Part I Preliminary

The Director General of Water Services

1 The Director General of Water Services

(1) There shall continue to be an officer known as the Director General of Water Services (in this Act referred to as “the Director”) for the purpose of carrying out the functions of that Director under this Act.

(2) Appointment of any person to hold office as the Director shall be made by the Secretary of State.

(3) An appointment of a person to hold office as the Director shall be for a term not exceeding five years; but previous appointment to that office shall not affect eligibility for re-appointment.

(4) The Director may at any time resign his office as the Director by notice addressed to the Secretary of State; and the Secretary of State may remove any person from that office on the ground of incapacity or misbehaviour.

(5) Subject to the preceding provisions of this section, the Director shall hold and vacate office as such in accordance with the terms of his appointment.

(6) The provisions of Schedule 1 to this Act shall have effect with respect to the Director.

General duties

2 General duties with respect to water industry

(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 the 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; 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.

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

(a) 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; and

(b) without prejudice to the generality of paragraph (a) above, to secure that companies holding appointments under Chapter I of Part II of this Act as relevant undertakers are able (in particular, by securing reasonable returns on their capital) to finance the proper carrying out of the functions of such undertakers.

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

(a) to ensure that the interests of every person who is a customer or potential customer of a company which has been or may be appointed under Chapter I of Part II of this Act to be a relevant undertaker are protected as respects the fixing and recovery by that company of water and drainage charges and, in particular—

(i) that the interests of customers and potential customers in rural areas are so protected; and

(ii) that no undue preference is shown, and that there is no undue discrimination, in the fixing of those charges;

(b) to ensure that the interests of every such person are also protected as respects the other terms on which any services are provided by that company in the course of the carrying out of the functions of a relevant undertaker and as respects the quality of those services;

(c) to ensure that the interests of every such person are further 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 (including a disposal before the Secretary of State and the Director became subject to the duties imposed by virtue of this paragraph) of any of that company’s protected land or of any interest or right in or over any of that land;

(d) to promote economy and efficiency on the part of any such company in the carrying out of the functions of a relevant undertaker; and

(e) to facilitate effective competition, with respect to such matters as he considers appropriate, between persons holding or seeking appointments under that Chapter.

(4) In performing his duty under subsection (3) above, so far as it requires him to do anything in the manner which he considers is best calculated to ensure that the interests of the customers and potential customers of any company are protected as respects the quality of any services provided by that company in the course of the carrying out of the functions of a relevant undertaker, the Secretary of State or, as the case may be, the Director shall take into account, in particular, the interests of those who are disabled or of pensionable age.

(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.

(6) For the purposes of this section—

(a) the reference in subsection (1) above to the provisions of this Act relating to the regulation of relevant undertakers is a reference to the provisions contained in Part II of this Act (except section 28 and Schedule 4), or in any of sections 38, 39, 95, 96, 153, 181, 182, 193 to 195 and 201 to 203 below;

(b) the 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, 48, 99 and 100 below; and

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

3 General environmental and recreational duties

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

(a) the Secretary of State;

(b) the Minister of Agriculture, Fisheries and Food;

(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;

(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 the NRA; 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 the NRA 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.

4 Environmental duties with respect to sites of special interest

(1) Where the Nature Conservancy Council for England or the Countryside Council for Wales 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,

that Council 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 the Nature Conservancy Council for England, the Countryside Council for Wales, 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 [1988 c. 4.] Norfolk and Suffolk Broads Act 1988; and

• “National Park authority” means a National Park Committee or a joint or special planning board for a National Park;

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.

5 Codes of practice with respect to environmental and recreational duties

(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 and the Minister of Agriculture, Fisheries and Food shall each 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 [1989 c. 15.] Water 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) the NRA;

(b) the Countryside Commission, the Nature Conservancy Council for England and the Countryside Council for Wales;

(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 [1991 c. 57.] Water Resources Act 1991, the [1991 c. 58.] Statutory Water Companies Act 1991, the [1991 c. 59.] Land Drainage Act 1991 and the [1991 c. 60.] Water Consolidation (Consequential Provisions) Act 1991.

Part II Appointment and Regulation of Undertakers

Chapter I Appointments

Making of appointments

6 Appointment of relevant undertakers

(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 unless it is a limited company or a statutory water company and shall not be appointed to be a sewerage undertaker unless it is a limited company.

(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

(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 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.

8 Procedure with respect to appointments and variations

(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 on the existing appointee and on 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 on the existing appointee and on 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 on 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.

9 Duties affecting making of appointments and variations

(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) 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.

10 Transitional provision with respect to replacement appointments

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.

Conditions of appointments

11 Power to impose conditions

(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

(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 Monopolies and Mergers Commission (in this Act referred to as “the Monopolies Commission”),

of such questions arising under the appointment and of such other matters, including (in the case of references to the Commission) 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 Monopolies Commission 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 that Commission; and

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

(i) any regulations under subsection (4) below; and

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

(4) The Secretary of State may by regulations make such provision as he considers appropriate for regulating the procedure to be followed with respect to the reference of any question or other matter to the Monopolies Commission in pursuance of provision contained in an appointment under this Chapter.

(5) Without prejudice to the generality of the power conferred by subsection (4) above, regulations under that subsection may, in relation to any such reference as is mentioned in that subsection, apply (with or without modifications) the provisions of any enactment relating to references to the Monopolies Commission under the following provisions of this Act, the 1973 Act or the 1980 Act.

Modification of appointment conditions

13 Modification by agreement

(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 Monopolies Commission

(1) The Director may make to the Monopolies Commission a reference which is so framed as to require the Commission 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 Monopolies Commission 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 the Commission 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 Monopolies Commission 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 Monopolies Commission in carrying out an investigation on a reference under this section, to give to the Commission—

(a) any information in his possession which relates to matters falling within the scope of the investigation, and which is either—

(i) requested by the Commission for that purpose; or

(ii) information which, in his opinion, it would be appropriate for that purpose to give to the Commission without any such request;

and

(b) any other assistance which the Commission may require, and which it is within his power to give, in relation to any such matters;

and the Commission, for the purpose of carrying out any such investigation, 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 Monopolies Commission 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.

(7) Sections 70 (time limit for report on merger reference), 81 (procedure in carrying out investigations) and 85 (attendance of witnesses and production of documents) of the 1973 Act, Part II of Schedule 3 to that Act (performance of functions of the Monopolies Commission) and section 24 of the 1980 Act (modifications of provisions about performance of such functions) shall apply in relation to references under this section as if—

(a) the functions of the Commission in relation to those references were functions under the 1973 Act;

(b) the expression “merger reference” included a reference under this section;

(c) in the said section 70, references to the Secretary of State were references to the Director and the reference to three months were a reference to six months;

(d) in paragraph 11 of the said Schedule 3, the reference to section 71 of the 1973 Act were a reference to subsection (2) above; and

(e) paragraph 16(2) of that Schedule were omitted.

(8) For the purposes of references under this section, there shall be not less than eight additional members of the Monopolies Commission appointed from time to time by the Secretary of State; and, if any functions of that Commission in relation to any such reference are performed through a group—

(a) the chairman of that Commission shall select one or more of those additional members to be members of the group; and

(b) the number of regular members to be selected by him under paragraph 10 of Schedule 3 to the 1973 Act shall be reduced by the number of additional members selected.

15 Reports on modification references

(1) In making a report on a reference under section 14 above, the Monopolies Commission—

(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.

(2) Where, on a reference under section 14 above, the Monopolies Commission conclude that a company holding an appointment under this Chapter is a party to an agreement to which the [1976 c. 34.] Restrictive Trade Practices Act 1976 applies, the Commission, in making their report on that reference, shall exclude from their consideration the question whether the provisions of that agreement, in so far as they are provisions by virtue of which it is an agreement to which that Act applies, operate, or may be expected to operate, against the public interest; and paragraph (b) of subsection (1) above shall have effect subject to the provisions of this subsection.

(3) Section 82 of the 1973 Act (general provisions as to reports) shall apply in relation to reports of the Monopolies Commission on references under section 14 above as it applies to reports of the Commission under that Act.

(4) A report of the Monopolies Commission 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

(1) Where a report of the Monopolies Commission 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.

(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.

17 Modification by order under other enactments

(1) Subject to subsection (3) below, where in the circumstances mentioned in subsection (2) below the Secretary of State by order exercises any of the powers specified in—

(a) Parts I and II of Schedule 8 to the 1973 Act; or

(b) section 10(2)(a) of the 1980 Act,

the order may also provide for the modification of the conditions of a company’s appointment under this Chapter to such extent as may appear to him to be requisite or expedient for the purpose of giving effect to, or taking account of, any provision made by the order.

(2) Subsection (1) above shall have effect where—

(a) the circumstances are as mentioned in section 56(1) of the 1973 Act (order on report on monopoly reference) and the monopoly situation exists in relation to the carrying out of any of the functions of a relevant undertaker;

(b) the circumstances are as mentioned in section 73(1) of that Act (order on report on merger reference) and the two or more enterprises which ceased to be distinct enterprises were both engaged in carrying out functions of a relevant undertaker; or

(c) the circumstances are as mentioned in section 10(1) of the 1980 Act (order on report on competition reference) and the anti-competitive practice relates to the carrying out of any of the functions 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.

(4) Expressions used in this section and in the 1973 Act or the 1980 Act have the same meanings in this section as in that Act.

Chapter II Enforcement and Insolvency

Enforcement orders

18 Orders for securing compliance with certain provisions

(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 the Secretary of State or the Director is satisfied—

(a) that that company is contravening—

(i) any condition of the company’s appointment 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 has contravened any such condition or requirement and is likely to do so again,

he 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—

(a) it appears to the Secretary of State or the Director as mentioned in paragraph (a) or (b) of subsection (1) 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

(ii) has contravened any such condition or requirement and is likely to do so again;

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 shall be such of the requirements of any enactment or of any subordinate legislation as—

(i) are imposed in consequence of that appointment; 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; 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.

