84Words in s. 14(5) inserted (1.10.2004) by Water Act 2003 (c. 37), ss. 55(2)(c), 105(3); S.I. 2004/2528, art. 2(h) (with savings in art. 4, Sch.)

F87S. 14(7)(7A) repealed (20.6.2003) by Enterprise Act 2002 (c. 40), ss. 278, 279, Sch. 25 para. 25(4), Sch. 26; S.I. 2003/1397, art. 2(1), Sch. (with savings in art. 8)

[F8914A References under section 14: time limitsE+W

(1)Every reference under section 14 above shall specify a period (not longer than six months beginning with the date of the reference) within which a report on the reference is to be made.

(2)A report of the [F90CMA] on a reference under section 14 above shall not have effect (and no action shall be taken in relation to it under section 16 below) unless the report is made before the end of the period specified in the reference or such further period (if any) as may be allowed by the Director under subsection (3) below.

(3)The Director may, if he has received representations on the subject from the [F90CMA] and is satisfied that there are special reasons why the report cannot be made within the period specified in the reference, extend that period by no more than six months.

(4)No more than one extension is possible under subsection (3) above in relation to the same reference.

(5)The Director shall, in the case of an extension made by him under subsection (3) above—

(a)publish that extension in such manner as he considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it; and

(b)send a copy of what has been published by him under paragraph (a) above to the company whose appointment is mentioned in the reference.

14B References under section 14: powers of investigationE+W

(1)The following sections of Part 3 of the Enterprise Act 2002 shall apply, with the modifications mentioned in subsections [F91(1A),] (2) and (3) below, for the purposes of references under section 14 above as they apply for the purposes of references under that Part—

(a)section 109 (attendance of witnesses and production of documents etc.);

(b)section 110 (enforcement of powers under section 109: general);

(c)section 111 (penalties);

(d)section 112 (penalties: main procedural requirements);

(e)section 113 (payments and interest by instalments);

(f)section 114 (appeals in relation to penalties);

(g)section 115 (recovery of penalties); and

(h)section 116 (statement of policy).

[F92(1A)Section 109 shall, in its application by virtue of subsection (1) above, have effect as if—

(a)for subsection (A1), there were substituted—

(A1)For the purposes of this section, a permitted purpose is assisting the CMA in carrying out any functions exercisable by it in connection with a reference under section 14 of the Water Industry Act 1991., and

(b)subsection (8A) were omitted.]

(2)Section 110 shall, in its application by virtue of subsection (1) above, have effect as if—

(a)subsection (2) were omitted; F93...

[F94(aa)after subsection (3), there were inserted—

(3A)No penalty shall be imposed by virtue of subsection (1) or (3) if more than 4 weeks have passed since the publication of the report of the CMA on the reference concerned; but this subsection shall not apply in relation to any variation or substitution of the penalty which is permitted by virtue of this Part.; and]

(b)in subsection (9) the words from “or section” to “section 65(3))” were omitted.

[F95(3)Section 111(5)(b) shall, in its application by virtue of subsection (1) above, have effect as if for sub-paragraph (ii) there were substituted—

(ii)if earlier, the day on which the report of the CMA on the reference concerned is made or, if no such report is made within the period permitted for that purpose, the latest day on which the report may be made within the permitted period..]

(4)Provisions of Part 3 of the Enterprise Act 2002 which have effect for the purposes of sections 109 to 116 of that Act (including, in particular, provisions relating to offences and the making of orders) shall, for the purposes of the application of those sections by virtue of subsection (1) above, have effect in relation to those sections as applied by virtue of that subsection.

(5)Accordingly, corresponding provisions of this Act shall not have effect in relation to those sections as applied by virtue of that subsection.]

15 Reports on modification references.E+W

(1)In making a report on a reference under section 14 above, the [F96CMA]

(a)shall include in the report definite conclusions on the questions comprised in the reference together with such an account of their reasons for those conclusions as, in their opinion, is expedient for facilitating a proper understanding of those questions and of their conclusions;

(b)where they conclude that any of the matters specified in the reference operate, or may be expected to operate, against the public interest, shall specify in the report the effects adverse to the public interest which those matters have or may be expected to have; and

(c)where they conclude that any adverse effects so specified could be remedied or prevented by modifications of the conditions of a company’s appointment under this Chapter, shall specify in the report modifications by which those effects could be remedied or prevented.

[F97(1A)For the purposes of section 16 below, a conclusion contained in a report of the [F98CMA] is to be disregarded if the conclusion is not that of at least two-thirds of the members of the group constituted [F99by the chair of the CMA for the purpose of carrying out the functions of the CMA with respect to the reference].

(1B)If a member of a group so constituted disagrees with any conclusions contained in a report made on a reference under section 14 above as the conclusions of the [F100CMA], the report shall, if the member so wishes, include a statement of his disagreement and of his reasons for disagreeing.]

F101(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F102(3)For the purposes of the law relating to defamation, absolute privilege attaches to any report made by the [F103CMA] on a reference under section 14 above.

(3A)In making any report on a reference under section 14 above the [F103CMA] must have regard to the following considerations before disclosing any information.

(3B)The first consideration is the need to exclude from disclosure (so far as practicable) any information whose disclosure the [F103CMA] thinks is contrary to the public interest.

(3C)The second consideration is the need to exclude from disclosure (so far as practicable)—

(a)commercial information whose disclosure the [F103CMA] thinks might significantly harm the legitimate business interests of the undertaking to which it relates, or

(b)information relating to the private affairs of an individual whose disclosure the [F103CMA] thinks might significantly harm the individual’s interests.

(3D)The third consideration is the extent to which the disclosure of the information mentioned in subsection (3C)(a) or (b) above is necessary for the purposes of the report.]

(4)A report of the [F104CMA] on a reference under section 14 above shall be made to the Director.

(5)Subject to subsection (6) below, the Director—

(a)shall, on receiving such a report, send a copy of it to the company to whose appointment under this Chapter the report relates and to the Secretary of State; and

(b)shall, not less than fourteen days after that copy is received by the Secretary of State, publish another copy of that report in such manner as he considers appropriate for bringing the report to the attention of persons likely to be affected by it.

(6)If it appears to the Secretary of State that the publication of any matter in such a report would be against the public interest or the commercial interests of any person, he may, before the end of the period of fourteen days mentioned in paragraph (b) of subsection (5) above, direct the Director to exclude that matter from every copy of the report to be published by virtue of that paragraph; and the Director shall comply with any such direction.

16 Modification following report.E+W

(1)Where a report of the [F105CMA] on a reference under section 14 above—

(a)includes conclusions to the effect that any of the matters specified in the reference operate, or may be expected to operate, against the public interest;

(b)specifies effects adverse to the public interest which those matters have or may be expected to have;

(c)includes conclusions to the effect that those effects could be remedied or prevented by modifications of the conditions of a company’s appointment under this Chapter; and

(d)specifies modifications by which those effects could be remedied or prevented,

the Director shall, subject to the following provisions of this section, make such modifications of the conditions of that appointment as appear to him requisite for the purpose of remedying or preventing the adverse effects specified in the report.

(2)Before making modifications under this section, the Director shall have regard to the modifications specified in the report.

(3)Before making modifications under this section, the Director shall give notice—

(a)stating that he proposes to make the modifications and setting out their effect;

(b)stating the reasons why he proposes to make the modifications; and

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(4)A notice under subsection (3) above shall be given—

(a)by publishing the notice in such manner as the Director considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by the making of the modifications; and

(b)by serving a copy of the notice on the company whose appointment it is proposed to modify.

[F106(4A)After considering any representations or objections made in response to proposals set out in a notice under subsection (3) above, the Authority shall give notice to the [F107CMA]

(a)setting out the modifications it proposes to make to remedy or prevent the adverse effects specified in the report; and

(b)stating the reasons for making the modifications.

(4B)The Authority shall include with the notice under subsection (4A) above a copy of any representations or objections received in relation to the notice under subsection (3) above.

(4C)If the period of four weeks from the date on which the notice under subsection (4A) above is given elapses without a direction under section 16A(1)(a) below having been given to it, the Authority shall—

(a)make the modifications set out in the notice; or

(b)if a direction under section 16A(1)(b) below has been given, make the modifications which are not specified in the direction.]

(5)The Director shall not under this section make any modification of any provisions of a company’s appointment under this Chapter which—

(a)are contained in that appointment for the purposes of section 7(4)(c) above; or

(b)being provisions relating to the disposal of, or of interests or rights in or over, a company’s protected land, are stated in the appointment to be provisions which cannot be modified.

[F10816A [F109CMA's] power of veto following reportE+W

(1)[F110The CMA] may, within the period of four weeks after the date on which it is given a notice under section 16(4A) above, direct the Authority—

(a)not to make the modifications set out in that notice; or

(b)not to make such of the modifications as may be specified in the direction;

and the Authority shall comply with any such direction.

(2)The Secretary of State may, within the period of four weeks after the date on which the [F111CMA] is given a notice under section 16(4A) above and on the application of the [F111CMA], direct that the period for giving a direction under subsection (1) above (and, accordingly, the period mentioned in section 16(4C) above) shall be extended by fourteen days.

(3)The power to give a direction under subsection (1) above may only be exercised in respect of such of the modifications set out in the notice under section 16(4A)(a) above as appear to the [F111CMA] not to be the modifications which are requisite for the purpose of remedying or preventing all or any of the adverse effects specified in the report as effects which could be remedied or prevented by modifications.

(4)If the [F111CMA] gives a direction under subsection (1) above, it—

(a)shall give notice setting out the modifications proposed by the Authority, the terms of the direction and the reasons for giving it; and

(b)shall itself make such modifications as appear to it to be requisite for the purpose of remedying or preventing—

(i)if the direction was given under subsection (1)(a) above, the adverse effects specified in the report as effects which could be remedied or prevented by modifications;

(ii)if the direction was given under subsection (1)(b) above, such of those adverse effects as are not remedied or prevented by the modifications made by the Authority under section 16(4C)(b) above.

(5)In exercising its power under subsection (4)(b) above, the [F111CMA] shall have regard to the matters to which the Authority is required to have regard when determining the conditions of a company’s appointment.

(6)Before making modifications under subsection (4)(b) above the [F111CMA] shall give notice—

(a)stating that it proposes to make the modifications and setting them out;

(b)stating the reason why it proposes to make them;

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(7)A notice under subsection (4)(a) or (6) above shall be given—

(a)by publishing the notice in such manner as the [F111CMA] considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications; and

(b)by serving a copy on the Authority and the company whose conditions of appointment it is proposed should be modified.

(8)The [F111CMA] may not make any modification under this section which the Authority could not make under section 16 above.

(9)After making modifications under this section the [F111CMA] shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.

F112(10). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

16B [F113CMA's] power of veto following report: supplementaryE+W

(1)For the purposes of the law relating to defamation, absolute privilege attaches to any notice under subsection (4)(a), (6) or (9) of section 16A above.

(2)In giving any notice under subsection (4)(a) or (6) of section 16A above, or publishing any notice under subsection (9) of that section, the [F114CMA] must have regard to the following considerations before disclosing any information.

(3)The first consideration is the need to exclude from disclosure (so far as practicable) any information whose disclosure the [F114CMA] thinks is contrary to the public interest.

(4)The second consideration is the need to exclude from disclosure (so far as practicable)—

(a)commercial information whose disclosure the [F114CMA] thinks might significantly harm the legitimate business interests of the undertaking to which it relates; or

(b)information relating to the private affairs of an individual whose disclosure the [F114CMA] thinks might significantly harm the individual’s interests.

(5)The third consideration is the extent to which the disclosure of the information mentioned in subsection (4)(a) or (b) above is necessary for the purposes of the notice.

(6)The following sections of Part 3 of the Enterprise Act 2002 shall apply, with the modifications mentioned in subsections [F115(6A),] (7) and (8) below, for the purposes of any investigation by the [F116CMA] for the purposes of the exercise of its functions under section 16A above, as they apply for the purposes of any investigations on references under that Part—

(a)section 109 (attendance of witnesses and production of documents etc);

(b)section 110 (enforcement of powers under section 109: general);

(c)section 111 (penalties);

(d)section 112 (penalties: main procedural requirements);

(e)section 113 (payments and interest by instalments);

(f)section 114 (appeals in relation to penalties);

(g)section 115 (recovery of penalties); and

(h)section 116 (statement of policy).

[F117(6A)Section 109 shall, in its application by virtue of subsection (6) above, have effect as if—

(a)for subsection (A1), there were substituted—

(A1)For the purposes of this section, a permitted purpose is assisting the CMA in carrying out any functions exercisable by it in connection with an investigation for the purposes of the exercise of its functions under section 16A of the Water Industry Act 1991., and

(b)subsection (8A) were omitted.]

(7)Section 110 shall, in its application by virtue of subsection (6) above, have effect as if—

(a)subsection (2) were omitted;

[F118(b)after subsection (3), there were inserted—

(3A)No penalty shall be imposed by virtue of subsection (1) or (3) if more than 4 weeks have passed since the publication by the CMA of a notice under section 16A(9) of the Water Industry Act 1991 in connection with the reference concerned or, if no direction has been given by the CMA under section 16A(1) of that Act in connection with the reference concerned and within the period permitted for that purpose, the latest day on which it was possible to give such a direction within the permitted period; but this subsection shall not apply in relation to any variation or substitution of the penalty which is permitted by virtue of this Part.; and]

(c)in subsection (9) the words from “or section” to “section 65(3))” were omitted.

