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118.—(1) If there is a dispute between the Primary Care Trust and the contractor in relation to a contract sanction that the Primary Care Trust is proposing to impose, the Primary Care Trust shall not, subject to sub-paragraph (4), impose the proposed contract sanction except in the circumstances specified in sub-paragraph (2)(a) or (b).
(2) If the contractor refers the dispute relating to the contract sanction to the NHS dispute resolution procedure within 28 days beginning on the date on which the Primary Care Trust served notice on the contractor in accordance with paragraph 117(4) (or such longer period as may be agreed in writing with the Primary Care Trust), and notifies the Primary Care Trust in writing that it has done so, the Primary Care Trust shall not impose the contract sanction unless—
(a)there has been a determination of the dispute pursuant to paragraph 102 and that determination permits the Primary Care Trust to impose the contract sanction; or
(b)the contractor ceases to pursue the NHS dispute resolution procedure,
whichever is the sooner.
(3) If the contractor does not invoke the NHS dispute resolution procedure within the time specified in sub-paragraph (2), the Primary Care Trust shall be entitled to impose the contract sanction forthwith.
(4) If the Primary Care Trust is satisfied that it is necessary to impose the contract sanction before the NHS dispute resolution procedure is concluded in order to—
(a)protect the safety of the contractor’s patients; or
(b)protect itself from material financial loss,
the Primary Care Trust shall be entitled to impose the contract sanction forthwith, pending the outcome of that procedure.
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