(8) Where any act or omission constitutes a contravention of a condition of an appointment under Chapter I of this Part or of a statutory or other requirement enforceable under this section, the only remedies for 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 such a contravention.

19 Exceptions to duty to enforce

(1) 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;

(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.

(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), (b) or (c) of subsection (1) above, he shall—

(a) serve notice that he is so satisfied on the company;

(b) publish a copy of the notice in such manner as he 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

(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.

(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.

20 Procedure for enforcement orders

(1) Before making a final enforcement order or confirming a provisional enforcement order, 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 twenty-eight 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.

(2) A notice under subsection (1) 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 twenty-eight 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.

21 Validity of enforcement orders

(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

(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) 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.

Special administration orders

23 Meaning and effect of special administration order

(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 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 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).

(3) Schedule 3 to this Act shall have effect for applying provisions of the [1986 c. 45.] Insolvency Act 1986 where a special administration order is made.

(4) 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, without an appointment or variation under Chapter I of this Part, in pursuance of a special administration order.

(5) In this section “business” and “property” have the same meanings as in the [1986 c. 45.] Insolvency Act 1986.

24 Special administration orders made on special petitions

(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.

(2) The grounds mentioned in subsection (1) 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;

(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;

(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 section 440 of the [1985 c. 6.] Companies Act 1985 (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; or

(e) 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 [1986 c. 45.] Insolvency Act 1986 (“the 1986 Act”); and no such petition shall be withdrawn except with the leave of the High Court.

(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.

(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).

(7) In this section “principal duty”, in relation to a company, means a requirement imposed on the company by section 37 or 94 below.

25 Power to make special administration order on winding-up petition

On an application made to any court for the winding up of a company which holds an appointment under Chapter I of this Part—

(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, it shall, instead, make a special administration order in relation to the company.

Restrictions on voluntary winding up and insolvency proceedings

26 Restrictions on voluntary winding up and insolvency proceedings

(1) Where a company holds an appointment under Chapter I of this Part—

(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 [1986 c. 45.] Insolvency 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 [1986 c. 45.] Insolvency Act 1986.

Chapter III Protection of Customers etc.

General provisions

27 General duty of Director to keep matters under review

(1) It shall be the duty of the Director, so far as it appears to him practicable from time to time to do so, to keep under review the carrying on both in England and Wales and elsewhere of activities connected with the matters in relation to which water undertakers or sewerage undertakers carry out functions.

(2) It shall also be the duty of the Director, so far as it appears to him practicable from time to time to do so, to collect information with respect to—

(a) the carrying out by companies appointed under Chapter I of this Part of the functions of relevant undertakers; or

(b) any such company,

with a view to his becoming aware of, and ascertaining the circumstances relating to, matters with respect to which any power or duty is conferred or imposed on him by or under any enactment.

(3) The Secretary of State may give general directions indicating—

(a) considerations to which the Director should have particular regard in determining the order of priority in which matters are to be brought under review in performing his duty under subsection (1) or (2) above; and

(b) considerations to which, in cases where it appears to the Director that any of his powers under Parts II to V and VII of this Act are exercisable, he should have particular regard in determining whether to exercise those powers;

and it shall be the duty of the Director to comply with any such directions.

(4) It shall be the duty of the Director, where either he considers it expedient or he is requested by the Secretary of State or the Director General of Fair Trading to do so, to give information, advice and assistance to the Secretary of State or that Director with respect to any matter relating to—

(a) the functions of either description of relevant undertaker; or

(b) the carrying out of any such functions by a company holding an appointment under Chapter I of this Part.

28 Customer service committees

(1) Every company holding an appointment under Chapter I of this Part shall be allocated by the Director to a committee established and maintained by him for the purpose, in relation to such companies as may be allocated to it, of carrying out—

(a) the functions assigned by this Act to such a committee; and

(b) such other functions as the committees maintained under this section may be required to carry out by the Director.

(2) The committees maintained under this section shall be known as customer service committees.

(3) There shall not at any time be more than ten customer service committees, but it shall be the duty of the Director so to exercise his powers under this section to establish and maintain customer service committees and to allocate companies to those committees as to secure that at all times—

(a) such customer service committees are maintained; and

(b) such allocations under subsection (1) above are in force,

as he considers appropriate for ensuring that the interests of the customers and potential customers of the companies for the time being holding appointments under Chapter I of this Part are effectively represented.

(4) A customer service committee shall consist of—

(a) a chairman appointed by the Director after consultation with the Secretary of State; and

(b) such number (not less than ten nor more than twenty) of other members appointed by the Director as the Director may determine.

(5) In appointing persons to be members of a customer service committee the Director shall have regard to—

(a) the desirability of the persons appointed being persons who have experience of, and have shown capacity in, some matter relevant to—

(i) the functions of a water undertaker or sewerage undertaker; or

(ii) the carrying out of those functions in relation to any area by a company which the Director has allocated, or is proposing to allocate, to that committee;

and

(b) the desirability of—

(i) the committee including one or more persons with experience of work among, and the special needs of, disabled persons; and

(ii) persons appointed by virtue of this paragraph including disabled persons.

(6) An appointment of a person to hold office as the chairman of a customer service committee shall be for a term not exceeding four years.

(7) Subject to subsection (6) above, the chairman and other members of a customer service committee shall hold and vacate office in accordance with the terms of their appointments and, notwithstanding that subsection, shall on ceasing to hold office be eligible for re-appointment.

(8) The provisions of Schedule 4 to this Act shall have effect with respect to customer service committees.

29 Duties of customer service committees

(1) It shall be the duty of a customer service committee—

(a) to keep under review all matters appearing to the committee to affect the interests of the persons who are customers or potential customers of the companies allocated to the committee;

(b) to consult each company so allocated about such of those matters as appear to affect the interests of the customers or potential customers of that company; and

(c) to make to a company so allocated all such representations about any such matter as the committee considers appropriate.

(2) Subject to subsection (3) below, it shall be the duty of a customer service committee to investigate any complaint which—

(a) is made to the committee by any person who is a customer or potential customer of a company allocated to the committee or is referred to the committee by the Director under section 30 below;

(b) does not appear to the committee to be vexatious or frivolous; and

(c) relates to the carrying out by that company of any of the functions of a relevant undertaker.

(3) It shall be the duty of a customer service committee to refer to the Director every complaint which is made to the committee by any person in relation to a company allocated to the committee and consists in or amounts to—

(a) an assertion that the company is contravening or has contravened any condition of the company’s appointment under Chapter I of this Part or any statutory or other requirement enforceable under section 18 above; or

(b) a complaint which the Director would be required to investigate under section 181 below.

(4) It shall be the duty of a customer service committee, where the committee considers it appropriate to do so in connection with any such complaint as is mentioned in subsection (2) above, to make representations on behalf of the complainant to the company in question about any matter—

(a) to which the complaint relates; or

(b) which appears to the committee to be relevant to the subject-matter of the complaint;

and it shall be the duty of a customer service committee to refer to the Director or, as the case may be, back to the Director any such complaint as is so mentioned which the committee is unable to resolve.

(5) The only remedy for a breach by a customer service committee of a duty imposed on it by this section shall be the making of such a complaint to the Director as the Director is required to consider under section 30(3)(c) below.

(6) It shall be the duty of the Director to make such arrangements as he considers appropriate for facilitating the provision by one customer service committee to another of any such information as that other committee may require for any purpose relating to the carrying out of its functions.

30 Duties of Director with respect to complaints

(1) Where a complaint is made to the Director by a customer or potential customer of a company allocated to a customer service committee and the complaint does not consist in or amount to—

(a) an assertion that the company is contravening or has contravened any condition of the company’s appointment under Chapter I of this Part or any statutory or other requirement enforceable under section 18 above; or

(b) a complaint which the Director is required to investigate under section 181 below,

it shall be the duty of the Director to consider whether the complaint should be referred to that committee, instead of being dealt with by the Director himself.

(2) Where a complaint which does consist in or amount to such an assertion as is mentioned in subsection (2)(a) above—

(a) is made to the Director by a customer or potential customer of any company allocated to a customer service committee; or

(b) is referred to him by such a committee,

it shall be the duty of the Director to consider whether the complaint should be referred by him to the Secretary of State.

(3) It shall be the duty of the Director to consider the following complaints, that is to say—

(a) any complaint to which the duty imposed by subsection (2) above applies and which is not referred by the Director to the Secretary of State;

(b) any complaint which is referred to the Director under section 29(4) above; and

(c) any complaint made to the Director by a customer or potential customer of a company allocated to a customer service committee that the committee has failed to perform any duty imposed on it by section 29(1) to (4) above.

(4) It shall be the duty of the Director to take such steps in consequence of his consideration of any matter in pursuance of this section (including, in a case falling within subsection (3)(b) or (c) above, any step which could have been taken by the committee itself) as he considers appropriate.

Provisions with respect to competition

31 Functions of Director with respect to competition

(1) If and to the extent that he is requested by the Director General of Fair Trading to do so, it shall be the duty of the Director to exercise the functions of that Director under Part III of the 1973 Act so far as relating to courses of conduct which are or may be detrimental to the interests of persons who are consumers in relation to—

(a) the supply of water by water undertakers; or

(b) the provision of sewerage services by sewerage undertakers;

and this duty shall apply whether those interests are economic or interests in respect of health, safety or other matters.

(2) The Director shall continue to be entitled, concurrently with the Director General of Fair Trading, to exercise—

(a) the functions of that Director under sections 44 and 45 of the 1973 Act; and

(b) the functions of that Director under sections 50, 52, 53, 86 and 88 of that Act,

so far as relating to monopoly situations which exist or may exist in relation to commercial activities connected with the supply of water or the provision of sewerage services.

(3) The Director shall continue to be entitled, concurrently with the Director General of Fair Trading, to exercise the functions of that Director under sections 2 to 10 and 16 of the 1980 Act so far as relating to courses of conduct which have or are intended to have or are likely to have the effect of restricting, distorting, or preventing competition in connection with the supply of water or securing a supply of water or with the provision or securing of sewerage services.