(8)Section 111(5)(b) shall, in its application by virtue of subsection (6) above, have effect as if for sub-paragraph (ii) there were substituted—

(ii)if earlier, the day on which a notice is published by the [F119CMA] under section 16A(9) of the Water Industry Act 1991 in connection with the reference concerned or, if no direction is given by the [F119CMA] under section 16A(1) of that Act in connection with the reference concerned and within the period permitted for that purpose, the latest day on which such a direction may be given within the permitted period.

(9)Provisions of Part 3 of the Enterprise Act 2002 which have effect for the purposes of sections 109 to 116 of that Act (including, in particular, provisions relating to offences and the making of orders) shall, for the purposes of the application of those sections by virtue of subsection (6) above, have effect in relation to those sections as applied by virtue of that subsection.

(10)Accordingly, corresponding provisions of this Act shall not have effect in relation to those sections as applied by virtue of that subsection.]

Textual Amendments

F108Ss. 16A, 16B inserted (1.10.2004) by Water Act 2003 (c. 37), ss. 55(4), 105(3); S.I. 2004/2528, art. 2(h) (with art. 4, Sch.)

17 Modification by order under other enactments.E+W

[F120(1)Where the [F121CMA] or (as the case may be) the Secretary of State (in this section “the relevant authority”) makes a relevant order, the order may, subject to subsection (3), also provide for the modification of the conditions of a company’s appointment under this Chapter to such extent as may appear to the relevant authority to be requisite or expedient for the purpose of giving effect to, or taking account of, any provision made by the order.

(2)In subsection (1) above “relevant order” means—

(a)an order under section 75, 83 or 84 of, or paragraph 5, 10 or 11 of Schedule 7 to, the 2002 Act where—

(i)one or more than one of the enterprises which have, or may have, ceased to be distinct enterprises was carried on by a relevant undertaker; or

(ii)one or more than one of the enterprises which will or may cease to be distinct enterprises is carried on by a relevant undertaker; or

(b)an order under section 160 or 161 of the 2002 Act where the feature, or combination of features, of the market [F122or markets] in the United Kingdom for goods or services which prevents, restricts or distorts competition is—

(i)the structure or an aspect of the structure of a market for the supply of goods or services by a relevant undertaker; or

(ii)the conduct of a relevant undertaker or of customers of a relevant undertaker.]

(3)No modification shall be made by virtue of this section of any provisions of a company’s appointment under this Chapter which—

(a)are contained in that appointment for the purposes of section 7(4)(c) above; or

(b)being provisions relating to the disposal of, or of interests or rights in or over, a company’s protected land, are stated in the appointment to be provisions which cannot be modified.

[F123(4)Expressions used in subsection (2) above and in Part 3 or (as the case may be) Part 4 of the 2002 Act have the same meanings in that subsection as in that Part.]

Textual Amendments

F120S. 17(1)(2) substituted (20.6.2003 for all purposes subject to art. 3(1) of the first commencing S.I. and 29.12.2004 "for water purposes") by Enterprise Act 2002 (c. 40), s. 168(9), 279, Sch. 9 para. 7(2); S.I. 2003/1397, art. 2(1), Sch.; S.I. 2004/3233, art. 2, Sch. (with arts. 3-5)

F123S. 17(4) substituted (20.6.2003 for all purposes subject to art. 3(1) of the first commencing S.I. and 29.12.2004 "for water purposes") by Enterprise Act 2002 (c. 40), s. 168(9), 279, Sch. 9 para. 7(3); S.I. 2003/1397, art. 2(1), Sch.; S.I. 2004/3233, art. 2, Sch. (with arts. 3-5)

Modifications etc. (not altering text)

[F124CHAPTER 1AE+W LICENSING OF WATER SUPPLIERS

Textual Amendments

F124Pt. 2 Ch. 1A inserted (1.4.2004 for specified provisions and purposes and 1.8.2005 for further specified provisions and purposes and 1.10.2005 for further specified provisions and 1.12.2005 otherwise) by Water Act 2003 (c. 37), ss. 56, 105(3), Sch. 4 para. 2; S.I. 2004/641, art. 3(l), Sch. 1 (with art. 6, Sch. 3); S.I. 2005/968, art. 3(b) (with savings in art. 4, Sch. 1, 2); S.I. 2005/2714, arts. 2(h), 3(a) (with Sch. para. 5)

Modifications etc. (not altering text)

Granting of licencesE+W

[F12517AWater supply licencesE+W

(1)The Authority may grant to a person a licence in respect of the use of the supply system of a water undertaker (a “water supply licence”).

(2)A water supply licence may give the holder of the licence one or more of the following authorisations and combination of authorisations—

(a)a retail authorisation;

(b)a wholesale authorisation;

(c)a restricted retail authorisation;

(d)a restricted retail authorisation and a supplementary authorisation.

(3)Schedule 2A makes provision as to the authorisations (including their operation in England and Wales).

(4)In the case of each of the authorisations, an authorisation to do a thing is an authorisation to do it in accordance with Chapter 2A of Part 3.

(5)The Authority may exercise the power to grant a water supply licence only in accordance with a general authorisation given by the Secretary of State.

(6)Before giving a general authorisation as regards the Authority, the Secretary of State must consult the Welsh Ministers.

(7)References in this Act to a water supply licensee are references to a person that is the holder for the time being of a water supply licence.]

Textual Amendments

F125Ss. 17A, 17AA substituted for s. 17A (1.1.2016 for the substitution of s. 17A(2)-(6)) by Water Act 2014 (c. 21), ss. 1(1), 94(3); S.I. 2015/1938, art. 3(a)(i) (with art. 4)

[F12517AAWater supply licences: restrictions on grantsE+W

(1)Before the Authority grants a water supply licence giving a wholesale authorisation, it must consult—

(a)the Secretary of State;

(b)the Chief Inspector of Drinking Water;

(c)the Environment Agency;

(d)the NRBW.

(2)Before the Authority grants a water supply licence giving a supplementary authorisation, it must consult—

(a)the Secretary of State;

(b)the Chief Inspector of Drinking Water;

(c)the Environment Agency;

(d)the Welsh Ministers;

(e)the Chief Inspector of Drinking Water for Wales if there is one;

(f)the NRBW.

(3)A water supply licence may not be granted to a water undertaker.

(4)A water supply licence may not be granted to a person unless that person is a limited company.

(5)The restriction in subsection (4) does not apply if the water supply licence gives only—

(a)a retail authorisation,

(b)a restricted retail authorisation, or

(c)a retail authorisation and a restricted retail authorisation.]

Textual Amendments

F125Ss. 17A, 17AA substituted for s. 17A (1.1.2016 for the substitution of s. 17A(2)-(6)) by Water Act 2014 (c. 21), ss. 1(1), 94(3); S.I. 2015/1938, art. 3(a)(i) (with art. 4)

17BSection 17A: supplementaryE+W

(1)The Authority shall publish guidance issued under section 17A(9) above in such manner as the Authority considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.

(2)The Authority may, with the approval of the Secretary of State, revise the guidance so issued.

(3)Before giving his approval to guidance revised under subsection (2) above, the Secretary of State shall consult the Assembly.

(4)Subsection (1) above applies to guidance revised under subsection (2) above as it applies to guidance issued under section 17A(9) above.

(5)In this Chapter, references to the supply system of a water undertaker are to the system comprising the following—

(a)any water mains and other pipes which it is the water undertaker’s duty to develop and maintain by virtue of section 37 below and which are used for the purpose of conveying water from the undertaker’s treatment works to the premises of customers; and

(b)any water mains and other pipes which—

(i)are used by the undertaker for the purpose of conveying non-domestic water from any of its sources to the premises of customers; and

(ii)are not connected to any water mains or pipes falling within paragraph (a) above or to any water mains or other pipes connected to the treatment works mentioned in that paragraph (whether directly or indirectly),

and in sub-paragraph (i) above the reference to non-domestic water is to water supplied other than for domestic or food production purposes.

(6)In subsection (5)(a) above, the reference to treatment works is a reference to the works designated from time to time by the Secretary of State as treatment works for the purposes of this subsection.

(7)Before designating any works for the purposes of subsection (6) above, the Secretary of State shall consult the Assembly.

(8)A list of any works designated for the purposes of subsection (6) above shall be published from time to time by the Secretary of State in such manner as he considers appropriate for the purpose of bringing the designations to the attention of persons likely to be affected by them.

(9)References in this Act to a licensed water supplier are references to a company which is the holder for the time being of a water supply licence.

[F12617BASewerage licencesE+W

(1)The Authority may grant to a person a licence in respect of the use of the sewerage system of a sewerage undertaker whose area is wholly or mainly in England (a “sewerage licence”).

(2)A sewerage licence may give the holder of the licence one or more of the following—

(a)a retail authorisation;

(b)a wholesale authorisation;

(c)a disposal authorisation.

(3)Schedule 2B makes provision as to the authorisations.

(4)In the case of each of the authorisations, an authorisation to do a thing is an authorisation to do it in accordance with Chapter 2A of Part 4.

(5)The Authority may exercise the power to grant a sewerage licence only in accordance with a general authorisation given by the Secretary of State.

(6)References in this Act to a sewerage licensee are references to a person that is the holder for the time being of a sewerage licence.

(7)References in this Chapter to the sewerage system of a sewerage undertaker are references to the system comprising—

(a)the system of public sewers, the facilities for emptying public sewers and the sewage disposal works and other facilities for dealing effectually with the contents of public sewers that the undertaker is required to provide by section 94, and

(b)the lateral drains that the undertaker is required to maintain by section 94.

Textual Amendments

F126Ss. 17BA, 17BB inserted (1.1.2016 for the insertion of s. 17BA(2)-(5)) by Water Act 2014 (c. 21), ss. 4(1), 94(3); S.I. 2015/1938, art. 3(b)(i)

17BBSewerage licences: restrictions on grantsE+W

(1)The Authority must consult the Secretary of State, the Environment Agency and the NRBW before granting a licence that gives—

(a)a wholesale authorisation, or

(b)a disposal authorisation.

(2)A sewerage licence granted to a sewerage undertaker may not give the holder—

(a)a retail authorisation, or

(b)a wholesale authorisation.

(3)A sewerage licence may not be granted to a person unless that person is a limited company.

(4)The restriction in subsection (3) does not apply if the sewerage licence gives only a retail authorisation.]

Textual Amendments

F126Ss. 17BA, 17BB inserted (1.1.2016 for the insertion of s. 17BA(2)-(5)) by Water Act 2014 (c. 21), ss. 4(1), 94(3); S.I. 2015/1938, art. 3(b)(i)

17CMeaning of household premisesE+W

(1)For the purposes of [F127paragraphs 4 and 7(a) of Schedule 2A and paragraph 2 of Schedule 2B], “household premises” means premises in which, or in any part of which, a person has his home.

(2)The fact that a person has his home in, or in part of, any premises does not mean that the premises are household premises unless the principal use of the premises is as a home.

(3)The Secretary of State may by regulations make provision as to—

(a)the circumstances in which a person is or is not to be treated as having his home in, or in part of, any premises for the purposes of this section; and

(b)the factors which are, or are not, to be taken into account in determining the principal use of any premises for those purposes.

(4)The power to make regulations under subsection (3) above is exercisable by the Assembly (and not by the Secretary of State) in relation to premises supplied with water using the supply system of a water undertaker whose area is wholly or mainly in Wales.

Textual Amendments

F127Words in s. 17C(1) substituted (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 11; S.I. 2015/1938, art. 3(f)(i)

17DThe threshold requirementE+W

(1)This section applies for the purpose of construing the reference to the threshold requirement in [F128paragraph 7(b) of Schedule 2A] in relation to the supply of water to any premises [F129in accordance with a restricted retail authorisation].

(2)The requirement is that, at the time when the licensed water supplier first enters into an undertaking with a customer to give the supply, the total quantity of water estimated to be supplied to the premises annually pursuant to the undertaking [F130is not less than—

(a)5 megalitres, in the case of premises supplied with water using the supply system of a water undertaker whose area is wholly or mainly in England, and

(b)50 megalitres, in the case of premises supplied with water using the supply system of a water undertaker whose area is wholly or mainly in Wales].

(3)Any estimate of the quantity of water to be supplied to any premises for the purposes of subsection (2) above shall be made in accordance with guidance issued by the Authority with the approval of the Secretary of State.

(4)Any guidance issued under subsection (3) above may, in particular—

(a)specify—

(i)the factors to be, and not to be, taken into account;

(ii)the assumptions to be made; and

(iii)the method of calculation to be employed,

in making estimates; and

(b)make provision as to the commencement of the annual periods by reference to which estimates are to be made.

(5)Before giving his approval to any guidance issued under that subsection, the Secretary of State shall consult the Assembly.

(6)Subsections (1) to (4) of section 17B above apply to guidance issued under subsection (3) above as they apply to guidance issued under section 17A(9) above.

(7)The Secretary of State may make provision by regulations as to the circumstances in which a licensed water supplier is not, for the purposes of subsection (2) above, to be treated as entering into an undertaking with a new customer to give a supply of water to any premises (subject to subsection (12) below).

(8)The Secretary of State may by regulations amend subsection (2) above by substituting, for the quantity of water for the time being specified there, a different quantity of water (subject to subsection (12) below).