(4) So far as necessary for the purposes of or in connection with the provisions of subsections (1) to (3) above, the references to the Director General of Fair Trading in—

(a) Parts III and IV of the 1973 Act;

(b) sections 86, 88 and 133 of the 1973 Act; and

(c) sections 2 to 10, 16 and 19 of the 1980 Act,

shall be construed as if they were or, as the case may require, as if they included references to the Director.

(5) Before either Director first exercises in relation to any matter functions mentioned in paragraph (a) or in paragraph (b) of subsection (2) above or in subsection (3) above, he shall consult the other Director.

(6) Neither Director shall exercise in relation to any matter any functions mentioned in paragraph (a) or in paragraph (b) of subsection (2) above or in subsection (3) above if any of the functions mentioned in that paragraph or, as the case may be, in subsection (3) above have already been exercised in relation to that matter by the other Director.

(7) It shall be the duty of the Director, for the purpose of assisting the Monopolies Commission in carrying out an investigation on a reference made to them by the Director by virtue of subsection (2) or (3) above, to give to the Commission—

(a) any information which is in his possession and which relates to matters falling within the scope of the investigation, and which is either requested by the Commission for that purpose or is information which in his opinion it would be appropriate for that purpose to give to the Commission without any such request; and

(b) any other assistance which the Commission may require, and which it is within his power to give, in relation to any such matters;

and the Commission shall, for the purposes of carrying out any such investigation, take into account any information given to them for that purpose under this subsection.

(8) If any question arises as to whether subsection (2) or (3) above applies to any particular case, that question shall be referred to and determined by the Secretary of State; and no objection shall be taken to anything done under—

(a) Part IV or section 86 or 88 of the 1973 Act; or

(b) sections 2 to 10 of the 1980 Act,

by or in relation to the Director on the ground that it should have been done by or in relation to the Director General of Fair Trading.

(9) Expressions used in the 1973 Act or the 1980 Act and in this section have the same meanings in this section as in that Act.

32 Duty to refer merger of water or sewerage undertakings

(1) Subject to the following provisions of this section and to section 33 below, it shall be the duty of the Secretary of State to make a merger reference to the Monopolies Commission if it appears to him that it is or may be the fact—

(a) that arrangements are in progress which, if carried into effect, will result in a merger of any two or more water enterprises; or

(b) that such a merger has taken place otherwise than as a result of the carrying into effect of arrangements that have been the subject of a reference by virtue of paragraph (a) above.

(2) The Secretary of State shall not make a merger reference under this section in respect of any actual or prospective merger of two or more water enterprises if it appears to him that the take over from which the merger has resulted or, as the case may be, would result was initiated before 9 a.m. on 11th January 1989.

(3) For the purposes of subsection (2) above a merger of two or more enterprises results from a take over initiated before 9 a.m. on 11th January 1989 if—

(a) the Secretary of State or the Director General of Fair Trading was given notice before that time on that date of the material facts about the proposed arrangements or transactions resulting in the merger; or

(b) the merger results exclusively from the acceptance of offers to acquire shares in a body corporate and those offers—

(i) were all made before that time on that date; or

(ii) in so far as they were not so made, consist in offers made, by the same person and in respect of the same shares, in substitution for offers made before that time on that date.

33 Exclusion of small mergers from duty to make merger reference

(1) The Secretary of State shall not make a merger reference under section 32 above in respect of any actual or prospective merger of two or more water enterprises if it appears to him—

(a) that the value of the assets taken over does not exceed or, as the case may be, would not exceed the amount for the time being specified in section 64(1)(b) of the 1973 Act (condition of merger reference relating to amount of assets taken over); or

(b) that the only water enterprises already belonging to the person making the take over are enterprises each of which has assets the value of which does not exceed or, as the case may be, would not exceed that amount.

(2) In relation to a merger of two or more water enterprises—

(a) the value of the assets taken over shall, for the purposes of subsection (1) above, be determined in accordance with section 67 of the 1973 Act by reference only to assets employed in or appropriated to a water enterprise; and

(b) the value of the assets of a water enterprise belonging to the person making the take over shall be taken for those purposes to be the value of such assets employed in or appropriated to that enterprise as by virtue of the exceptions in paragraph (a) of subsection (2) of that section are disregarded in determining the value of the assets taken over;

and paragraph (b) of that subsection shall apply for determining the value of the assets referred to in paragraph (b) above as it applies in relation to the assets taken over.

(3) For the purposes of this section and of any determination in accordance with this section—

(a) the assets treated as employed in or appropriated to a water enterprise carried on by a company holding an appointment under Chapter I of this Part shall include all the assets for the time being of that company;

(b) every water enterprise any of whose assets fall to be disregarded as mentioned in subsection (2)(b) above shall be treated as belonging to the person making the take over;

(c) the enterprises mentioned in paragraph (b) above shall be treated as separate enterprises in so far as they are carried on by different companies holding appointments under Chapter I of this Part; and

(d) subsections (3) and (4) of section 67 of the 1973 Act (assets treated as appropriated to an enterprise and mergers over a period) shall apply as they apply for the purposes of, and of any determination in accordance with, subsection (2) of that section.

(4) If the Secretary of State considers that it is appropriate—

(a) for subsection (1) above to have effect with a reference in paragraph (a) to a different amount; or

(b) for the condition set out in that paragraph to be modified in any other respect,

he may, in relation to mergers after the coming into force of the regulations, by regulations make such modifications of that paragraph and, for that purpose, of the other provisions of this section as may be prescribed.

34 References with respect to water enterprise mergers

(1) Subject to subsections (2) to (4) below, the 1973 Act shall have effect in relation to any reference under section 32 above as if—

(a) any such merger of two or more water enterprises as is required to be the subject of such a reference were a merger situation qualifying for investigation; and

(b) a reference under that section were made under section 64 of that Act or, as the case may be, under section 75 of that Act (references in anticipation of a merger).

(2) Nothing in subsection (1) above shall have the effect in relation to any reference under section 32 above of applying—

(a) so much of Part V of the 1973 Act as requires the Monopolies Commission to consider any of the matters set out in subsection (1) of section 64 of that Act; or

(b) the provisions of sections 69(2) to (4) and 75(3) of that Act (power to restrict matters referred).

(3) In determining on a reference under section 32 above whether any matter operates, or may be expected to operate, against the public interest the Monopolies Commission—

(a) shall have regard to the desirability of giving effect to the principle that the number of water enterprises which are under independent control should not be reduced so as to prejudice the Director’s ability, in carrying out his functions by virtue of this Act, to make comparisons between different such water enterprises; and

(b) shall have regard to the desirability of achieving any other purpose so far only as they are satisfied—

(i) that that other purpose can be achieved in a manner that does not conflict with that principle; or

(ii) that the achievement of that other purpose is of substantially greater significance in relation to the public interest than that principle and cannot be brought about except in a manner that conflicts with that principle.

(4) No order shall be made under Part V of the 1973 Act in consequence of any merger reference made under section 32 above in respect of an actual merger unless the reference was made within the period of six months beginning with whichever is the later of—

(a) the day on which the merger took place; and

(b) the day on which the material facts about the transactions which resulted in the merger first came to the notice of the Secretary of State or the Director General of Fair Trading or were made public within the meaning of section 64 of the 1973 Act;

and if on such a reference the Monopolies Commission are satisfied that the reference was not made within that period their report on the reference shall state that fact and nothing else.

35 Construction of merger provisions

(1) In this Chapter–

• “enterprise” has the meaning given for the purposes of sections 64 to 77 of the 1973 Act by section 63(2) of that Act; and

• “water enterprise” means an enterprise carried on by a relevant undertaker.

(2) References in this Chapter, in relation to any two or more enterprises, to the merger of those enterprises are references to those enterprises ceasing, within the meaning of Part V of the 1973 Act, to be distinct enterprises; and sections 66 and 66A of that Act (time at which enterprises cease to be distinct) shall have effect for the purposes of this Chapter as they have effect for the purposes of that Part.

(3) The reference in section 34(3) above to the number of water enterprises under independent control is a reference to the number of water enterprises there would be if two or more water enterprises counted as one enterprise wherever they would be treated for the purposes of Part V of the 1973 Act as having ceased to be distinct enterprises.

(4) Nothing in sections 32 to 34 above shall prejudice any power of the Secretary of State, in a case in which he is not required to make a reference under section 32 above, to make a merger reference under Part V of the 1973 Act in respect of any actual or prospective merger of two or more water enterprises.

Chapter IV Interpretation of Part II

36 Interpretation of Part II

(1) In this Part—

• “the 1973 Act” means the [1973 c. 41.] Fair Trading Act 1973; and

• “the 1980 Act” means the [1980 c. 21.] Competition Act 1980.

(2) References in this Part to an appointment or variation replacing a company as a relevant undertaker are references to the following, that is to say—

(a) the appointment of a company to be the water undertaker or sewerage undertaker for any area which is or includes the whole or any part of any area for which another company already holds an appointment as water undertaker or, as the case may be, sewerage undertaker; or

(b) a variation by virtue of which the area for which a company holds an appointment under Chapter I of this Part is modified so as to include the whole or any part of an area for which another company already holds an appointment as water undertaker or, as the case may be, sewerage undertaker.

(3) For the purposes of this Part premises in a part of an area are served by a company holding an appointment under Chapter I of this Part—

(a) in relation to an appointment or variation by virtue of which that company would be replaced as the water undertaker for that part of that area, if those premises—

(i) are supplied with water by means of a connection with a distribution main of that company; or

(ii) consist in a building or part of a building which is situated within thirty metres of such a main;

and

(b) in relation to an appointment or variation by virtue of which that company would be replaced as the sewerage undertaker for that part of that area, if those premises—

(i) are drained by means of a relevant sewer; or

(ii) consist in a building or part of a building which is situated within thirty metres of such a sewer, not being a storm-water overflow sewer.

(4) In this section—

• “distribution main” means a water main that is not a trunk main; and

• “relevant sewer”, in relation to any appointment or variation which would replace a company as a sewerage undertaker, means any of the following, that is to say—

  (a)

  a public sewer vested in that company;

  (b)

  a sewer in relation to which that company has made a declaration of vesting under section 102 below which has not yet taken effect;

  (c)

  a drain or sewer in relation to which that company has entered into an agreement under section 104 below.

Part III Water Supply

Chapter I General Duties of Water Undertakers

37 General duty to maintain water supply system etc

(1) It shall be the duty of every water undertaker to develop and maintain an efficient and economical system of water supply within its area and to ensure that all such arrangements have been made—

(a) for providing supplies of water to premises in that area and for making such supplies available to persons who demand them; and

(b) for maintaining, improving and extending the water undertaker’s water mains and other pipes,

as are necessary for securing that the undertaker is and continues to be able to meet its obligations under this Part.

(2) The duty of a water undertaker under this section shall be 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) The obligations imposed on a water undertaker by the following Chapters of this Part, and the remedies available in respect of contraventions of those obligations, shall be in addition to any duty imposed or remedy available by virtue of any provision of this section or section 38 below and shall not be in any way qualified by any such provision.

38 Standards of performance in connection with water supply

(1) For the purpose–

(a) of facilitating the determination of the extent to which breaches of the obligations imposed by the following provisions of this Part are to amount to breaches of the duty imposed by section 37 above; or

(b) of supplementing that duty by establishing overall standards of performance in relation to that duty,

the Secretary of State may, in accordance with section 39 below, by regulations provide for contraventions of such requirements as may be prescribed to be treated for the purposes of this Act as breaches of that duty.

(2) The Secretary of State may, in accordance with section 39 below, by regulations prescribe such standards of performance in connection with the provision of supplies of water as, in his opinion, ought to be achieved in individual cases.

(3) Regulations under subsection (2) above may provide that if a water undertaker fails to meet a prescribed standard it shall pay such amount as may be prescribed to any person who is affected by the failure and is of a prescribed description.

(4) Without prejudice to the generality of the power conferred by subsection (2) above, regulations under that subsection may—

(a) include in a standard of performance a requirement for a water undertaker, in prescribed circumstances, to inform a person of his rights by virtue of any such regulations;

(b) provide for any dispute under the regulations to be referred by either party to the dispute to the Director;

(c) make provision for the procedure to be followed in connection with any such reference and for the Director’s determination on such a reference to be enforceable in such manner as may be prescribed;

(d) prescribe circumstances in which a water undertaker is to be exempted from requirements of the regulations.

39 Procedure for regulations under section 38

(1) The Secretary of State shall not make any regulations under section 38 above unless—

(a) the Director has made to the Secretary of State a written application complying with subsection (2) below;

(b) the Secretary of State is satisfied that a copy of the application has been served by the Director on every water undertaker specified in the application;

(c) such period as the Secretary of State considers appropriate has been allowed for the making—

(i) by the Director; and

(ii) by any affected water undertaker,

of representations or objections with respect to the Director’s proposals and any modifications proposed by the Secretary of State; and

(d) the Secretary of State has considered both the Director’s reasons for his proposals and every representation or objection which has been duly made with respect to those proposals, or any proposed modifications of those proposals, and has not been withdrawn.

(2) An application made by the Director to the Secretary of State complies with this subsection if it—

(a) sets out draft provisions proposed by the Director for inclusion in regulations under section 38 above;

(b) specifies the water undertaker or undertakers in relation to which it is proposed those provisions should apply; and

(c) summarises the Director’s reasons for his proposals.

(3) The Secretary of State shall not make any regulations under section 38 above except where—

(a) the only provisions of the regulations are the provisions proposed by the Director in his application or those provisions with such modifications as the Secretary of State considers appropriate; and

(b) each of the modifications (if any) of the Director’s proposals to which effect is given by the regulations is a modification the proposal to make which has been notified—

(i) to the Director; and

(ii) to any water undertaker appearing to the Secretary of State to be likely to be affected by the modifications.

Chapter II Supply Duties

Major supplies

40 Bulk supplies

(1) Where, on the application of a water undertaker—

(a) it appears to the Director that it is necessary or expedient for the purposes of this Part that another water undertaker should give a supply of water in bulk to the applicant; and

(b) he is satisfied that the giving and taking of such a supply cannot be secured by agreement,

the Director may by order require the undertakers to give and to take such a supply for such period and on such terms and conditions as may be provided in the order.

(2) An order under this section shall have effect as an agreement between the water undertakers in question but may be varied or revoked by a subsequent order made by the Director on the application of either of those undertakers, as well as by agreement between the undertakers.

(3) The Director shall not make an order under this section which he considers affects the carrying out by the NRA of any of its functions unless he has first consulted the NRA.

(4) In determining what provision to make by an order under this section in respect of the giving of any supply by a water undertaker the Director shall have regard to the desirability of the undertaker’s recovering the expenses of complying with its obligations under this section and of securing a reasonable return on its capital.

41 Duty to comply with water main requisition

(1) It shall be the duty of a water undertaker (in accordance with section 44 below) to provide a water main to be used for providing such supplies of water to premises in a particular locality in its area as (so far as those premises are concerned) are sufficient for domestic purposes, if–

(a) the undertaker is required to provide the main by a notice served on the undertaker by one or more of the persons who under subsection (2) below are entitled to require the provision of the main for that locality;

(b) the premises in that locality to which those supplies would be provided by means of that main are—

(i) premises consisting in buildings or parts of buildings; or

(ii) premises which will so consist when proposals made by any person for the erection of buildings or parts of buildings are carried out;

and

(c) the conditions specified in section 42 below are satisfied in relation to that requirement.

(2) Each of the following persons shall be entitled to require the provision of a water main for any locality, that is to say—

(a) the owner of any premises in that locality;

(b) the occupier of any premises in that locality;

(c) any local authority within whose area the whole or any part of that locality is situated;

(d) where the whole or any part of that locality is situated in a new town, within the meaning of the [1981 c. 64.] New Towns Act 1981—

(i) the Commission for the New Towns; and

(ii) the Development Board for Rural Wales or the development corporation for the new town, according to whether or not the new town is situated within the area for which that Board is for the time being responsible;

and

(e) where the whole or any part of that locality is situated within an area designated as an urban development area under Part XVI of the [1980 c. 65.] Local Government, Planning and Land Act 1980, the urban development corporation.

(3) The duty of a water undertaker under this section to provide a water main shall be owed to the person who requires the provision of the main or, as the case may be, to each of the persons who joins in doing so.

(4) Where a duty is owed by virtue of subsection (3) above to any person, any breach of that duty which causes that person to sustain loss or damage shall be actionable at the suit of that person; but, in any proceedings brought against a water undertaker in pursuance of this subsection, it shall be a defence for the undertaker to show that it took all reasonable steps and exercised all due diligence to avoid the breach.

(5) In this section “local authority”, in relation to the Inner Temple and the Middle Temple, includes, respectively, the Sub-Treasurer of the Inner Temple and the Under-Treasurer of the Middle Temple.

42 Financial conditions of compliance

(1) The conditions mentioned in section 41(1)(c) above are satisfied in relation to a requirement for the provision of a water main by a water undertaker if—

(a) such undertakings as the undertaker may have reasonably required in accordance with subsection (2) below have been given by the person or persons who have required the provision of the main; and

(b) such security as the undertaker may have reasonably required has been provided for the discharge of any obligations imposed by those undertakings on any person who, under subsection (3) below, may be required to secure his undertakings.

(2) The undertakings which a water undertaker may require for the purposes of subsection (1) above in respect of any water main are undertakings which—

(a) bind the person or persons mentioned in that subsection to pay to the undertaker, in respect of each of the twelve years following the provision of the main, an amount not exceeding the relevant deficit (if any) for that year on that main; and

(b) in the case of undertakings binding two or more persons, bind them either jointly and severally or with liability to pay apportioned in such manner as they may agree.

(3) For the purposes of subsection (1)(b) above a person may be required to secure his undertakings in relation to the provision of a water main if—

(a) it was by virtue of section 41(2)(a) or (b) above that he required, or joined in requiring, the provision of the main; and

(b) he is not a public authority.

(4) Where for the purposes of subsection (1)(b) above any sums have been deposited with a water undertaker by way of security for the discharge of any obligation, the undertaker shall pay interest at such rate as may be determined either—

(a) by the undertaker with the approval of the Director; or

(b) in default of a determination under paragraph (a) above, by the Director,

on every sum of 50p so deposited for every three months during which it remains in the hands of the undertaker.

(5) An approval or determination given or made by the Director for the purposes of subsection (4) above—

(a) may be given or made in relation to the provision of a particular water main, in relation to the provision of mains of a particular description or in relation to the provision of water mains generally; and

(b) may be revoked at any time.

(6) Any dispute between a water undertaker and any other person as to—

(a) the undertakings or security required by the undertaker for the purposes of this section; or

(b) the amount required to be paid in pursuance of any such undertaking,

shall be referred to the arbitration of a single arbitrator appointed by agreement between the undertaker and that person or, in default of agreement, by the President of the Institution of Civil Engineers.

(7) In this section “relevant deficit” has the meaning given by section 43 below.

43 Calculation of “relevant deficit” for the purposes of section 42

(1) For the purposes of section 42 above the relevant deficit for any year on a water main is the amount (if any) by which the water charges payable for the use during that year of that main are exceeded by the annual borrowing costs of a loan of the amount required for the provision of that main.