(9)Regulations under subsection (8) above—

(a)shall include provision for the amendment made by the regulations not to apply in relation to any undertaking entered into before the date on which the regulations come into force; and

(b)may include provision for that amendment not to apply in relation to any undertaking which is proposed, but not entered into, before that date.

(10)A statutory instrument containing regulations under subsection (8) above shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.

(11)Before making regulations under subsection (8) above, the Secretary of State shall consult—

(a)the Authority; and

(b)such other persons (if any) as the Secretary of State thinks it appropriate to consult.

(12)The powers to make regulations under subsections (7) and (8) above are exercisable by the Assembly (and not by the Secretary of State) in relation to premises supplied with water using the supply system of a water undertaker whose area is wholly or mainly in Wales.

(13)Subsections (9) and (11) above apply in relation to regulations made by the Assembly under subsection (8) above by virtue of subsection (12) above as they apply in relation to regulations made by the Secretary of State under subsection (8) above.

Textual Amendments

F128Words in s. 17D(1) substituted (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 12(2)(a); S.I. 2015/1938, art. 3(f)(ii) (with art. 4)

[F13117DAGuidanceE+W

The Authority must publish guidance issued from time to time under—

(a)section 17D(3),

(b)paragraph 10 of Schedule 2A, or

(c)paragraph 4 of Schedule 2B,

in such manner as the Authority considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.]

17EDeterminations by the AuthorityE+W

(1)The Authority may determine, in a case referred to it by a licensed water supplier or a potential customer of a licensed water supplier, whether a proposed supply of water by the supplier to the customer would be in accordance with the retail authorisation given to the supplier in the licence.

(2)The matters which the Authority may determine include the following matters—

(a)the extent of the premises to be supplied for the purposes of section 17A(3) above;

(b)whether the premises to be supplied are household premises (as defined in section 17C above); and

(c)whether the threshold requirement is satisfied in relation to the premises to be supplied (construed in accordance with section 17D above),

and also include any other matter the determination of which is relevant to those matters.

17FProcedure for granting water supply licencesE+W

(1)An application for—

(a)a water supply licence;

(b)the variation of a retail licence so that it gives also the supplementary authorisation; or

(c)the variation of a combined licence so that it gives only the retail authorisation,

shall be made in such form and manner, and shall contain, or be accompanied by, such information and documents and such fee (if any), as may be prescribed.

F132(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F133(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4)If F134... the Authority proposes to refuse the application, F135... it shall give to the applicant a notice—

(a)stating that F135... it proposes to refuse the application;

(b)stating the reasons why F135... it proposes to refuse the application; and

(c)specifying the time within which representations or objections with respect to the proposed refusal may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

F136(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)A licence shall be in writing and, unless revoked or suspended in accordance with any condition contained in it, shall continue in force for such period as may be specified in or determined by or under the licence.

(7)As soon as practicable after granting a licence or variation of a licence, F137... the Authority shall serve a copy of the licence or licence as varied—

(a)on the licence holder;

(b)on the Assembly;

(c)on the Chief Inspector of Drinking Water;

(d)on the Environment Agency;

[F138(da)on the NRBW;]

(e)on the Council;

(f)on each relevant undertaker;

(g)on each licensed water supplier (other than the holder of the licence in question);

F139(h). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(i)F140... on the Secretary of State.

(8)Any sums received F141... by the Authority by virtue of this section shall be paid into the Consolidated Fund.

[F14217FAApplications forwarded by the Water Industry Commission for ScotlandE+W

(1)The Secretary of State may by regulations make provision about—

(a)treating a 2005 Act application for the grant of a water services licence under section 6 of the 2005 Act as being also an application under section 17F for the grant of a water supply licence giving only a retail authorisation or a restricted retail authorisation or both;

(b)treating a 2005 Act application for the grant of a sewerage services licence under section 6 of the 2005 Act as being also an application under section 17F for the grant of a sewerage licence giving only a retail authorisation.

(2)The regulations may in particular make provision about—

(a)the circumstances in which, and the conditions subject to which, a 2005 Act application is to be treated as an application under section 17F for a water supply or sewerage licence giving a particular authorisation or particular authorisations;

(b)the time at which an application is to be treated as having been made;

(c)the processing of an application by the Authority.

(3)Provision under subsection (2)(a) may require a 2005 Act application that is forwarded to the Authority—

(a)to contain, or to be accompanied by, such information or information of such description as is specified by the regulations;

(b)to be accompanied by such documents or documents of such descriptions as are specified by the regulations;

(c)to be accompanied by a fee, or a fee of a description, specified by the regulations.

(4)In this section and section 17FB—

  • the 2005 Act” means the Water Services etc. (Scotland) Act 2005;

  • 2005 Act application” means an application under paragraph 1 of Schedule 2 to the 2005 Act.

Textual Amendments

F142Ss. 17FA, 17FB inserted (18.12.2015 for the insertion of s. 17FA) by Water Act 2014 (c. 21), ss. 6(2), 94(3); S.I. 2015/1938, art. 2(a)(ii)

17FBApplications forwarded to the Water Industry Commission for ScotlandE+W

(1)If the conditions in subsection (2) are satisfied, the Authority must—

(a)forward to the Commission a copy of an application under section 17F for the grant of a water supply licence or sewerage licence, and

(b)send to the Commission such information and such fee as appear to the Authority to be required in order that the application may be treated by the Commission as a 2005 Act application for the grant of—

(i)a water services licence under section 6 of the 2005 Act, or

(ii)a sewerage services licence under section 6 of the 2005 Act, as the case may be.

(2)The conditions are that—

(a)the Authority is requested to do so by the applicant;

(b)the application under section 17F appears to the Authority to be an application that would be treated by the Commission as a 2005 Act application for the grant of—

(i)a water services licence under section 6 of the 2005 Act, or

(ii)a sewerage services licence under section 6 of the 2005 Act, as the case may be;

(c)the applicant has given the Authority—

(i)such information as is mentioned in subsection (1)(b), and

(ii)a means of sending to the Commission such fee as is mentioned in subsection (1)(b).

(3)The Authority must—

(a)forward a copy of the application, and

(b)send such information and fee as are mentioned in subsection (1)(b),

before the end of the agreed period for an application of that description.

(4)In this section—

  • the agreed period”, in relation to an application under section 17F of a particular description, means the period agreed between the Authority and the Commission as the period applying to an application of that description for the purposes of subsection (3);

  • the Commission” means the Water Industry Commission for Scotland.]

Textual Amendments

F142Ss. 17FA, 17FB inserted (18.12.2015 for the insertion of s. 17FA) by Water Act 2014 (c. 21), ss. 6(2), 94(3); S.I. 2015/1938, art. 2(a)(ii)

Licence conditionsU.K.

17G[F143Licence conditions]U.K.

(1)[F144A licence under this Chapter] may include—

(a)such conditions as appear to F145... the Authority to be requisite or expedient having regard to the duties imposed on F146... it by Part 1 of this Act;

(b)conditions requiring the rendering to [F147the Authority] of a payment on the grant of a [F148licence under this Chapter], or payments while such a licence is in force, or both, of such amount or amounts as may be determined by or under the conditions.

(2)Conditions may be included by virtue of subsection (1)(a) above in a water supply licence whether or not they are connected with the supply of water or the introduction of water into a water undertaker’s supply system.

[F149(2A)Conditions may be included by virtue of subsection (1)(a) in a sewerage licence whether or not they are connected with—

(a)effectual dealing with the contents of sewers, or

(b)the use of the sewerage system of a sewerage undertaker.]

(3)Conditions included in a [F150licence under this Chapter] may—

(a)require the holder of the licence to comply with any direction given by a specified relevant person as to specified matters or matters which are of a specified description;

(b)require the holder of the licence to do or not to do specified things or things which are of a specified description, except in so far as a specified relevant person consents to the holder’s not doing or doing them; and

(c)provide for the reference to and determination by a specified relevant person of specified questions, or questions which are of a specified description, which arise under or in connection with the licence.

(4)For the purposes of subsection (3) above—

(a)the following are relevant persons—

(i)the Secretary of State;

(ii)the Authority;

(iii)[F151so far as subsection (3) applies to water supply licences,] the Assembly;

(iv)the Environment Agency; F152...

[F153(v)the NRBW; and]

(b)specified” means specified in the licence in question.

(5)Conditions included in a [F154licence under this Chapter] may contain provision for the conditions to have effect, cease to have effect or be modified at such times, in such manner and in such circumstances as may be specified in or determined in accordance with the conditions.

(6)Any such condition as is referred to in subsection (5) above shall have effect in addition to the provision made by this Chapter with respect to the modification of the conditions of a licence.

(7)Any sums received by [F155the Authority] by virtue of this section shall be paid into the Consolidated Fund.

Textual Amendments

F147Words in s. 17G(1)(b) substituted (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 16(3)(d); S.I. 2015/1938, art. 3(f)(vii)

F148Words in s. 17G(1)(b) substituted (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 16(3)(e); S.I. 2015/1938, art. 3(f)(vii)

F151Words in s. 17G(4)(a)(iii) inserted (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 16(6); S.I. 2015/1938, art. 3(f)(vii)

Modifications etc. (not altering text)

17HStandard conditions of water supply licencesU.K.

[F156(1)The Secretary of State may determine the conditions that are to be the standard conditions of water supply licences granted by the Authority.

(1A)Before determining the standard conditions, the Secretary of State must consult the Welsh Ministers as regards conditions relating to a restricted retail authorisation or a supplementary authorisation.

(1B)The Secretary of State is to publish the standard conditions in such manner as the Secretary of State considers appropriate.

(2)The standard conditions may be different depending on the different authorisations or combinations of authorisations to which the conditions are to relate.

(3)The power to determine standard conditions in relation to water supply licences giving a particular authorisation or a particular combination of authorisations may be exercised only before the grant of the first licence to give that authorisation or that particular combination of authorisations (but this is without prejudice to the power to modify standard conditions in accordance with the provisions of this Chapter).]

(4)The standard conditions for the purposes of water supply licences [F157giving any particular authorisation or combination of authorisations] may contain provision—

(a)for any standard condition included in a licence of that description not to have effect until brought into operation in such manner and in such circumstances as may be specified in or determined under the standard conditions;

(b)for the effect of any standard condition included in such a licence to be suspended in such manner, and in such circumstances, as may be so specified or determined; and

(c)for any standard condition included in such a licence which is for the time being suspended to be brought back into operation in such manner and in such circumstances as may be so specified or determined.

(5)Subject to subsection (6) below, each condition which is a standard condition shall be incorporated by reference in each water supply licence (or in each such licence to which the standard condition applies).

(6)Subject to the following provisions of this section, F158... the Authority may, in granting a licence, exclude or modify any of the standard conditions to such extent as F159... it considers requisite to meet the circumstances of a particular case.

(7)Before excluding any standard conditions or making any modifications under subsection (6) above, F160... the Authority shall give notice—

(a)stating that F161... it proposes to exclude the conditions or make the modifications and setting out the effect of so doing;

(b)stating the reasons why F162... it proposes to exclude the conditions or make the modifications; and

(c)specifying the time (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed exclusions or modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(8)A notice under subsection (7) above shall be given—

(a)by publishing the notice in such manner as F163... the Authority considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the exclusions or modifications; and

(b)by serving a copy of the notice—

[F164(i)if the notice relates to a water supply licence giving a restricted retail authorisation or a restricted retail authorisation and a supplementary authorisation, on the Welsh Ministers;]

(ii)on the Chief Inspector of Drinking Water;

F165(iii). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(iv)F166... on the Secretary of State.

[F167(v)on the Water Industry Commission for Scotland.]

(9)If, within the time specified in the notice under subsection (7) above, the Secretary of State (after consulting [F168the Welsh Ministers in a case where notice was served on them under subsection (8)(b)(i)]) directs the Authority not to exclude or modify any standard condition, the Authority shall comply with the direction.

(10)The F169... Authority shall not exclude any conditions, or make any modifications, under subsection (6) above unless F170... it is of the opinion that the exclusions or modifications are such that—

(a)the licence holder would not be unduly disadvantaged in competing with other holders of water supply licences; and

(b)no other holder of a water supply licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence).

(11)The modification under subsection (6) above of part of a standard condition shall not prevent any other part of the condition from continuing to be treated as a standard condition for the purposes of this Chapter.

Textual Amendments

F166Words in s. 17H(8)(b)(iv) repealed (1.1.2016) by Water Act 2014 (c. 21), s. 94(3), Sch. 7 para. 17(6)(d); S.I. 2015/1938, art. 3(f)(vii)

Modifications etc. (not altering text)

[F17117HAStandard conditions of sewerage licencesU.K.

(1)The Secretary of State may determine the conditions that are to be the standard conditions of sewerage licences granted by the Authority.

(2)The Secretary of State is to publish the standard conditions in such manner as the Secretary of State considers appropriate.

(3)The standard conditions may be different depending on the different authorisations or combinations of authorisations to which the conditions are to relate.

(4)The power to determine standard conditions in relation to sewerage licences giving a particular authorisation or a particular combination of authorisations may be exercised only before the grant of the first licence to give that authorisation or that particular combination of authorisations (but this is without prejudice to the power to modify standard conditions in accordance with the provisions of this Chapter).