(2) The annual borrowing costs of a loan of the amount required for the provision of a water main is the aggregate amount which would fall to be paid in any year by way of payments of interest and repayments of capital if an amount equal to so much of the costs reasonably incurred in providing that main as were not incurred in the provision of additional capacity had been borrowed, by the water undertaker providing the main, on terms—

(a) requiring interest to be paid and capital to be repaid in twelve equal annual instalments; and

(b) providing for the amount of the interest to be calculated at such rate, and in accordance with such other provision, as may have been determined for the purposes of this subsection.

(3) A determination for the purposes of subsection (2) above shall be made either—

(a) by the undertaker with the approval of the Director; or

(b) in default of such a determination, by the Director.

(4) For the purposes of this section the costs reasonably incurred in providing a water main (“the new main”) shall include—

(a) the costs reasonably incurred in providing such other water mains and such tanks, service reservoirs and pumping stations as it is necessary to provide in consequence of the provision of the new main; and

(b) such proportion (if any) as is reasonable of the costs reasonably incurred in providing any such additional capacity in an earlier main as falls to be used in consequence of the provision of the new main.

(5) In subsection (4) above the reference to an earlier main, in relation to the new main, is a reference to any water main which—

(a) has been provided in the period of twelve years immediately before the provision of the new main; and

(b) was so provided in pursuance of a water main requisition.

(6) Any reference in this section to the provision of additional capacity in a water main provided in pursuance of a requirement under any enactment is a reference to such works carried out or other things done in connection with the provision of that main as are carried out or done for the purpose of enabling that main to be used for purposes in addition to those for which it is necessary to provide the main in order to comply with the requirement.

(7) Any reference in this section to the water charges payable for the use during any year of any main provided by a water undertaker is a reference to so much of the aggregate of any charges payable to the water undertaker in respect of services provided in the course of that year as represents charges which—

(a) have been imposed by the undertaker in relation to premises which are connected with that main; and

(b) are reasonably attributable to the provision of a supply of water (whether or not for domestic purposes) to those premises by means of that main.

(8) An approval or determination given or made by the Director for the purposes of subsection (2) above—

(a) may be given or made in relation to the provision of a particular water main, in relation to the provision of mains of a particular description or in relation to the provision of water mains generally; and

(b) may be revoked at any time except in relation to a water main that has already been provided.

(9) In this section “water main requisition” means—

(a) a requirement under section 41 above (including, by virtue of paragraph 1 of Schedule 2 to the [1991 c. 60.] Water Consolidation (Consequential Provisions) Act 1991, a requirement under section 40 of the [1989 c. 15.] Water Act 1989);

(b) a requirement under the provisions of section 36 or 37 of the [1945 c. 42.] Water Act 1945 or of section 29 of Schedule 3 to that Act (water main requisitions); or

(c) a requirement under any local statutory provision corresponding to section 41 above or to any of those provisions of that Act of 1945.

44 Determination of completion date and route for requisitioned main

(1) A water undertaker shall not be in breach of a duty imposed by section 41 above in relation to any locality unless–

(a) the period of three months beginning with the relevant day has expired; and

(b) the water undertaker has not, before the end of that period, so laid the water main to be provided as to enable service pipes to premises in that locality to connect with the main at the places determined under subsection (3) below.

(2) The period mentioned in subsection (1)(a) above may be extended in any case—

(a) by agreement between the water undertaker and the person or persons who required the provision of the main; or

(b) where there is a dispute as to whether the period should be extended, by an arbitrator on a reference under subsection (4) below.

(3) The places mentioned in subsection (1)(b) above shall be—

(a) such places as are determined by agreement between the water undertaker and the person or persons who required the provision of the water main; or

(b) in default of agreement, such places as are determined by an arbitrator, on a reference under subsection (4) below, to be the places at which it is reasonable, in all the circumstances, for service pipes to premises in the locality in question to connect with the water main.

(4) A reference for the purposes of subsection (2) or (3) above shall be to a single arbitrator appointed—

(a) by agreement between the undertaker and the person or persons who required the provision of the water main; or

(b) in default of agreement, by the President of the Institution of Civil Engineers.

(5) In this section “relevant day”, in relation to a requirement to provide a water main for any locality, means the day after whichever is the later of the following, that is to say—

(a) the day on which the conditions specified in section 42 above are satisfied in relation to the requirement; and

(b) the day on which the places where service pipes to premises in that locality will connect with the main are determined under subsection (3) above.

Domestic connections

45 Duty to make connections with main

(1) Subject to the following provisions of this section and to sections 46 and 47 below, it shall be the duty of a water undertaker (in accordance with section 51 below) to make a connection under this section where the owner or occupier of any premises in the undertaker’s area which—

(a) consist in the whole or any part of a building; or

(b) are premises on which any person is proposing to erect any building or part of a building,

serves a notice on the undertaker requiring it, for the purpose of providing a supply of water for domestic purposes to that building or part of a building, to connect a service pipe to those premises with one of the undertaker’s water mains.

(2) Where a notice has been served for the purposes of this section, the duty imposed by subsection (1) above shall be a duty, at the expense of the person serving the notice, to make the connection required by the notice if—

(a) the main with which the service pipe is required to be connected is neither a trunk main nor a water main which is or is to be used solely for the purpose of supplying water otherwise than for domestic purposes; and

(b) such conditions as the undertaker may have imposed under sections 47 to 50 below have been satisfied;

and, subject to section 51 below, that duty shall arise whether or not the service pipe to which the notice relates has been laid when the notice is served.

(3) A notice for the purposes of this section—

(a) shall be accompanied or supplemented by all such information as the undertaker may reasonably require; and

(b) if the notice has effect so that a requirement is imposed on the undertaker by virtue of section 46(4) below, shall set out the matters that have given rise to the imposition of that requirement;

but, subject to section 51(5) below and without prejudice to the effect (if any) of any other contravention of this subsection, a failure to provide information in pursuance of the obligation to supplement such a notice shall not invalidate that notice.

(4) The duty imposed on a water undertaker by this section shall be owed to the person who served the notice by virtue of which the duty arises.

(5) Where a duty is owed by virtue of subsection (4) above to any person, any breach of that duty which causes that person to sustain loss or damage shall be actionable at the suit of that person; but, in any proceedings brought against a water undertaker in pursuance of this subsection, it shall be a defence for the undertaker to show that it took all reasonable steps and exercised all due diligence to avoid the breach.

(6) Where a water undertaker carries out any works which it is its duty under this section to carry out at another person’s expense, the undertaker shall be entitled to recover from that person an amount equal to the expenses reasonably incurred by the undertaker in carrying out the works.

(7) Nothing in this section or in sections 46 to 51 below shall impose any duty on a water undertaker to connect a service pipe to any premises with a service pipe to any other premises.

(8) In the following provisions of this Chapter a notice served for the purposes of this section is referred to as a connection notice.

46 Duty to carry out ancillary works for the purpose of making domestic connection

(1) Where a water undertaker is required to make a connection in pursuance of any connection notice, it shall also be the duty of the undertaker, at the expense of the person serving the notice, to carry out such of the works to which this section applies as need to be carried out before the connection can be made.

(2) This section applies to the laying of so much of the service pipe to be connected with the water main as it is necessary, for the purpose of making that connection, to lay in a street.

(3) In a case where—

(a) the water main with which the service pipe is to be connected is situated in a street;

(b) the premises consisting in the building or part of a building in question together with any land occupied with it abut on the part of the street where the main is situated; and

(c) the service pipe to those premises will—

(i) enter the premises otherwise than through an outer wall of a building abutting on the street; and

(ii) have a stopcock fitted to it by the undertaker in the premises,

this section applies to the laying of so much of the service pipe as it is necessary, for the purpose of making the required connection, to lay in land between the boundary of the street and that stopcock.

(4) In a case where the connection notice is served in compliance with a requirement imposed by a notice by a local authority under section 80 below, this section applies to the laying of so much of the service pipe to be connected with a water main in pursuance of the connection notice as it is necessary, for the purpose of making the connection, to lay in land owned or occupied by a person who is certified by that authority—

(a) to have unreasonably refused his consent to the laying of the service pipe; or

(b) to have sought to make the giving of his consent subject to unreasonable conditions.

(5) Where a water main is alongside a street and within eighteen metres of the middle of that street, subsections (2) to (4) above shall have effect in relation to the laying, for the purpose of making a connection with that main, of a service pipe to any premises as if the street included so much of the land between the main and the boundary of the street as is not comprised in those premises or in any land occupied with those premises.

(6) It shall be the duty of any water undertaker making a connection in pursuance of a connection notice to ensure that a stopcock belonging to the undertaker is fitted to the service pipe which is connected.

(7) Subsections (4) to (6) of section 45 above shall have effect–

(a) in relation to any duties which, by virtue of a connection notice, are imposed on a water undertaker by this section; and

(b) in relation to any works which, by virtue of the service of such a notice, such an undertaker carries out under this section at another person’s expense,

as they have effect by virtue of that notice in relation to the duty which arises under that section or, as the case may be, to works which the undertaker carries out under that section at another person’s expense.

(8) Subject to subsection (9) below, a water undertaker may comply with any duty under this section to lay a service pipe by laying a water main instead; but nothing in section 45 above or this section shall impose any duty on a water undertaker to lay a water main where it has no power to lay a service pipe.

(9) Where a water undertaker exercises its power under subsection (8) above to lay a water main instead of a service pipe—

(a) paragraph (a) of section 51(1) below shall have effect as if any additional time reasonably required by reason of the laying of the main instead of the service pipe were included in the time allowed by that paragraph for the laying of the service pipe; but

(b) the expenses recoverable by virtue of section 45(6) and subsection (7) above shall not exceed such amount as it would have been reasonable for the undertaker to have incurred in laying a service pipe instead of the main.

47 Conditions of connection with water main

(1) Subject to subsection (3) and sections 48 to 50 below, where the owner or occupier of any premises (“the relevant premises”) serves a connection notice on a water undertaker, the undertaker may make compliance with one or more of the requirements specified in subsection (2) below a condition of its complying with the duties to which it is subject by virtue of that notice.