(5)The standard conditions for the purposes of sewerage licences giving any particular authorisation or combination of authorisations may contain provision—

(a)for any standard condition included in a licence of that description not to have effect until brought into operation in such manner and in such circumstances as may be specified in or determined under the standard conditions;

(b)for the effect of any standard condition included in such a licence to be suspended in such manner, and in such circumstances, as may be so specified or determined; and

(c)for any standard condition included in such a licence which is for the time being suspended to be brought back into operation in such manner and in such circumstances as may be so specified or determined.

(6)Subject to subsection (7), each condition which is a standard condition is to be incorporated by reference in each sewerage licence (or in each such licence to which the standard condition applies).

(7)Subject to the following provisions of this section, the Authority may, in granting a licence, exclude or modify any of the standard conditions to such extent as the Authority considers requisite to meet the circumstances of a particular case.

(8)Before excluding any standard conditions or making any modifications under subsection (7), the Authority must give notice—

(a)stating that the Authority proposes to exclude the conditions or make the modifications and setting out the effect of so doing;

(b)stating the reasons why the Authority proposes to exclude the conditions or make the modifications; and

(c)specifying the time (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed exclusions or modifications may be made,

and the Authority must consider any representations or objections which are duly made and not withdrawn.

(9)A notice under subsection (8) must be given—

(a)by publishing the notice in such manner as the Authority considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the exclusions or modifications; and

(b)by serving a copy of the notice—

(i)on the Secretary of State;

(ii)on the Environment Agency;

(iii)on the NRBW;

(iv)on the Water Industry Commission for Scotland.

(10)If, within the time specified in the notice under subsection (8), the Secretary of State directs the Authority not to exclude or modify any standard condition, the Authority must comply with the direction.

(11)The Authority may not exclude any conditions, or make any modifications, under subsection (7) unless the Authority is of the opinion that the exclusions or modifications are such that—

(a)the licence holder would not be unduly disadvantaged in competing with other holders of sewerage licences; and

(b)no other holder of a sewerage licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence being granted).

(12)The modification under subsection (7) of part of a standard condition is not to prevent any other part of the condition from continuing to be treated as a standard condition for the purposes of this Chapter.]

17IModification of water supply licences by agreementU.K.

(1)Subject to the following provisions of this section, the Authority may modify the conditions of a particular water supply licence.

(2)The Authority may not make any modifications under this section unless the licence holder has consented to the modifications and, in the case of standard conditions of the licence, the Authority is of the opinion that the modifications—

(a)are requisite to meet the circumstances of the particular case; and

(b)are such that—

(i)the licence holder would not be unduly disadvantaged in competing with other holders of water supply licences; and

(ii)no other holder of a water supply licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence being modified).

(3)Before making modifications under this section, the Authority shall give notice—

(a)stating that it proposes to make the modifications and setting out their effect;

(b)stating the reasons why it proposes to make the modifications; and

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(4)A notice under subsection (3) above shall be given—

(a)by publishing the notice in such manner as the Authority considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the modifications; and

(b)by serving a copy of the notice on—

(i)the licence holder;

(ii)the Council;

(iii)the Secretary of State;

(iv)the Assembly; and

(v)the Chief Inspector of Drinking Water.

(5)If, within the period specified in the notice under subsection (3) above, the Secretary of State (after consulting the Assembly) directs the Authority not to make any modification, the Authority shall comply with the direction.

(6)The modification under this section of part of a standard condition of a licence shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Chapter.

Modifications etc. (not altering text)

17JModification of standard conditions of water supply licencesU.K.

(1)Subject to the following provisions of this section, the Authority may modify the standard conditions of retail licences or combined licences.

(2)Where at any time the Authority modifies the standard conditions of retail licences or combined licences under this section the Authority may make such incidental or consequential modifications as it considers necessary or expedient of any conditions of any licence of that description.

(3)Before making any modifications under this section, the Authority shall give notice—

(a)stating that it proposes to make the modifications and setting out their effect;

(b)stating the reasons why it proposes to make the modifications; and

(c)specifying the time (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(4)A notice under subsection (3) above shall be given—

(a)by publishing the notice in such manner as the Authority considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the modifications; and

(b)by serving a copy of the notice on—

(i)each relevant licence holder;

(ii)the Council;

(iii)the Secretary of State;

(iv)the Assembly; and

(v)the Chief Inspector of Drinking Water.

(5)If, within the time specified in the notice under subsection (3) above, the Secretary of State (after consulting the Assembly) directs the Authority not to make any modification, the Authority shall comply with the direction.

(6)The Authority may not under this section make any modifications of the standard conditions of retail licences or combined licences unless—

(a)no notice of objection to those modifications is given by any relevant licence holder to the Authority within the time specified in the notice under subsection (3) above;

(b)if one or more relevant licence holders give notice of objection to the Authority within that time—

(i)the proportion (expressed as a percentage) of the relevant licence holders who have given notice of objection is less than such percentage as may be specified in an order made by statutory instrument by the Secretary of State; and

(ii)the percentage given by subsection (7) below is less than such percentage as may be so specified; or

(c)subsection (8) below applies to the case.

(7)The percentage given by this subsection is the proportion (expressed as a percentage) of the relevant licence holders who have given notice of objection, weighted according to their market share at such time and in such manner as may be specified in an order under subsection (6) above.

(8)This subsection applies where the Authority is satisfied that—

(a)the effect of the standard conditions is such as to impose a burden affecting relevant licence holders in the carrying on of activities to which the modifications relate;

(b)the modifications would remove or reduce the burden without removing any necessary protection; and

(c)the modifications are such that no holder of a water supply licence would be unduly disadvantaged in competing with other holders of such licences.

(9)An order under subsection (6) above may include such supplemental, consequential and transitional provision as the Secretary of State considers appropriate.

(10)Before making an order under subsection (6) above, the Secretary of State shall consult the Assembly.

(11)A statutory instrument containing an order under subsection (6) above shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.

(12)Where the Authority modifies the standard conditions of retail licences or combined licences, the Authority shall—

(a)also make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that description granted after that time; and

(b)publish the modifications in such manner as it considers appropriate.

(13)In this section “relevant licence holder”, in relation to proposed modifications of standard conditions of retail licences or combined licences, means the holder of a licence of that description—

(a)which is to be modified under the proposals by the inclusion of any new standard condition; or

(b)which includes any standard conditions to which the proposals relate, other than standard conditions which are not in effect (by virtue of anything done under section 17H(4) above) at the time specified in the notice under subsection (3) above.

Modifications etc. (not altering text)

17KWater supply licences: modification references to [F172CMA] U.K.

(1)The Authority may make to the [F173CMA] a reference which is so framed as to require the [F174CMA to] investigate and report on the questions—

(a)whether any matters which—

(i)relate to the carrying on of activities authorised or regulated by a particular licence; and

(ii)are specified in the reference,

operate, or may be expected to operate, against the public interest; and

(b)if so, whether the effects adverse to the public interest which those matters have, or may be expected to have, could be remedied or prevented by modifications of the conditions of the licence.

(2)The Authority may make to the Commission a reference which is so framed as to require the [F175CMA] to investigate and report on the questions—

(a)whether any matters which—

(i)relate to the carrying on of activities authorised or regulated by retail licences or combined licences; and

(ii)are specified in the reference,

operate, or may be expected to operate, against the public interest; and

(b)if so, whether the effects adverse to the public interest which those matters have, or may be expected to have, could be remedied or prevented by modifications of the standard conditions of licences of that description.

(3)The Authority may, at any time, by notice given to the [F175CMA] vary a reference under this section by—

(a)adding to the matters specified in the reference; or

(b)excluding from the reference some of the matters so specified,

and on receipt of any such notice the [F175CMA] shall give effect to the variation.

(4)The Authority may specify in a reference under this section, or a variation of such a reference, for the purpose of assisting the [F175CMA] in carrying out the investigation on the reference—

(a)any effects adverse to the public interest which, in its opinion, the matters specified in the reference or variation have or may be expected to have; and

(b)any modifications of the relevant conditions by which, in its opinion, those effects could be remedied or prevented.

(5)As soon as practicable after making a reference under this section or a variation of such a reference, the Authority shall—

(a)publish particulars of the reference or variation in such manner as it considers appropriate for the purpose of bringing the reference or variation to the attention of persons likely to be affected by it; and

(b)serve a copy of the reference or variation on—

(i)the licence holder or, as the case may be, the relevant licence holders;

(ii)the Council;

(iii)the Secretary of State;

(iv)the Assembly; and

(v)the Chief Inspector of Drinking Water.

(6)If, before the end of the period of twenty-eight days beginning with the day on which the Secretary of State receives the copy of the reference or variation, the Secretary of State directs the [F176CMA]

(a)not to proceed with the reference; or

(b)not to give effect to the variation,

the [F176CMA] shall comply with the direction.

(7)It shall be the duty of the Authority, for the purpose of assisting the [F176CMA] in carrying out an investigation on a reference under this section or in carrying out functions under section 17P below, to give to the [F176CMA]

(a)any information in the Authority’s possession which relates to matters falling within the scope of the investigation or the carrying out of those functions and which is either—

(i)requested by the [F176CMA] for that purpose; or

(ii)information which, in the Authority’s opinion, it would be appropriate for that purpose to give to the [F176CMA] without any such request; and

(b)any other assistance which the [F176CMA] may require, and which it is within the Authority’s power to give, in relation to any such matters,

and the [F176CMA] , for the purpose of carrying out any such investigation or such functions, shall take account of any information given to it for that purpose under this subsection.

(8)In this section and the following provisions of this Chapter—

  • relevant conditions”—

    (a)

    in relation to a reference under subsection (1) above, means the conditions of the licence to which the reference relates; and

    (b)

    in relation to a reference under subsection (2) above, means the standard conditions of the licences to which the reference relates; and

  • relevant licence holder” means the holder of a licence to which a reference under subsection (2) above relates.

(9)In determining for the purposes of this section whether any particular matter operates, or may be expected to operate, against the public interest, the [F177CMA] shall have regard to the matters as respects which duties are imposed on the Secretary of State and the Authority by Part 1 of this Act.

[F178(10)The functions of the CMA with respect to a reference under this section are to be carried out on behalf of the CMA by a group constituted for the purpose by the chair of the CMA under Schedule 4 to the Enterprise and Regulatory Reform Act 2013 (including functions relating to the making of modifications following a report on a reference, and functions under sections 109 to 115 of the Enterprise Act 2002, as applied by sections 17M and 17Q).]

Textual Amendments

Modifications etc. (not altering text)

17LReferences under section 17K: time limitsU.K.

(1)Every reference under section 17K above shall specify a period (not longer than six months beginning with the date of the reference) within which a report on the reference is to be made.

(2)A report of the [F179CMA] on a reference under section 17K above shall not have effect (and no action shall be taken in relation to it under section 17O below) unless the report is made before the end of the period specified in the reference or such further period (if any) as may be allowed by the Authority under subsection (3) below.

(3)The Authority may, if it has received representations on the subject from the [F179CMA] and is satisfied that there are special reasons why the report cannot be made within the period specified in the reference, extend that period by no more than six months.

(4)No more than one extension is possible under subsection (3) above in relation to the same reference.

(5)The Authority shall, in the case of an extension made by it under subsection (3) above—

(a)publish that extension in such manner as the Authority considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it; and

(b)send a copy of what has been published by it under paragraph (a) above to the holder of the licence or, as the case may be, the relevant licence holders.

17MReferences under section 17K: powers of investigationU.K.

(1)The following sections of Part 3 of the Enterprise Act 2002 shall apply, with the modifications mentioned in subsections [F180(1A),] (2) and (3) below, for the purposes of references under section 17K above as they apply for the purposes of references under that Part—

(a)section 109 (attendance of witnesses and production of documents etc);

(b)section 110 (enforcement of powers under section 109: general);

(c)section 111 (penalties);

(d)section 112 (penalties: main procedural requirements);

(e)section 113 (payments and interest by instalments);

(f)section 114 (appeals in relation to penalties);

(g)section 115 (recovery of penalties); and

(h)section 116 (statement of policy).

[F181(1A)Section 109 shall, in its application by virtue of subsection (1) above, have effect as if—

(a)for subsection (A1), there were substituted—

(A1)For the purposes of this section, a permitted purpose is assisting the CMA in carrying out any functions exercisable by it in connection with a reference under section 17K of the Water Industry Act 1991., and

(b)subsection (8A) were omitted.]

(2)Section 110 shall, in its application by virtue of subsection (1) above, have effect as if—

(a)subsection (2) were omitted; F182...

[F183(aa)after subsection (3), there were inserted—

(3A)No penalty shall be imposed by virtue of subsection (1) or (3) if more than 4 weeks have passed since the publication of the report of the CMA on the reference concerned; but this subsection shall not apply in relation to any variation or substitution of the penalty which is permitted by virtue of this Part.; and]

(b)in subsection (9) the words from “or section” to “section 65(3))” were omitted.

[F184(3)Section 111(5)(b) shall, in its application by virtue of subsection (1) above, have effect as if for sub-paragraph (ii) there were substituted—

(ii)if earlier, the day on which the report of the CMA on the reference concerned is made or, if no such report is made within the period permitted for that purpose, the latest day on which the report may be made within the permitted period..]

(4)Provisions of Part 3 of the Enterprise Act 2002 which have effect for the purposes of sections 109 to 116 of that Act (including, in particular, provisions relating to offences and the making of orders) shall, for the purposes of the application of those sections by virtue of subsection (1) above, have effect in relation to those sections as applied by virtue of that subsection.

(5)Accordingly, corresponding provisions of this Act shall not have effect in relation to those sections as applied by virtue of that subsection.

Textual Amendments

Modifications etc. (not altering text)

17NWater supply licences: reports on modification referencesU.K.

(1)In making a report on a reference under section 17K above, the [F185CMA]

(a)shall include in the report definite conclusions on the questions comprised in the reference together with such an account of its reasons for those conclusions as in its opinion is expedient for facilitating a proper understanding of those questions and of its conclusions;

(b)where it concludes that any of the matters specified in the reference operate, or may be expected to operate, against the public interest, shall specify in the report the effects adverse to the public interest which those matters have or may be expected to have; and

(c)where it concludes that any adverse effects so specified could be remedied or prevented by modifications of the relevant conditions, shall specify in the report modifications by which those effects could be remedied or prevented.

(2)For the purposes of section 17O below, a conclusion contained in a report of the [F186CMA] is to be disregarded if the conclusion is not that of at least two-thirds of the members of the group constituted [F187by the chair of the CMA for the purpose of carrying out the functions of the CMA with respect to the reference].

(3)If a member of a group so constituted disagrees with any conclusions contained in a report made on a reference under section 17K above as the conclusions of the [F188CMA], the report shall, if the member so wishes, include a statement of his disagreement and of his reasons for disagreeing.

(4)For the purposes of the law relating to defamation, absolute privilege attaches to any report made by the [F188CMA] on a reference under section 17K above.

(5)In making any report on a reference under section 17K above the [F188CMA] must have regard to the following considerations before disclosing any information.

(6)The first consideration is the need to exclude from disclosure (so far as practicable) any information whose disclosure the [F188CMA] thinks is contrary to the public interest.

(7)The second consideration is the need to exclude from disclosure (so far as practicable)—

(a)commercial information whose disclosure the [F188CMA] thinks might significantly harm the legitimate business interests of the undertaking to which it relates; or

(b)information relating to the private affairs of an individual whose disclosure the [F188CMA] thinks might significantly harm the individual’s interests.

(8)The third consideration is the extent to which the disclosure of the information mentioned in subsection (7)(a) or (b) above is necessary for the purposes of the report.

(9)A report of the [F189CMA] on a reference under section 17K above shall be made to the Authority.

(10)Subject to subsection (13) below, the Authority shall—

(a)on receiving a report on a reference under section 17K(1) above, serve a copy of it on—

(i)the licence holder;

(ii)the Council;

(iii)the Secretary of State; and

(iv)the Assembly; and

(b)not earlier than the relevant time, publish another copy of the report in such manner as it considers appropriate for bringing the report to the attention of persons likely to be affected by it.

(11)Subject to subsection (13) below, the Authority shall—

(a)on receiving a report on a reference under section 17K(2) above, serve a copy of it on—

(i)the Secretary of State; and

(ii)the Assembly; and

(b)not earlier than the relevant time—

(i)serve another copy on each relevant licence holder; and

(ii)not less than twenty-four hours after complying with sub-paragraph (i) above, publish another copy of the report in such manner as it considers appropriate for bringing the report to the attention of persons likely to be affected by it.

(12)For the purposes of subsections (10) and (11) above, the “relevant time” means—

(a)fourteen days after the copy of the report in question is received by the Secretary of State and the Assembly, or

(b)if copies are received by them on different days, fourteen days after the later day.

(13)Subsection (14) below applies if it appears to the Secretary of State that the publication of any matter in a report on a reference under section 17K(1) or (2) above would be against—

(a)the public interest; or

(b)the commercial interests of any person.

(14)The Secretary of State may, not later than the relevant time for the purposes of subsection (10) or (11) above, direct the Authority to exclude that matter from the copy of the report, or (as the case may be) each copy of the report, to be served and published as mentioned in paragraph (b) of that subsection; and the Authority shall comply with any such direction.

17OWater supply licences: modification following reportU.K.

(1)Where a report of the [F190CMA] on a reference under section 17K above—

(a)includes conclusions to the effect that any of the matters specified in the reference operate, or may be expected to operate, against the public interest;

(b)specifies effects adverse to the public interest which those matters have or may be expected to have;

(c)includes conclusions to the effect that those effects could be remedied or prevented by modifications of the relevant conditions; and

(d)specifies modifications by which those effects could be remedied or prevented,

the Authority shall, subject to the following provisions of this section, make such modifications of the relevant conditions as appear to it requisite for the purpose of remedying or preventing the adverse effects specified in the report.

(2)Where at any time it modifies under subsection (1) above the standard conditions of retail licences or combined licences in consequence of a reference under section 17K(2) above, the Authority may make such incidental or consequential modifications as it considers necessary or expedient of any conditions of licences of that description.

(3)Before making modifications under this section, the Authority shall have regard to the modifications specified in the report.

(4)Before making modifications under this section, the Authority shall give notice—

(a)stating that it proposes to make the modifications and setting out their effect;

(b)stating the reasons why it proposes to make the modifications; and

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(5)A notice under subsection (4) above shall be given—

(a)by publishing the notice in such manner as the Authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by the making of the modifications;

(b)by serving a copy of the notice on the holder of the licence in question or, as the case may be, the relevant licence holders; and

(c)by serving a copy of the notice on—

(i)the Council;

(ii)the Secretary of State;

(iii)the Assembly; and

(iv)the Chief Inspector of Drinking Water.

(6)After considering any representations or objections made in response to proposals set out in a notice under subsection (4) above, the Authority shall give notice to the [F191CMA]

(a)setting out the modifications it proposes to make to remedy or prevent the adverse effects specified in the report; and

(b)stating the reasons for making the modifications.

(7)The Authority shall include with the notice under subsection (6) above a copy of any representations or objections received in relation to the notice under subsection (4) above.

(8)If the period of four weeks from the date on which the notice under subsection (6) above is given elapses without a direction under section 17P(1)(a) below having been given to it, the Authority shall—

(a)make the modifications set out in the notice; or

(b)if a direction under section 17P(1)(b) below has been given, make the modifications which are not specified in the direction.

(9)The modification under subsection (1) above of part of a standard condition of a particular licence in consequence of a reference under section 17K(1) above shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Chapter.

(10)Where at any time it modifies under subsection (1) above the standard conditions of retail licences or combined licences in consequence of a reference under section 17K(2) above, the Authority shall—

(a)also make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that description granted after that time; and

(b)publish the modifications made for those purposes in such manner as it considers appropriate.

17PWater supply licences: [F192CMA's] power of veto following reportU.K.

(1)The [F193CMA] may, within the period of four weeks after the date on which it is given a notice under section 17O(6) above, direct the Authority—

(a)not to make the modifications set out in that notice; or

(b)not to make such of the modifications as may be specified in the direction;

and the Authority shall comply with any such direction.

(2)The Secretary of State may—

(a)within the period of four weeks after the date on which the [F193CMA] is given a notice under section 17O(6) above; and

(b)on the application of the [F193CMA] ,

direct that the period for giving a direction under subsection (1) above (and, accordingly, the period mentioned in section 17O(8) above) shall be extended by fourteen days.

(3)The power to give a direction under subsection (1) above may only be exercised in respect of such of the modifications set out in the notice under section 17O(6)(a) above as appear to the [F193CMA] not to be the modifications which are requisite for the purpose of remedying or preventing all or any of the adverse effects specified in the report as effects which could be remedied or prevented by modifications.

(4)If the [F193CMA] gives a direction under subsection (1) above, it shall—

(a)give notice setting out the modifications proposed by the Authority, the terms of the direction and the reasons for giving it; and

(b)make such modifications itself of the relevant conditions as appear to it to be requisite for the purpose of remedying or preventing—

(i)if the direction was given under subsection (1)(a) above, the adverse effects specified in the report as effects which could be remedied or prevented by modifications;

(ii)if the direction was given under subsection (1)(b) above, such of those adverse effects as are not remedied or prevented by the modifications made by the Authority under section 17O(8)(b) above.

(5)In exercising its power under subsection (4)(b) above the [F193CMA] shall have regard to the matters as respects which duties are imposed on the Authority by Part 1 of this Act.

(6)Before making modifications under subsection (4)(b) above the [F193CMA] shall give notice—

(a)stating that it proposes to make the modifications and setting them out;

(b)stating the reason why it proposes to make them;

(c)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(7)A notice under subsection (4)(a) or (6) above shall be given—

(a)by publishing the notice in such manner as the [F193CMA] considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications;

(b)by serving a copy of the notice on—

(i)the Authority;

(ii)the holder of the licence in question or, as the case may be, the relevant licence holders;

(iii)the Council;

(iv)the Secretary of State;

(v)the Assembly; and

(vi)the Chief Inspector of Drinking Water.

(8)After making modifications under this section the [F193CMA] shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.

(9)The modification under this section of part of a standard condition of a particular licence in consequence of a reference under section 17K(1) above shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Chapter.

(10)Where, in consequence of a reference under section 17K(2) above, the [F194CMA] modifies under subsection (4)(b) above the standard conditions of retail licences or combined licences, the Authority may make such incidental or consequential modifications as it considers necessary or expedient of any conditions of licences of that description.

(11)Where, in consequence of a reference under section 17K(2) above, the [F194CMA] modifies under subsection (4)(b) above the standard conditions of retail licences or combined licences, the Authority shall—

(a)make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that description granted after that time, and

(b)publish the modifications made for those purposes in such manner as it considers appropriate.

17QSection 17P: supplementaryU.K.

(1)For the purposes of the law relating to defamation, absolute privilege attaches to any notice under subsection (4)(a), (6) or (8) of section 17P above.

(2)In giving any notice under subsection (4)(a) or (6) of section 17P above, or publishing any notice under subsection (8) of that section, the [F195CMA] must have regard to the following considerations before disclosing any information.

(3)The first consideration is the need to exclude from disclosure (so far as practicable) any information whose disclosure the [F195CMA] thinks is contrary to the public interest.

(4)The second consideration is the need to exclude from disclosure (so far as practicable)—

(a)commercial information whose disclosure the [F195CMA] thinks might significantly harm the legitimate business interests of the undertaking to which it relates; or

(b)information relating to the private affairs of an individual whose disclosure the [F195CMA] thinks might significantly harm the individual’s interests.

(5)The third consideration is the extent to which the disclosure of the information mentioned in subsection (4)(a) or (b) above is necessary for the purposes of the notice.

(6)The following sections of Part 3 of the Enterprise Act 2002 shall apply, with the modifications mentioned in subsections [F196(6A),] (7) and (8) below, for the purposes of any investigation by the [F197CMA] for the purposes of the exercise of its functions under section 17P above, as they apply for the purposes of any investigation on references under that Part—

(a)section 109 (attendance of witnesses and production of documents etc);

(b)section 110 (enforcement of powers under section 109: general);

(c)section 111 (penalties);

(d)section 112 (penalties: main procedural requirements);

(e)section 113 (payments and interest by instalments);

(f)section 114 (appeals in relation to penalties);

(g)section 115 (recovery of penalties); and

(h)section 116 (statement of policy).

[F198(6A)Section 109 shall, in its application by virtue of subsection (6) above, have effect as if—

(a)for subsection (A1), there were substituted—

(A1)For the purposes of this section, a permitted purpose is assisting the CMA in carrying out any functions exercisable by it in connection with an investigation for the purposes of the exercise of its functions under section 17P of the Water Industry Act 1991., and

(b)subsection (8A) were omitted.]

(7)Section 110 shall, in its application by virtue of subsection (6) above, have effect as if—

(a)subsection (2) were omitted,

[F199(b)after subsection (3), there were inserted—

(3A)No penalty shall be imposed by virtue of subsection (1) or (3) if more than 4 weeks have passed since the publication by the CMA of a notice under section 17P(9) of the Water Industry Act 1991 in connection with the reference concerned or, if no direction has been given by the CMA under section 17P(1) of that Act in connection with the reference concerned and within the period permitted for that purpose, the latest day on which it was possible to give such a direction within the permitted period; but this subsection shall not apply in relation to any variation or substitution of the penalty which is permitted by virtue of this Part.; and]

(c)in subsection (9) the words from “or section” to “section 65(3))” were omitted.

(8)Section 111(5)(b) shall, in its application by virtue of subsection (6), have effect as if for sub-paragraph (ii) there were substituted—

(ii)if earlier, the day on which a notice is published by the [F200CMA] under section 17P(8) of the Water Industry Act 1991 in connection with the reference concerned or, if no direction is given by the [F200CMA] under section 17P(1) of that Act in connection with the reference concerned and within the period permitted for that purpose, the latest day on which such a direction may be given within the permitted period.

(9)Provisions of Part 3 of the Enterprise Act 2002 which have effect for the purposes of sections 109 to 116 of that Act (including, in particular, provisions relating to offences and the making of orders) shall, for the purposes of the application of those sections by virtue of subsection (6) above, have effect in relation to those sections as applied by virtue of that subsection.

(10)Accordingly, corresponding provisions of this Act shall not have effect in relation to those sections as applied by virtue of that subsection.

Textual Amendments

Modifications etc. (not altering text)

17RWater supply licences: modification by order under other enactmentsU.K.