(2) The requirements mentioned in subsection (1) above are—

(a) a requirement that such security as the undertaker may reasonably require has been provided for the discharge of any obligations imposed by virtue of section 45(6) or 46(7)(b) above on the person who served the connection notice;

(b) a requirement, in a case where the connection required by the connection notice is necessary as a consequence of a disconnection made by reason of any person’s failure to pay any charges, that the person serving the connection notice has paid any amount owed by him to the undertaker—

(i) in respect of a supply of water to the relevant premises; or

(ii) in respect of expenses incurred in the making of the disconnection;

(c) a requirement that a meter for use in determining the amount of any charges which have been or may be fixed in relation to the relevant premises by reference to volume has been installed and connected either—

(i) by the undertaker; or

(ii) in accordance with specifications approved by the undertaker;

(d) a requirement that—

(i) so much of the service pipe to the relevant premises as does not belong to, or fall to be laid by, the undertaker; and

(ii) the plumbing of the premises,

comply with specifications approved by the undertaker for the purpose of ensuring that it will be reasonably practicable for such a meter as is mentioned in paragraph (c) above to be installed and connected as so mentioned;

(e) a requirement that a separate service pipe has been provided—

(i) to each house or building on the relevant premises; or

(ii) where different parts of a building on the relevant premises are separately occupied, to each of those parts or to any of them;

(f) a requirement, in relation to the relevant premises—

(i) that such a requirement as may be imposed under section 66 below has been complied with; or

(ii) in a case where such a requirement could be imposed but for there already being such a cistern as is mentioned in that section, that the cistern and its float-operated valve are in good repair;

(g) a requirement that there is no contravention in relation to the water fittings used or to be used in connection with—

(i) the supply of water to the relevant premises; or

(ii) the use of water in those premises,

of such of the requirements of regulations under section 74 below as are prescribed for the purposes of this paragraph; and

(h) a requirement that every such step has been taken as has been specified in any notice served on any person under section 75 below in relation to the relevant premises.

(3) A condition shall not be imposed by a water undertaker under this section on a person who has served a connection notice except by a counter-notice served on that person before the end of the period of fourteen days beginning with the day after the service of the connection notice.

(4) This section shall be without prejudice to the provisions of sections 233 and 372 of the [1986 c. 45.] Insolvency Act 1986 (conditions of supply after insolvency).

48 Interest on sums deposited in pursuance of the deposit condition

(1) Where for the purposes of subsection (2)(a) of section 47 above any sums have been deposited with a water undertaker by way of security for the discharge of any obligation, the undertaker shall pay interest at such rate as may be determined either—

(a) by the undertaker with the approval of the Director; or

(b) in default of a determination under paragraph (a) above, by the Director,

on every sum of 50p so deposited for every three months during which it remains in the hands of the undertaker.

(2) An approval or determination by the Director for the purposes of this section—

(a) may be given or made in relation to a particular case or description of cases or generally; and

(b) may be revoked at any time.

49 Supplemental provisions with respect to the metering conditions

(1) The power conferred on a water undertaker to impose conditions under section 47 above for the purposes of metering—

(a) shall be exercisable in relation to any premises even if the undertaker has no immediate intention, when the power is exercised, of fixing charges in relation to those premises by reference to volume; but

(b) shall not be exercisable so as to require the alteration or removal of any pipe laid or plumbing installed before 1st April 1989.

(2) Specifications approved by any water undertaker for the purposes of subsection (2)(c) or (d) of section 47 above may be approved—

(a) in relation to particular premises; or

(b) by being published in such manner as the undertaker considers appropriate, in relation to premises generally or to any description of premises.

(3) Any dispute between a water undertaker and any other person as to the terms of any condition imposed under section 47 above for the purposes of metering shall be referred to the arbitration of a single arbitrator appointed—

(a) by agreement between the undertaker and that person; or

(b) in default of agreement, by the Secretary of State.

(4) References in this section to the imposition of a condition under section 47 above for the purposes of metering are references to the imposition of conditions by virtue of subsection (2)(c) or (d) of that section.

50 Restriction on imposition of condition requiring separate service pipes

(1) This section applies where the effect of a connection notice served in respect of any house is to require a service pipe to that house to be connected with a water main with which it has previously been connected.

(2) Where this section applies, the water undertaker on which the connection notice is served shall not be entitled to make the reconnection subject to any such condition as, apart from this section, may be imposed by virtue of section 47(2)(e) above unless the undertaker would have been entitled under section 64 below to require the provision of a separate service pipe if the reconnection had already been made.

51 Time for performance of connection etc. duties

(1) A water undertaker shall not be in breach of a duty imposed by virtue of the service of a connection notice unless—

(a) in the case of a duty to lay any service pipe or to connect any service pipe to which such a duty relates, it has failed to lay that pipe or to make that connection as soon as reasonably practicable after the relevant day;

(b) in the case of a duty to connect a service pipe the whole of which has already been laid when the notice is served on the undertaker, it has failed to make the connection before the end of the period of fourteen days beginning with the relevant day.

(2) In any case in which a water undertaker is subject to any such duty as is mentioned in subsection (1)(a) above, it shall be presumed, unless the contrary is shown in relation to that case, that the period of twenty-one days beginning with the relevant day is the period within which it is reasonably practicable for a water undertaker—

(a) to lay so much of any service pipe; and

(b) to fit such stopcock,

as it is necessary to lay or fit in that case for connecting a water main in a street with a service pipe at the boundary of any premises which abut on the part of the street where the main is situated.

(3) Where—

(a) a connection notice is served in respect of any premises; and

(b) at the time when the notice is served, the customer’s part of the service pipe to those premises has not been laid,

the duties of the undertaker under sections 45 and 46 above shall not arise by virtue of that notice until the person serving the notice, having obtained the necessary consents from the owners and occupiers of any affected land, has, at his own expense, laid so much of the service pipe as it is necessary, for the purpose of making the connection, to lay otherwise than in a street or in land mentioned in subsections (3) to (5) of section 46 above.

(4) In subsection (3) above the reference to the customer’s part of the service pipe to any premises is a reference to so much of the service pipe to those premises as falls to be laid otherwise than by the water undertaker in pursuance of section 46 above.

(5) Where—

(a) a person who has served a connection notice on a water undertaker has failed to comply with his obligation under section 45(3)(a) above to supplement that notice with information required by the undertaker; and

(b) that requirement was made by the undertaker at such a time before the end of the period within which the undertaker is required to comply with the duties imposed by virtue of the notice as gave that person a reasonable opportunity to provide the required information within that period,

the undertaker may delay its compliance with those duties until a reasonable time after the required information is provided.

(6) In this section “the relevant day”, in relation to a duty imposed on a water undertaker by virtue of a connection notice, means the day after whichever is the latest of the following days, that is to say–

(a) the day on which the notice was served on the undertaker;

(b) in a case where it is necessary for the person serving the notice to lay any service pipe after serving the notice, the day on which a notice stating that the pipe has been laid is served on the undertaker;

(c) the day on which all such conditions are satisfied as the undertaker has, under sections 47 to 50 above, made conditions of its compliance with that duty.

Domestic supplies

52 The domestic supply duty

(1) The domestic supply duty of a water undertaker in relation to any premises is a duty, until there is an interruption of that duty—

(a) to provide to those premises such a supply of water as (so far as those premises are concerned) is sufficient for domestic purposes; and

(b) to maintain the connection between the undertaker’s water main and the service pipe by which that supply is provided to those premises.

(2) Subject to the following provisions of this section and to section 53 below, a water undertaker shall owe a domestic supply duty in relation to any premises to which this section applies and which are situated in the area of the undertaker if—

(a) a demand for a supply of water for domestic purposes has been made, in accordance with subsection (5) below, to the undertaker in respect of those premises; or

(b) those premises are premises to which this section applies by reason of a supply of water provided before 1st September 1989,

and there has been no interruption of the domestic supply duty in relation to those premises since that demand was made or, as the case may be, since the beginning of 1st September 1989.

(3) This section applies to any premises if—

(a) they consist in the whole or any part of a building and are connected by means of a service pipe to a water main; and

(b) the requirements of subsection (4) below are satisfied in relation to those premises.

(4) The requirements of this subsection are satisfied in relation to any premises if—

(a) the pipe by means of which the premises are connected to the water main in question was first connected with that main in pursuance of a connection notice served in respect of those premises;

(b) that pipe was the means by which a supply of water from that main was being supplied to those premises for domestic purposes immediately before 1st September 1989;

(c) the condition specified in paragraph (b) above would be satisfied in relation to the premises if any service pipe to those premises had not been temporarily disconnected for the purposes of any necessary works which were being carried out immediately before 1st September 1989; or

(d) the condition specified in any of the preceding paragraphs—

(i) has been satisfied in relation to the premises at any time on or after 1st September 1989; and

(ii) would continue to be satisfied in relation to the premises had not the whole or any part of a service pipe to those premises, or the main with which such a pipe had been connected, been renewed (on one or more previous occasions).

(5) For the purposes of this section a demand in respect of any premises is made in accordance with this subsection if it is made—

(a) by the person who is the occupier of the premises at the time when the demand is made; or

(b) by a person who is the owner of the premises at that time and agrees with the undertaker to pay all the undertaker’s charges in respect of the supply demanded.

(6) For the purposes of this section—

(a) there is an interruption of the domestic supply duty owed by a water undertaker in relation to any premises if that supply is cut off by anything done by the undertaker in exercise of any of its disconnection powers, other than a disconnection or cutting off for the purposes of the carrying out of any necessary works; and

(b) a domestic supply duty owed in relation to any premises shall not be treated as interrupted by reason only of a change of the occupier or owner of the premises.

(7) Nothing in this section shall impose any duty on a water undertaker—

(a) to provide a supply of water directly from, or maintain any connection with, a water main which is a trunk main or is or is to be used solely for the purpose of supplying water otherwise than for domestic purposes; or

(b) to provide a supply of water to any premises, or maintain the connection between a water main and a service pipe to any premises, during any period during which it is reasonable—

(i) for the supply of water to those premises to be cut off or reduced; or

(ii) for the pipe to be disconnected,

for the purposes of the carrying out of any necessary works.