(1)Where the [F201CMA] or the Secretary of State (the “relevant authority”) makes a relevant order, the order may also provide for the modification of—

(a)the conditions of a particular retail licence or combined licence; or

(b)the standard conditions of retail licences or combined licences,

to such extent as may appear to the relevant authority to be requisite or expedient for the purpose of giving effect to, or taking account of, any provision made by the order.

(2)In subsection (1) above “relevant order” means—

(a)an order under section 75, 83 or 84 of, or paragraph 5, 10 or 11 of Schedule 7 to, the Enterprise Act 2002 where—

(i)one or more than one of the enterprises which have, or may have, ceased to be distinct enterprises was engaged in the carrying on of activities authorised or regulated by a retail licence or combined licence; or

(ii)one or more than one of the enterprises which will or may cease to be distinct enterprises is engaged in the carrying on of activities authorised or regulated by a retail licence or combined licence; or

(b)an order under section 160 or 161 of that Act where the feature, or combination of features, of the market [F202or markets] in the United Kingdom for goods or services which prevents, restricts or distorts competition relates to activities authorised or regulated by a retail licence or combined licence.

(3)The modification under subsection (1)(a) above of part of a standard condition of a particular licence shall not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of this Chapter.

(4)Where at any time the relevant authority modifies under subsection (1)(b) above the standard conditions of retail licences or combined licences, the relevant authority—

(a)shall also make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences of that description granted after that time; and

(b)may, after consultation with the Authority, make such incidental or consequential modifications as the relevant authority considers necessary or expedient of any conditions of licences of that description granted before that time.

(5)Where at any time the relevant authority modifies standard conditions of retail licences or combined licences under subsection (4)(a) above for the purposes of their incorporation in licences, the relevant authority shall publish those modifications in such manner as the relevant authority considers appropriate.

(6)Expressions used in subsection (2) above and in Part 3 or 4 of the Enterprise Act 2002 have the same meaning in that subsection as in that Part.]

CHAPTER IIE+W ENFORCEMENT OF INSOLVENCY

Enforcement ordersE+W

18 Orders for securing compliance with certain provisions.E+W

(1)Subject to subsection (2) and sections 19 and 20 below, where in the case of any company holding an appointment under Chapter I of this Part [F203or a licence under Chapter 1A of this Part] the Secretary of State or the Director is satisfied—

(a)that that company is contravening—

(i)any condition of the company’s appointment [F204or licence] in relation to which he is the enforcement authority; or

(ii)any statutory or other requirement which is enforceable under this section and in relation to which he is the enforcement authority;

or

(b)that that company [F205is likely to contravene any such condition or requirement] ,

he shall by a final enforcement order make such provision as is requisite for the purpose of securing compliance with that condition or requirement.

[F206(1A)Subject to subsection (2) and sections 19 and 20 below, where—

(a)in the case of any company holding an appointment under Chapter 1 of this Part, the Secretary of State or the Authority is satisfied that the company—

(i)is causing or contributing to a contravention of a condition or requirement such as is referred to in paragraph (a)(i) or (ii) of subsection (1) above by a company holding a licence under Chapter 1A of this Part; or

(ii)is likely to cause or contribute to any such contravention; or

(b)in the case of any company holding a licence under Chapter 1A of this Part, the Secretary of State or the Authority is satisfied that the company—

(i)is causing or contributing to a contravention of a condition or requirement such as is referred to in paragraph (a)(i) or (ii) of subsection (1) above by a company holding an appointment under Chapter 1 of this Part; or

(ii)is likely to cause or contribute to any such contravention,

he or it shall by a final enforcement order make such provision as is requisite for the purpose of securing compliance with that condition or requirement.]

(2)Subject to section 19 below, where in the case of any company holding an appointment under Chapter I of this Part [F207or a licence under Chapter 1A of this Part]

(a)it appears to the Secretary of State or the Director as mentioned in paragraph (a) or (b) of subsection (1) [F208or (1A)] above; and

(b)it appears to him that it is requisite that a provisional enforcement order be made,

he may (instead of taking steps towards the making of a final order) by a provisional enforcement order make such provision as appears to him requisite for the purpose of securing compliance with the condition or requirement in question.

(3)In determining for the purposes of subsection (2)(b) above whether it is requisite that a provisional enforcement order be made, the Secretary of State or, as the case may be, the Director shall have regard, in particular, to the extent to which any person is likely to sustain loss or damage in consequence of anything which, in contravention of any condition or of any statutory or other requirement enforceable under this section, is likely to be done, or omitted to be done, before a final enforcement order may be made.

(4)Subject to sections 19 and 20 below, where the Secretary of State or the Director has made a provisional enforcement order, he shall confirm it, with or without modifications, if—

(a)he is satisfied that the company to which the order relates—

(i)is contravening any condition or statutory or other requirement in relation to which he is the enforcement authority; or

[F209(ii)is likely to contravene any such condition or requirement;][F210or

(iii)is causing or contributing to a contravention of any such condition or requirement; or

(iv)is likely to cause or contribute to any such contravention;]

and

(b)the provision made by the order (with any modifications) is requisite for the purpose of securing compliance with that condition or requirement.

(5)An enforcement order—

(a)shall require the company to which it relates (according to the circumstances of the case) to do, or not to do, such things as are specified in the order or are of a description so specified;

(b)shall take effect at such time, being the earliest practicable time, as is determined by or under the order; and

(c)may be revoked at any time by the enforcement authority who made it.

(6)For the purposes of this section and the following provisions of this Act—

(a)the statutory and other requirements which shall be enforceable under this section in relation to a company holding an appointment under Chapter I of this Part [F211or a licence under Chapter 1A of this Part] shall be such of the requirements of any enactment or of any subordinate legislation as—

(i)are imposed in consequence of that appointment [F212or licence] ; and

(ii)are made so enforceable by that enactment or subordinate legislation;

(b)the Director shall be the enforcement authority in relation to the conditions of an appointment under Chapter I of this Part [F213or of a licence under Chapter 1A of this Part] ; and

(c)the enforcement authority in relation to each of the statutory and other requirements enforceable under this section shall be the Secretary of State, the Director or either of them, according to whatever provision is made by the enactment or subordinate legislation by which the requirement is made so enforceable.

(7)In this section and the following provisions of this Chapter—

  • enforcement order” means a final enforcement order or a provisional enforcement order;

  • final enforcement order” means an order under this section other than a provisional enforcement order;

  • provisional enforcement order” means an order under this section which, if not previously confirmed in accordance with subsection (4) above, will cease to have effect at the end of such period (not exceeding three months) as is determined by or under the order.

[F214(8)Where any act or omission—

(a)constitutes a contravention of a condition of an appointment under Chapter 1 of this Part or of a condition of a licence under Chapter 1A of this Part or of a statutory or other requirement enforceable under this section; or

(b)causes or contributes to a contravention of any such condition or requirement,

the only remedies for, or for causing or contributing to, that contravention (apart from those available by virtue of this section) shall be those for which express provision is made by or under any enactment and those that are available in respect of that act or omission otherwise than by virtue of its constituting, or causing or contributing to, such a contravention.]

Textual Amendments

F205Words in s. 18(1)(b) substituted (1.10.2004) by Water Act 2003 (c. 37), ss. 49(2)(a), 105(3); S.I. 2004/2528, art. 2(f) (with art. 4, Sch.)

F209S. 18(4)(a)(ii) substituted (1.10.2004) by Water Act 2003 (c. 37), ss. 49(2)(b), 105(3); S.I. 2004/2528, art. 2(f) (with savings in art. 4)

F210S. 18(4)(iii)(iv) and preceding word inserted (1.12.2005) by Water Act 2003 (c. 37), ss. 101(1), 105(3), Sch. 8 para. 4(5); S.I. 2005/2714, art. 3(c) (with Sch. 2 para. 8)

Modifications etc. (not altering text)

C27S. 18 extended (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 20(3), 225(2).

C28S. 18 extended (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 197(6), 225(2).

C29S. 18 extended (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 203(5), 225(2).

C30S. 18: power to extend conferred (01.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 219(2)(a), 225(2).

19 Exceptions to duty to enforce.E+W

(1)[F215Subject to the Drinking Water (Undertakings) (England and Wales) Regulations 2000]Neither the Secretary of State nor the Director shall be required to make an enforcement order in relation to any company, or to confirm a provisional enforcement order so made, if he is satisfied—

(a)that the contraventions were, or the apprehended contraventions are, of a trivial nature;

[F216(aa)that the extent to which the company caused or contributed to, or was likely to cause or contribute to, a contravention was trivial;]

(b)that the company has given, and is complying with, an undertaking to take all such steps as it appears to him for the time being to be appropriate for the company to take for the purpose of securing or facilitating compliance with the condition or requirement in question; or

(c)that the duties imposed on him by Part I of this Act preclude the making or, as the case may be, the confirmation of the order.

[F217(1A)Before making an enforcement order or confirming a provisional enforcement order, the Authority shall consider whether it would be more appropriate to proceed under the Competition Act 1998.

(1B)The Authority shall not make an enforcement order or confirm a provisional enforcement order if it considers that it would be more appropriate to proceed under the Competition Act 1998.]

(2)The requirement to comply with an undertaking given for the purposes of subsection (1)(b) above shall be treated as a statutory requirement enforceable under section 18 above—

(a)by the Secretary of State; or

(b)with the consent of or in accordance with a general authorisation given by the Secretary of State, by the Director.

(3)Where the Secretary of State or the Director, having notified a company that he is considering the making in relation to the company of an enforcement order or the confirmation of a provisional enforcement order so made, is satisfied as mentioned in paragraph (a), [F218(aa),](b) or (c) of subsection (1) above [F219or, in the case of the Director, [F220has decided that it would be more appropriate to proceed under the Competition Act 1998] ,] he shall—

(a)serve notice that he is so satisfied [F221or has so decided] on the company;

[F222(b)publish in such manner as the Secretary of State or the Authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them—

(i)a copy of the notice, and

(ii)where the Secretary of State or the Authority is satisfied as mentioned in paragraph (b) of subsection (1), a summary of the undertaking describing the steps to be taken under it; and]

(c)in a case where the Secretary of State is satisfied as mentioned in the said paragraph (b), serve a copy of the notice and of the undertaking given for the purposes of that paragraph on the Director.

[F223(3A)In a case where notice under subsection (3)(a) falls to be served by the Welsh Ministers, references to the Secretary of State in subsection (3)(b) are to be read as references to the Welsh Ministers.]

(4)The requirements of subsection (3) above shall not apply, in the case of any proposed order or confirmation in respect of a direction under section 208 below, to the extent that the Secretary of State directs that they should not be complied with in the interests of national security.

Textual Amendments

F215Words in s. 19(1) inserted (14.6.2000) by S.I. 2000/1297, art. 8

F219Words in s. 19(3) inserted (1.3.2000) by 1998 c. 41, s. 54(3), Sch. 10 Pt. IV para. 13(7) (with s. 73); S.I. 2000/344, art. 2 Sch.

Modifications etc. (not altering text)

C37S. 19(1)(b) restricted (14.6.2000) by S.I. 2000/1297, art. 2

C38S. 19(4): functions exercisable by the Assembly concurrently with the Ministers of the Crown (W.) (1.7.1999) by S.I. 1999/672, art. 2, Sch. 1

20 Procedure for enforcement orders.d1>E+W

(1)Before making a final enforcement order [F224under section 18(1) above] or confirming a provisional enforcement order [F225in a case in which section 18(4)(a)(i) or (ii) above applies] , the Secretary of State or the Director shall give notice—

(a)stating that he proposes to make or confirm the order and setting out the effect of the order;

(b)setting out—

(i)the condition or requirement for the purpose of securing compliance with which the order is to be made or confirmed;

(ii)the acts or omissions which, in his opinion, constitute or would constitute contraventions of that condition or requirement; and

(iii)the other facts which, in his opinion, justify the making or confirmation of the order;

and

(c)specifying the period (not being less than [F226twenty-one] days from the date of publication of the notice) within which representations or objections with respect to the proposed order or proposed confirmation may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

[F227(1A)Before making a final enforcement order under section 18(1A) above or confirming a provisional enforcement order in a case in which section 18(4)(a)(iii) or (iv) above applies, the Secretary of State or the Authority shall give notice—

(a)stating that he or it proposes to make or confirm the order and setting out the effect of the order;

(b)setting out—

(i)the condition or requirement for the purposes of securing compliance with which the order is to be made or confirmed;

(ii)the acts or omissions which, in his or its opinion, cause or contribute to or would cause or contribute to the contravention of that condition or requirement; and

(iii)the other facts which, in his or its opinion, justify the making or confirmation of the order; and

(c)specifying the period (not being less than twenty-one days from the date of publication of the notice) within which representations or objections to the proposed order or proposed confirmation may be made,

and shall consider any representations or objections which are duly made and not withdrawn.]

(2)A notice under subsection (1) [F228or (1A)] above shall be given—

(a)by publishing the notice in such manner as the Secretary of State or, as the case may be, the Director considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them; and

(b)by serving a copy of the notice, and a copy of the proposed order or of the order proposed to be confirmed, on the company to which the order relates and, where the notice is given by the Secretary of State, on the Director.

(3)Neither the Secretary of State nor the Director shall make a final enforcement order with modifications, or confirm a provisional enforcement order with modifications, except—

(a)with the consent to the modifications of the company to which the order relates; or

(b)after complying with the requirements of subsection (4) below.

(4)The requirements mentioned in subsection (3) above are that the Secretary of State or, as the case may be, the Director shall—

(a)serve on the company to which the order relates such notice as appears to him to be requisite of his proposal to make or confirm the order with modifications;

(b)in that notice specify the period (not being less than [F229twenty-one] days from the date of the service of the notice) within which representations or objections with respect to the proposed modifications may be made; and

(c)consider any representations or objections which are duly made and not withdrawn.

(5)As soon as practicable after making an enforcement order or confirming a provisional enforcement order, the Secretary of State or, as the case may be, the Director shall—

(a)serve a copy of the order on the company to which the order relates and, where this subsection applies in the case of an order made or confirmed by Secretary of State, on the Director; and

(b)publish such a copy in such manner as he considers appropriate for the purpose of bringing the order to the attention of persons likely to be affected by it.

(6)Before revoking an enforcement order, other than an unconfirmed provisional order, the Secretary of State or the Director shall give notice—

(a)stating that he proposes to revoke the order and setting out its effect; and

(b)specifying the period (not being less than twenty-eight days from the date of publication of the notice) within which representations or objections with respect to the proposed revocation may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(7)If, after giving a notice under subsection (6) above, the Secretary of State or the Director decides not to revoke the order to which the notice relates, he shall give notice of that decision.

(8)A notice under subsection (6) or (7) above shall be given—

(a)by publishing the notice in such manner as the Secretary of State or, as the case may be, the Director considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them; and

(b)by serving a copy of the notice on the company to which the order relates and, where the notice is given by the Secretary of State, on the Director.

(9)The requirements of the preceding provisions of this section shall not apply, in the case of any order in respect of a contravention of a direction under section 208 below, to the extent that the Secretary of State directs that they should not be complied with in the interests of national security.

Textual Amendments

F226Words in s. 20(1)(c) substituted (1.10.2004) by Water Act 2003 (c. 37), ss. 49(3)(4), 105(3); S.I. 2004/2528, art. 2(f)

F229Words in s. 20(4)(b) substituted (1.10.2004) by Water Act 2003 (c. 37), ss. 49(3)(4), 105(3); S.I. 2004/2528, art. 2(f)

Modifications etc. (not altering text)

C40S. 20(9): functions exercisable by the Assembly concurrently with the Ministers of the Crown (W.) (1.7.1999) by S.I. 1999/672, art. 2, Sch. 1

21 Validity of enforcement orders.E+W

(1)If the company to which an enforcement order relates is aggrieved by the order and desires to question its validity on the ground—

(a)that its making or confirmation was not within the powers of section 18 above; or

(b)that any of the requirements of section 20 above have not been complied with in relation to it,

the company may, within forty-two days from the date of service on it of a copy of the order, make an application to the High Court under this section.

(2)On any such application the High Court may, if satisfied that the making or confirmation of the order was not within those powers or that the interests of the company have been substantially prejudiced by a failure to comply with those requirements, quash the order or any provision of the order.

(3)Except as provided by this section, the validity of an enforcement order shall not be questioned in any legal proceedings whatsoever.

22 Effect of enforcement order.E+W

(1)The obligation to comply with an enforcement order shall be a duty owed to any person who may be affected by a contravention of the order.

(2)Where a duty is owed by virtue of subsection (1) above to any person, any breach of the duty which causes that person to sustain loss or damage shall be actionable at the suit of that person.

(3)In any proceedings brought against any company in pursuance of subsection (2) above, other than proceedings in respect of so much of a contravention of any order as consists in a breach of the duty imposed by virtue of section 68(1)(a) [F230or (1A)(a)] below, it shall be a defence for the company to show that it took all reasonable steps and exercised all due diligence to avoid contravening the order.

(4)Without prejudice to any right which any person may have by virtue of subsection (1) above to bring civil proceedings in respect of any contravention or apprehended contravention of an enforcement order, compliance with any such order shall be enforceable by civil proceedings by the relevant enforcement authority for an injunction or for any other appropriate relief.

(5)In subsection (4) above “the relevant enforcement authority”, in relation to any enforcement order, means the Secretary of State or the Director or either of them according to who is the enforcement authority in relation to the condition or requirement compliance with which was to be secured by the order.

[F231Financial penaltiesE+W

Textual Amendments

F231Ss. 22A-22F and preceding cross-heading inserted (1.10.2004 for specified purposes and otherwise 1.4.2005) by Water Act 2003 (c. 37), ss. 48(1), 105(3); S.I. 2004/2528, art. 2(e) (with savings in art. 4); S.I. 2005/968, art. 2(i) (with savings in art. 4, Sch. 1, 2)

22APenaltiesE+W

(1)Where the Authority is satisfied—

(a)in the case of any company holding an appointment under Chapter 1 of this Part, that the company—

(i)has contravened or is contravening any condition of the appointment;

(ii)has caused or contributed to, or is causing or contributing to, a contravention by a company holding a licence under Chapter 1A of this Part of any condition of the licence; or

(iii)has failed or is failing to achieve any standard of performance prescribed under section 38(2) or 95(2) below; or

(b)in the case of any company holding a licence under Chapter 1A of this Part, that the company—

(i)has contravened or is contravening any condition of the licence; or

(ii)has caused or contributed to, or is causing or contributing to, a contravention by a company holding an appointment under Chapter 1 of this Part of any condition of the appointment,

the Authority may, subject to section 22C below, impose on the company a penalty of such amount as is reasonable in all the circumstances of the case.

(2)Where the Authority, the Secretary of State or the Assembly is satisfied—

(a)in the case of any company holding an appointment under Chapter 1 of this Part, that the company—

(i)has contravened or is contravening any statutory or other requirement which is enforceable under section 18 above and in relation to which he or it is the enforcement authority; or

(ii)has caused or contributed to, or is causing or contributing to, a contravention by a company holding a licence under Chapter 1A of this Part of any such requirement; or

(b)in the case of any company holding a licence under Chapter 1A of this Part, that the company—

(i)has contravened or is contravening any statutory or other requirement which is enforceable under section 18 above and in relation to which he or it is the enforcement authority; or

(ii)has caused or contributed to, or is causing or contributing to, a contravention by a company holding an appointment under Chapter 1 of this Part of any such requirement,

he or it may, subject to section 22C below, impose on the company a penalty of such amount as is reasonable in all the circumstances of the case.

(3)In a case in which—

(a)subsection (1) above applies by virtue of paragraph (a)(ii) or (b)(ii) of that subsection, or

(b)subsection (2) above applies by virtue of paragraph (a)(ii) or (b)(ii) of that subsection,

references in the following provisions of this section and sections 22B and 22C below to a contravention include references to causing or contributing to a contravention.

(4)Before imposing a penalty on a company under subsection (1) or (2) above the Authority, the Secretary of State or the Assembly (the “enforcement authority”) shall give notice—

(a)stating that it proposes to impose a penalty and the amount of the penalty proposed to be imposed;

(b)setting out the condition, requirement or standard of performance in question;

(c)specifying the acts or omissions which, in the opinion of the enforcement authority, constitute the contravention or failure in question and the other facts which, in the opinion of the enforcement authority, justify the imposition of a penalty and the amount of the penalty proposed; and

(d)specifying the period (not being less than twenty-one days from the date of publication of the notice) within which representations or objections with respect to the proposed penalty may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(5)Before varying any proposal stated in a notice under subsection (4)(a) above the enforcement authority shall give notice—

(a)setting out the proposed variation and the reasons for it; and

(b)specifying the period (not being less than twenty-one days from the date of publication of the notice) within which representations or objections with respect to the proposed variation may be made,

and shall consider any representations or objections which are duly made and not withdrawn.

(6)As soon as practicable after imposing a penalty, the enforcement authority shall give notice—

(a)stating that he or it has imposed a penalty on the company and its amount;

(b)setting out the condition, requirement or standard of performance in question;

(c)specifying the acts or omissions which, in the opinion of the enforcement authority, constitute the contravention or failure in question and the other facts which, in the opinion of the enforcement authority, justify the imposition of the penalty and its amount; and

(d)specifying a date, no earlier than the end of the period of forty-two days from the date of service of the notice on the company, by which the penalty is required to be paid.

(7)The company may, within twenty-one days of the date of service on it of a notice under subsection (6) above, make an application to the enforcement authority for him or it to specify different dates by which different portions of the penalty are to be paid.

(8)Any notice required to be given under this section shall be given—

(a)by publishing the notice in such manner as the enforcement authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them;

(b)by serving a copy of the notice on the company;

(c)by serving a copy of the notice on the Council; and

(d)where the notice is given by the Secretary of State or the Assembly, by serving a copy of the notice on the Authority.

(9)Any sums received by the enforcement authority by way of penalty under this section shall be paid into the Consolidated Fund.

(10)The power of the enforcement authority to impose a penalty under this section is not exercisable in respect of any contravention or failure before the commencement of this section.

(11)No penalty imposed by an enforcement authority under this section may exceed 10% of the turnover of the company (determined in accordance with provisions specified in an order made, after consulting the Assembly, by the Secretary of State).

(12)The power of the Secretary of State to make an order under subsection (11) above shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

[F232(13)Before imposing a penalty under this section, the Authority shall consider whether it would be more appropriate to proceed under the Competition Act 1998.

(14)The Authority shall not impose a penalty under this section if it considers that it would be more appropriate to proceed under the Competition Act 1998.]

22BStatement of policy with respect to penaltiesE+W

(1)Each enforcement authority shall prepare and publish a statement of policy with respect to the imposition of penalties and the determination of their amount.

(2)In deciding whether to impose a penalty, and in determining the amount of any penalty, in respect of a contravention or failure an enforcement authority shall have regard to his or its statement of policy most recently published at the time when the contravention or failure occurred.

(3)An enforcement authority may revise his or its statement of policy and where he or it does so shall publish the revised statement.

(4)Publication under this section shall be in such manner as the enforcement authority considers appropriate for the purpose of bringing the matters contained in the statement of policy to the attention of persons likely to be affected by them.

(5)An enforcement authority shall undertake such consultation as he or it considers appropriate when preparing or revising his or its statement of policy.

22CTime limits on the imposition of financial penaltiesE+W

(1)Where no final or provisional order has been made in relation to a contravention or failure, an enforcement authority may not impose a penalty in respect of the contravention or failure later than the end of the period of [F233five years] from the time of the contravention or failure, unless before the end of that period—

(a)the notice under section 22A(4) above relating to the penalty is served on the company under section 22A(8) above; or

(b)a notice relating to the contravention or failure is served on the company under section 203(2) below.

(2)Where a final or provisional order has been made in relation to a contravention or failure, an enforcement authority may not impose a penalty in respect of the contravention or failure unless the notice relating to the penalty under section 22A(4) above was served on the company under section 22A(8) above—

(a)within three months from the confirmation of the provisional order or the making of the final order; or

(b)where the provisional order is not confirmed, within six months from the making of the provisional order.

Textual Amendments

F233Words in s. 22C(1) substituted (14.7.2014) by Water Act 2014 (c. 21), ss. 26(1), 94(2)(g) (with s. 26(2))

Modifications etc. (not altering text)

22DInterest and payment of instalmentsE+W

(1)If the whole or any part of a penalty is not paid by the date by which it is required to be paid, the unpaid balance from time to time shall carry interest at the rate for the time being specified in section 17 of the Judgments Act 1838.

(2)If an application is made under subsection (7) of section 22A above in relation to a penalty, the penalty is not required to be paid until the application has been determined.

(3)If the enforcement authority grants an application under that subsection in relation to a penalty but any portion of the penalty is not paid by the date specified in relation to it by the enforcement authority under that subsection, the enforcement authority may where he or it considers it appropriate require so much of the penalty as has not already been paid to be paid immediately.

22EAppealsE+W

(1)If the company on which a penalty is imposed is aggrieved by—

(a)the imposition of the penalty;

(b)the amount of the penalty; or

(c)the date by which the penalty is required to be paid, or the different dates by which different portions of the penalty are required to be paid,

the company may make an application to the court under this section.

(2)An application under subsection (1) above must be made—

(a)within forty-two days from the date of service on the company of a notice under section 22A(6) above; or

(b)where the application relates to a decision of an enforcement authority on an application by the company under section 22A(7) above, within forty-two days from the date the company is notified of the decision.

(3)On any such application, where the court considers it appropriate to do so in all the circumstances of the case and is satisfied of one or more of the grounds falling within subsection (4) below, the court—

(a)may quash the penalty;

(b)may substitute a penalty of such lesser amount as the court considers appropriate in all the circumstances of the case; or

(c)in the case of an application under subsection (1)(c) above, may substitute for the date or dates imposed by the enforcement authority an alternative date or dates.

(4)The grounds falling within this subsection are—

(a)that the imposition of the penalty was not within the power of the enforcement authority under section 22A above;

(b)that any of the requirements of subsections (4) to (6) or (8) of section 22A above have not been complied with in relation to the imposition of the penalty and the interests of the company have been substantially prejudiced by the non-compliance; or

(c)that it was unreasonable of the enforcement authority to require the penalty imposed, or any portion of it, to be paid by the date or dates by which it was required to be paid.

(5)If an application is made under this section in relation to a penalty, the penalty is not required to be paid until the application has been determined.

(6)Where the court substitutes a penalty of a lesser amount it may require the payment of interest on the substituted penalty at such rate, and from such date, as it considers just and equitable.