(8) In this section references to the disconnection powers of a water undertaker are references to the powers conferred on the undertaker by any of sections 60 to 62 and 75 below.

53 Conditions of compliance with domestic supply duty

(1) Where a demand for the purposes of section 52(2) above has been made to a water undertaker in respect of any premises (“the relevant premises”), the undertaker may make compliance with one or more of the requirements specified in subsection (2) below a condition of providing his first supply of water in compliance with that demand.

(2) The requirements mentioned in subsection (1) above are—

(a) a requirement, in a case where the demand is made as a consequence of a supply having been cut off by reason of any person’s failure to pay any charges, that the person making the demand has paid any amount owed by him to the undertaker—

(i) in respect of a supply of water to the relevant premises; or

(ii) in respect of expenses incurred in cutting off any such supply;

(b) a requirement, in relation to the relevant premises

(i) that such a requirement as may be imposed under section 66 below has been complied with; or

(ii) in a case where such a requirement could be imposed but for there already being such a cistern as is mentioned in that section, that the cistern and its float-operated valve are in good repair;

(c) a requirement that there is no contravention in relation to the water fittings used or to be used in connection with—

(i) the supply of water to the relevant premises; or

(ii) the use of water in those premises,

of such of the requirements of regulations under section 74 below as are prescribed for the purposes of this subsection; and

(d) a requirement that every such step has been taken as has been specified in any notice served on any person under section 75 below in relation to the relevant premises.

(3) This section shall be without prejudice to the provisions of sections 233 and 372 of the [1986 c. 45.] Insolvency Act 1986 (conditions of supply after insolvency).

54 Enforcement of domestic supply duty

(1) A duty imposed on a water undertaker under section 52 above—

(a) to provide a supply of water to any premises; or

(b) to maintain a connection between a water main and a service pipe by which such a supply is provided,

shall be owed to the consumer.

(2) Where a duty is owed by virtue of this section to any person, any breach of that duty which causes that person to sustain loss or damage shall be actionable at the suit of that person; but, in any proceedings brought against a water undertaker in pursuance of this subsection, it shall be a defence for the undertaker to show that it took all reasonable steps and exercised all due diligence to avoid the breach.

Other supplies

55 Supplies for non-domestic purposes

(1) This section applies where the owner or occupier of any premises in the area of a water undertaker requests the undertaker to provide a supply of water to those premises and—

(a) the premises are premises which do not consist in the whole or any part of a building; or

(b) the requested supply is for purposes other than domestic purposes.

(2) Where this section applies, it shall be the duty of the water undertaker, in accordance with such terms and conditions as may be determined under section 56 below—

(a) to take any such steps as may be so determined in order to enable the undertaker to provide the requested supply; and

(b) having taken any such steps, to provide that supply.

(3) A water undertaker shall not be required by virtue of this section to provide a new supply to any premises, or to take any steps to enable it to provide such a supply, if the provision of that supply or the taking of those steps would—

(a) require the undertaker, in order to meet all its existing obligations to supply water for domestic or other purposes, together with its probable future obligations to supply buildings and parts of buildings with water for domestic purposes, to incur unreasonable expenditure in carrying out works; or

(b) otherwise put at risk the ability of the undertaker to meet any of the existing or probable future obligations mentioned in paragraph (a) above.

(4) A water undertaker shall not be required by virtue of this section to provide a new supply to any premises, or to take any steps to enable it to provide such a supply, if there is a contravention in relation to the water fittings used or to be used in connection with—

(a) the supply of water to those premises; or

(b) the use of water in those premises,

of such of the requirements of regulations under section 74 below as are prescribed for the purposes of this subsection.

(5) Where—

(a) a request has been made by any person to a water undertaker for the purposes of subsection (2) above; and

(b) the steps which the undertaker is required to take by virtue of that request include steps for the purpose of obtaining any necessary authority for, or agreement to, any exercise by the undertaker of any of its powers or the carrying out by the undertaker of any works,

the failure of the undertaker to acquire the necessary authority or agreement shall not affect any liability of that person, under any term or condition in accordance with which those steps are taken, to re-imburse the undertaker in respect of some or all of the expenses incurred by the undertaker in taking those steps.

(6) Nothing in this section shall impose any duty on a water undertaker to provide a supply of water to any premises during any period during which it is reasonable for the supply of water to those premises to be cut off or reduced for the purposes of the carrying out of any necessary works.

(7) The duty of a water undertaker to supply water under this section at the request of any person, and any terms and conditions determined under section 56 below in default of agreement between the undertaker and that person, shall have effect as if contained in such an agreement.

(8) Except so far as otherwise provided by the terms and conditions determined under section 56 below in relation to any supply, the duties of a water undertaker under this section shall have effect subject to the provisions of sections 60 to 63 and 75 below.

56 Determinations on requests for non-domestic supplies

(1) Subject to subsection (3) below, any terms or conditions or other matter which falls to be determined for the purposes of a request made by any person to a water undertaker for the purposes of section 55 above shall be determined—

(a) by agreement between that person and the water undertaker; or

(b) in default of agreement, by the Director according to what appears to him to be reasonable.

(2) Subject to subsection (3) below, the Director shall also determine any dispute arising between any person and a water undertaker by virtue of subsection (3) or (4) of section 55 above.

(3) The Director may, instead of himself making a determination under subsection (1) or (2) above, refer any matter submitted to him for determination under that subsection to the arbitration of such person as he may appoint.

(4) For the purposes of any determination under this section by the Director or any person appointed by him it shall be for a water undertaker to show that it should not be required to comply with a request made for the purposes of section 55 above.

(5) The charges in respect of a supply provided in compliance with any request made for the purposes of section 55 above—

(a) shall not be determined by the Director or a person appointed by him, except in so far as, at the time of the request, no provision is in force by virtue of a charges scheme under section 143 below in respect of supplies of the applicable description; and

(b) in so far they do fall to be determined, shall be so determined having regard to the desirability of the undertaker's—

(i) recovering the expenses of complying with its obligations under section 55 above; and

(ii) securing a reasonable return on its capital.

(6) To the extent that subsection (5)(a) above excludes any charges from a determination under this section, those charges shall be fixed from time to time by a charges scheme under section 143 below, but not otherwise.

(7) The determination of any matter under this section shall be without prejudice to the provisions of sections 233 and 372 of the [1986 c. 45.] Insolvency Act 1986 (conditions of supply after insolvency).

57 Duty to provide a supply of water etc. for fire-fighting

(1) It shall be the duty of a water undertaker to allow any person to take water for extinguishing fires from any of its water mains or other pipes on which a fire-hydrant is fixed.

(2) Every water undertaker shall, at the request of the fire authority concerned, fix fire-hydrants on its water mains (other than its trunk mains) at such places as may be most convenient for affording a supply of water for extinguishing any fire which may break out within the area of the undertaker.

(3) It shall be the duty of every water undertaker to keep every fire-hydrant fixed on any of its water mains or other pipes in good working order and, for that purpose, to replace any such hydrant when necessary.

(4) It shall be the duty of a water undertaker to ensure that a fire authority has been supplied by the undertaker with all such keys as the authority may require for the fire-hydrants fixed on the water mains or other pipes of the undertaker.

(5) Subject to section 58(3) below, the expenses incurred by a water undertaker in complying with its obligations under subsections (2) to (4) above shall be borne by the fire authority concerned.

(6) Nothing in this section shall require a water undertaker to do anything which it is unable to do by reason of the carrying out of any necessary works.

(7) The obligations of a water undertaker under this section shall be enforceable under section 18 above by the Secretary of State.

(8) In addition, where a water undertaker is in breach of its obligations under this section, the undertaker shall be guilty of an offence and liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum;

(b) on conviction on indictment, to a fine.

(9) In any proceedings against any water undertaker for an offence under subsection (8) above it shall be a defence for that undertaker to show that it took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

(10) In this section “fire authority” has the same meaning as in the [1947 c. 41.] Fire Services Act 1947.

58 Specially requested fire-hydrants

(1) A water undertaker shall, at the request of the owner or occupier of any factory or place of business, fix a fire-hydrant, to be used for extinguishing fires and not other purposes, at such place on any suitable water main or other pipe of the undertaker as is as near as conveniently possible to that factory or place of business.

(2) For the purposes of subsection (1) above a water main or other pipe is suitable, in relation to a factory or place of business, if—

(a) it is situated in a street which is in or near to that factory or place of business; and

(b) it is of sufficient dimensions to carry a hydrant and is not a trunk main.

(3) Subsection (5) of section 57 above shall not apply in relation to expenses incurred in compliance, in relation to a specially requested fire-hydrant, with the obligations under subsections (3) and (4) of that section.

(4) Any expenses incurred by a water undertaker—

(a) in complying with its obligations under subsection (1) above; or

(b) in complying, in relation to a specially requested fire-hydrant, with its obligations under section 57(3) or (4) above,

shall be borne by the owner or occupier of the factory or place of business in question, according to whether the person who made the original request for the hydrant did so in his capacity as owner or occupier.

(5) Subsections (6) to (9) of section 57 above shall apply in relation to the obligations of a water undertaker under this section as they apply to the obligations of a water undertaker under that section.

(6) In this section—

• “factory” has the same meaning as in the [1961 c. 34.] Factories Act 1961; and

• “specially requested fire-hydrant” means a fire-hydrant which—

  (a)

  is fixed on a water main or other pipe of a water undertaker; and

  (b)

  was fixed on that main or pipe (whether before or after it became such a main or pipe under the [1989 c. 15.] Water Act 1989) in pursuance of a request made by the owner or occupier of a factory or place of business.