(7)Where the court specifies as a date by which the penalty, or a portion of the penalty, is to be paid a date before the determination of the application under this section it may require the payment of interest on the penalty, or portion, from that date at such rate as it considers just and equitable.

(8)Except as provided by this section, the validity of a penalty shall not be questioned by any legal proceedings whatever.

(9)In this section “the court” means the High Court.

22FRecovery of penaltiesE+W

Where a penalty imposed under section 22A(1) or (2) above, or any portion of it, has not been paid by the date on which it is required to be paid and—

(a)no application relating to the penalty has been made under section 22E above during the period within which such an application can be made; or

(b)an application has been made under that section and determined,

the enforcement authority may recover from the company, as a civil debt due to him or it, any of the penalty and any interest which has not been paid.]

Special administration ordersE+W

23 Meaning and effect of special administration order.E+W

(1)A special administration order is an order of the High Court made in accordance with section 24 or 25 below in relation to a company holding an appointment under Chapter I of this Part [F234or which is a qualifying licensed water supplier] and directing that, during the period for which the order is in force, the affairs, business and property of the company shall be managed, by a person appointed by the High Court—

(a)for the achievement of the purposes of such an order; and

(b)in a manner which protects the respective interests of the members and creditors of the company.

(2)The purposes of a special administration order made in relation to any company [F235holding an appointment under Chapter 1 of this Part] shall be-

(a)the transfer to another company, or (as respects different parts of the area to which the company’s appointment relates, or different parts of its undertaking) to two or more different companies, as a going concern, of so much of the company’s undertaking as it is necessary to transfer in order to ensure that the functions which have been vested in the company by virtue of its appointment may be properly carried out; and

(b)the carrying out of those functions pending the making of the transfer and the vesting of those functions in the other company or companies (whether by virtue of the transfer or of an appointment or variation which replaces the former company as a relevant undertaker).

[F236(2A)The purposes of a special administration order made in relation to any company which is a qualifying licensed water supplier shall be—

(a)the transfer to another company or companies, as a going concern, of so much of the company’s undertaking as it is necessary to transfer in order to ensure that activities relating to the introduction or introductions of water mentioned in subsection (6)(b) below may be properly carried on; and

(b)the carrying on of those activities pending the making of the transfer.]

[F237(2B)Where a company is in special administration as a result of an order made on the grounds that the company is or is likely to be unable to pay its debts—

(a)a purpose of the special administration order is to rescue the company as a going concern, and

(b)the transfer purpose under subsection (2)(a) or (2A)(a) applies only if the special administrator thinks that—

(i)it is not likely to be possible to rescue the company as a going concern, or

(ii)transfer is likely to secure more effective performance of the functions or activities mentioned in subsection (2)(a) or (2A)(a).

(2C)Where subsection (2B) applies, subsections (2)(b) and (2A)(b) have effect as if they referred to carrying out functions, or carrying on activities, pending rescue or transfer.

(2D)For the purpose of rescuing the company as a going concern a special administrator may propose—

(a)a company voluntary arrangement under Part 1 of the Insolvency Act 1986, or

(b)a compromise or arrangement in accordance with Part 26 of the Companies Act 2006.

(2E)The Secretary of State may by regulations made by statutory instrument—

(a)modify a provision of the Insolvency Act 1986 or the Companies Act 2006 in respect of the arrangements and compromises mentioned in subsection (2D) in so far as they apply to a company which is or has been in special administration;

(b)make other supplemental provision about those arrangements and compromises (which may, in particular, apply or modify the effect of an enactment about insolvency or companies).

(2F)Provision under subsection (2E)(a) or (b) may, in particular, confer a function on—

(a)the Secretary of State,

(b)the Welsh Ministers, or

(c)the Authority.

(2G)Regulations under subsection (2E) may not be made unless—

(a)the Welsh Ministers have consented to the making of the regulations, and

(b)a draft has been laid before and approved by resolution of each House of Parliament (and section 213(1) shall not apply).]

[F238(2H)A transfer under subsection (2) or (2A) may be effected by—

(a)transferring all or part of the company's undertaking to a wholly-owned subsidiary of the company, and

(b)then transferring securities in the subsidiary to another company.]

[F239(3)Schedule 3 to this Act shall have effect for applying provisions of the Insolvency Act 1986 where a special administration order is made.]

[F239(3)Schedule B1 to the Insolvency Act 1986 (administration) applies to special administration (subject to regulations under subsection (3A)).

(3A)The Secretary of State may make regulations about special administration which—

(a)apply (with or without modification) an insolvency provision;

(b)disapply an insolvency provision;

(c)modify the effect of an insolvency provision;

(d)make provision similar to, and in place of, an insolvency provision.

(3B)In subsection (3A) “insolvency provision” means a provision of the Insolvency Act 1986 or another enactment about insolvency (including (i) a provision about administration, (ii) a provision about consequences of insolvency, and (iii) a provision conferring power to make rules).

(3C)A reference in an enactment to Part II of the Insolvency Act 1986 includes a reference to that Part as applied by or under this section (subject to regulations under subsection (3A)).

(3D)Regulations under subsection (3A) shall be made by statutory instrument and may not be made unless—

(a)the Welsh Ministers have consented to the making of the regulations, and

(b)a draft has been laid before and approved by resolution of each House of Parliament (and section 213(1) shall not apply).]

(4)Schedule 2 to this Act shall have effect for enabling provision to be made with respect to cases in which

[F240(a)a company is replaced by another as a relevant undertaker without an appointment or variation under Chapter 1 of this Part; or

(b)a company carries on activities relating to the introduction or introductions of water mentioned in subsection (6)(b) below formerly carried on by another company,

in pursuance of a special administration order.]

(5)In this section “business” and “property” have the same meanings as in the M6Insolvency Act 1986.

[F241(6)For the purposes of this section, sections 24 to 26 below and Schedule 2 to this Act, a licensed water supplier is a qualifying licensed water supplier if—

(a)it is the holder of a combined licence (within the meaning of Chapter 1A of this Part); and

(b)the introduction of water by it which is permitted under section 66B or 66C below is designated as a strategic supply under section 66G below or the introductions of water by it which are so permitted are designated as a collective strategic supply under section 66H below.]

Textual Amendments

F237S. 23(2B)-(2G) inserted (1.10.2010 for specified purposes) by Flood and Water Management Act 2010 (c. 29), s. 49(3), Sch. 5 para. 3 (with s. 49(1)(6)); S.I. 2010/2169, art. 4, Sch.

F239S. 23(3)-(3D) substituted for s. 23(3) (1.10.2010 for specified purposes) by Flood and Water Management Act 2010 (c. 29), s. 49(3), Sch. 5 para. 6(1) (with s. 49(1)(6)); S.I. 2010/2169, art. 4, Sch.

F240Words in s. 23(4) substituted (1.12.2005) by Water Act 2003 (c. 37), ss. 101(1), 105(3), Sch. 8 para. 8(5); S.I. 2005/2714, art. 3(c) (with Sch. para. 8)

Modifications etc. (not altering text)

C49S. 23(1) restricted (15.11.1999) by S.I. 1999/2787, art. 4

Marginal Citations

24 Special administration orders made on special petitions.E+W

(1)If, on an application made to the High Court by petition presented—

(a)by the Secretary of State; or

(b)with the consent of the Secretary of State, by the Director,

that Court is satisfied in relation to any company which holds an appointment under Chapter I of this Part that any one or more of the grounds specified in subsection (2) below is satisfied in relation to that company, that Court may make a special administration order in relation to that company.

[F242(1A)If on an application made to the High Court by petition presented—

(a)by the Secretary of State (after consulting the Assembly); or

(b)with the consent of the Secretary of State (after consulting the Assembly), the Authority,

the Court is satisfied in relation to any company which is a qualifying licensed water supplier that any one or more of the grounds specified in subsection (2) below is satisfied in relation to that company, that Court may make a special administration order in relation to that company.]

(2)The grounds mentioned in [F243subsections (1) and (1A)] above are, in relation to any company—

(a)that there has been, is or is likely to be such a contravention by the company of any principal duty, not being a contravention in respect of which a notice has been served under subsection (3) of section 19 above, as is serious enough to make it inappropriate for the company to continue to hold its appointment [F244or licence];

(b)that there has been, is or is likely to be such a contravention by the company of the provisions of any enforcement order which—

(i)is not for the time being the subject-matter of proceedings brought by virtue of section 21(1) above; and

(ii)if it is a provisional enforcement order, has been confirmed,

as is serious enough to make it inappropriate for the company to continue to hold its appointment [F244or licence];

[F245(bb)in the case of a company which is a qualifying licensed water supplier, that—

(i)action taken by the company has caused a contravention by a water undertaker of any principal duty; and

(ii)that action is serious enough to make it inappropriate for the company to continue to hold its licence;]

(c)that the company is or is likely to be unable to pay its debts;

(d)that, in a case in which the Secretary of State has certified that it would be appropriate, but for section 25 below, for him to petition for the winding up of the company under [F246section 440 of the Companies Act 1985] [F246section 124A of the Insolvency Act 1986] (petition by the Secretary of State following inspectors’ report etc.), it would be just and equitable, as mentioned in that section, for the company to be wound up if it did not hold an appointment under Chapter I of this Part [F247or was not a qualifying licensed water supplier] ; or

(e)[F248in the case of a company holding an appointment under Chapter 1 of this Part,] that the company is unable or unwilling adequately to participate in arrangements certified by the Secretary of State or the Director to be necessary by reason of, or in connection with, a proposal for the making by virtue of section 7(4)(c) above of any appointment or variation replacing a company as a relevant undertaker.

(3)Notice of any petition under this section for a special administration order shall be given forthwith to such persons and in such manner as may be prescribed by rules made under section 411 of the M7Insolvency Act 1986 (“the 1986 Act”); and no such petition shall be withdrawn except with the leave of the High Court.

[F249(4)Subsections (4) and (5) of section 9 of the 1986 Act (powers on application for administration order) shall apply on the hearing of the petition for a special administration order in relation to any company as they apply on the hearing of a petition for an administration order.]

[F249(5)Subsections (1), (2) and (4) of section 10 of the 1986 Act (effect of petition) shall apply in the case of a petition for a special administration order in relation to any company as if—

(a)the reference in subsection (1) to an administration order were a reference to a special administration order;

(b)paragraph (b) of that subsection did require the leave of the court for the taking of any of the steps mentioned in paragraphs (b) and (c) of subsection (2) (appointment of, and exercise of functions by, administrative receiver); and

(c)the reference in paragraph (c) of subsection (1) to proceedings included a reference to any proceedings under or for the purposes of section 18 above.]

(6)For the purposes of this section a company is unable to pay its debts if—

(a)it is a limited company which is deemed to be so unable under section 123 of the 1986 Act (definition of inability to pay debts); or

(b)it is an unregistered company which is deemed, by virtue of any of sections 222 to 224 of that Act, to be so unable for the purposes of section 221 of that Act (winding up of unregistered companies).

[F250(7)In this section “principal duty” means—

(a)in relation to a company holding an appointment under Chapter 1 of this Part, a requirement imposed on the company by section 37 or 94 below;

(b)in relation to a company which is a qualifying licensed water supplier, any condition of its licence or any statutory requirement imposed on it in consequence of its licence.]

Textual Amendments

F244Words in s. 24(2)(a)(b) inserted (1.12.2005) by Water Act 2003 (c. 37), ss. 101(1), 105(3), Sch. 8 para. 9(3)(b); S.I. 2005/2714, art. 3(c) (with Sch. para. 8)

F246Words in s. 24(2)(d) substituted (1.10.2010 for specified purposes) by Flood and Water Management Act 2010 (c. 29), s. 49(3), Sch. 5 para. 6(4) (with s. 49(1)(6)); S.I. 2010/2169, art. 4, Sch.

F249S. 24(4)(5) ceases to have effect (1.10.2010 for specified purposes) by virtue of Flood and Water Management Act 2010 (c. 29), s. 49(3), Sch. 5 para. 6(2) (with s. 49(1)(6)); S.I. 2010/2169, art. 4, Sch.

Modifications etc. (not altering text)

Marginal Citations

25 Power to make special administration order on winding-up petition.E+W

On an application made to any court for the winding up of a company which holds an appointment under Chapter I of this Part [F251or is a qualifying licensed water supplier]

(a)the court shall not make a winding-up order in relation to the company; but

(b)if the court is satisfied that it would be appropriate to make such an order if the company were not a company holding such an appointment [F252or a qualifying licensed water supplier] , it shall, instead, make a special administration order in relation to the company.

Textual Amendments

Modifications etc. (not altering text)

Restrictions on voluntary winding up and insolvency proceedingsE+W

26 Restrictions on voluntary winding up and insolvency proceedings.E+W

(1)Where a company holds an appointment under Chapter I of this Part [F253or is a qualifying licensed water supplier]

(a)the company shall not be wound up voluntarily;

(b)no administration order shall be made in relation to the company under Part II of the M8Insolvency Act 1986; and

(c)no step shall be taken by any person to enforce any security over the company’s property except where that person has served fourteen days’ notice of his intention to take that step on the Secretary of State and on the Director.

(2)In this section “security” and “property” have the same meanings as in Parts I to VII of the M9Insolvency Act 1986.

Textual Amendments

Modifications etc. (not altering text)

Marginal Citations

CHAPTER IIIE+W PROTECTION OF CUSTOMERS ETC..

General provisions