59 Supplies for other public purposes

(1) A water undertaker shall, at the request of a sewerage undertaker, highway authority or local authority, provide, from such of its pipes as are of an appropriate capacity, a supply of water for cleansing sewers and drains, for cleansing and watering highways or, as the case may be, for supplying any public pumps, baths or wash-houses.

(2) A supply of water provided by a water undertaker under this section shall be provided upon such terms and conditions as may be reasonable.

(3) A water main or other pipe of a water undertaker shall be treated as of an appropriate capacity for the purposes of this section if and only if it has a fire-hydrant fixed on it.

(4) Nothing in this section shall require a water undertaker to do anything which it is unable to do by reason of the carrying out of any necessary works.

(5) The obligations of a water undertaker under this section shall be enforceable under section 18 above by the Director.

Disconnections

60 Disconnections for the carrying out of necessary works

(1) Subject to the following provisions of this section, a water undertaker may—

(a) disconnect a service pipe which, for the purposes of providing a supply of water to any premises, is connected with any water main of that undertaker; or

(b) otherwise cut off a supply of water to any premises,

if it is reasonable for the disconnection to be made, or the supply to be cut off, for the purposes of the carrying out of any necessary works.

(2) The power of a water undertaker under this section to cut off a supply of water shall include power to reduce a supply of water.

(3) Except in an emergency or in the case of a reduction which is immaterial, the power of a water undertaker under this section to cut off or reduce a supply shall be exercisable in relation to any premises only after the undertaker has served reasonable notice on the consumer of the proposal for the carrying out of the necessary works.

(4) Where a water undertaker exercises its power under this section to make any disconnection or to cut off or reduce a supply of water to any premises for the purposes of the carrying out of any necessary works, it shall owe a duty to the consumer to secure—

(a) that those works are carried out with reasonable dispatch; and

(b) that any supply of water to those premises for domestic purposes is interrupted for more than twenty-four hours for the purposes of the carrying out of those works only if an emergency supply has been made available (whether or not in pipes) within a reasonable distance of the premises.

(5) Any breach by a water undertaker of the duty owed by virtue of subsection (4) above which causes any person to whom it is owed to sustain loss or damage shall be actionable at the suit of that person.

61 Disconnections for non-payment of charges

(1) Subject to the following provisions of this section, a water undertaker may disconnect a service pipe which for the purposes of providing a supply of water to any premises is connected with any water main of that undertaker, or may otherwise cut off a supply of water to any premises, if the occupier of the premises—

(a) is liable (whether in his capacity as occupier or under any agreement with the undertaker) to pay charges due to the undertaker in respect of the supply of water to those premises; and

(b) has failed to do so before the end of the period of seven days beginning with the day after he is served with notice requiring him to do so.

(2) Where—

(a) a water undertaker has served a notice for the purposes of paragraph (b) of subsection (1) above on a person; and

(b) within the period of seven days mentioned in that paragraph, that person serves a counter-notice on the undertaker stating that he disputes his liability to pay the charges in question,

the undertaker shall not in respect of that notice exercise his power by virtue of that subsection in relation to any premises except at a time when that person is the occupier of the premises and those charges are enforceable against that person in a manner specified in subsection (3) below.

(3) For the purposes of subsection (2) above charges are enforceable in a manner specified in this subsection against a person if–

(a) the undertaker is able to enforce a judgment against that person for the payment of the charges; or

(b) that person is in breach of an agreement entered into, since the service of his counter-notice, for the purpose of avoiding or settling proceedings by the undertaker for the recovery of the charges.

(4) A water undertaker which exercises its power under this section to disconnect any pipe or otherwise to cut off any supply of water may recover, from the person in respect of whose liability the power is exercised, any expenses reasonably incurred by the undertaker in making the disconnection or in otherwise cutting off the supply.

(5) Where—

(a) a water undertaker has power under this section to disconnect any pipe to any premises, or otherwise to cut off any supply to any premises; and

(b) a supply of water is provided to those premises and to other premises wholly or partly by the same service pipe,

the undertaker may exercise that power so as to cut off the supply to those other premises if and only if the same person is the occupier of the premises in relation to which the charges are due and of the other premises.

62 Disconnections at request of customer

(1) Subject to the following provisions of this section, a water undertaker may—

(a) disconnect a service pipe which for the purposes of providing a supply of water to any premises is connected with any water main of that undertaker; or

(b) otherwise cut off a supply of water to any premises,

if notice specifying the time after which a supply of water to those premises will no longer be required has been served on the undertaker by a consumer and that time has passed.

(2) No person shall be liable to a water undertaker for any expenses incurred by the undertaker in exercising the power conferred on the undertaker by this section.

63 General duties of undertakers with respect to disconnections

(1) Where a water undertaker—

(a) disconnects a service pipe to any inhabited house, or otherwise cuts off a supply of water to such a house; and

(b) does so without restoring the supply to that house before the end of the period of twenty-four hours beginning with the time when it is cut off,

the undertaker shall, no later than forty-eight hours after that time, serve notice that it has cut off that supply on the local authority in whose area the house is situated.

(2) A water undertaker which fails, without reasonable excuse, to serve a notice on a local authority as required by subsection (1) above shall be guilty of an offence under this section.

(3) A water undertaker shall be guilty of an offence under this section if—

(a) it disconnects a service pipe to any premises, or otherwise cuts off a supply of water to any premises, in a case in which it has no power to do so under sections 60 to 62 above, section 75 below or any other enactment; or

(b) in disconnecting any such pipe or cutting off any such supply it fails, without reasonable excuse, to comply with any requirement of the provisions in pursuance of which it disconnects the pipe or cuts off the supply.

(4) A water undertaker which is guilty of an offence under this section shall be liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

Means of supply

64 Supply by means of separate service pipes

(1) Subject to the following provisions of this section, a water undertaker may require the provision of a separate service pipe to any premises within its area which—

(a) consist in a house or any other building or part of a building, being, in the case of a part of a building, a part which is separately occupied; and

(b) are already supplied with water by the undertaker but do not have a separate service pipe.

(2) Where the supply of water to two or more houses was provided to those houses before 15th April 1981 wholly or partly by the same service pipe and continues to be so provided, the water undertaker shall not require the provision of separate service pipes to those houses until—

(a) the service pipe, in so far as it belongs to a person other than the undertaker, becomes so defective as to require renewal or is no longer sufficient to meet the requirements of those houses;

(b) a payment in respect of the supply of water to any of those houses remains unpaid after the end of the period for which it is due;

(c) the houses are, by structural alterations to one or more of them, converted into a larger number of houses;

(d) the owner or occupier of any of those houses has interfered with, or allowed another person to interfere with, the existing service pipe and thereby caused the supply of water to any house to be interfered with; or

(e) the undertaker has reasonable grounds for believing that such interference as is mentioned in paragraph (d) above is likely to take place.

(3) If, in the case of any such premises as are described in subsection (1) above, the water undertaker which provides a supply of water to those premises serves notice on the consumer requiring the provision of a separate service pipe and setting out the power of the undertaker under subsection (4) below—

(a) that consumer shall, within three months after the service of the notice, lay so much of the required pipe as the undertaker is not under a duty to lay by virtue of paragraph (b) below;

(b) sections 45 to 51 above shall apply as if that consumer had by a connection notice required the undertaker to connect the separate service pipe to those premises with the undertaker’s water main;

(c) that consumer shall be presumed, without prejudice to his power to make further demands and requests—

(i) in so far as those premises were provided before the service of the notice with a supply of water for domestic purposes, to have made a demand for the purposes of section 52 above that such a supply is provided by means of the separate service pipe; and

(ii) in so far as those premises were provided before the service of the notice with a supply of water for other purposes, to have requested the undertaker to provide the same supply by means of that pipe as was provided before the service of the notice;

and

(d) on providing a supply of water to those premises by means of the separate service pipe, the undertaker may cut off any supply replaced by that supply and may make such disconnections of pipes by which the replaced supply was provided as it thinks fit.

(4) If a person upon whom a notice has been served for the purposes of subsection (3) above fails to comply with the notice, the water undertaker may—

(a) itself carry out the works which that person was required to carry out; and

(b) recover the expenses reasonably incurred by the undertaker in doing so from that person.

(5) Without prejudice—

(a) to the power of a water undertaker by virtue of paragraph (b) of subsection (3) above to impose conditions under section 47 above; or

(b) to the power conferred by virtue of paragraph (d) of that subsection,

any works carried out by a water undertaker by virtue of the provisions of the said paragraph (b) or of subsection (4) above shall be necessary works for the purposes of this Chapter.

65 Duties of undertakers as respects constancy and pressure

(1) Subject to the following provisions of this section, it shall be the duty of a water undertaker to cause the water in such of its water mains and other pipes as—

(a) are used for providing supplies of water for domestic purposes; or

(b) have fire-hydrants fixed on them,

to be laid on constantly and at such a pressure as will cause the water to reach to the top of the top-most storey of every building within the undertaker’s area.

(2) Nothing in subsection (1) above shall require a water undertaker to provide a supply of water at a height greater than that to which it will flow by gravitation through its water mains from the service reservoir or tank from which that supply is taken.

(3) For the purposes of this section a water undertaker shall be entitled to choose the service reservoir or tank from which any supply is to be taken.

(4) Nothing in subsection (1) above shall impose any duty on a water undertaker to maintain the constancy or pressure of any supply of water during any period during which it is reasonable for that supply to be cut off or reduced for the purposes of the carrying out of any necessary works.

(5) The Secretary of State may by order modify the application of the preceding provisions of this section in relation to any water undertaker.

(6) The Secretary of State shall not make an order under subsection (5) above except—

(a) in accordance with Schedule 5 to this Act; and

(b) on an application made in accordance with that Schedule by the Director or by the water undertaker in relation to which the order is made.

(7) Subject to subsection (6) above, the power of the Secretary of State to make an order under subsection (5) above shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament

(8) An order under subsection (5) above may—

(a) require the payment of compensation by a water undertaker to persons affected by the order;

(b) make different provision for different cases, including different provision in relation to different persons, circumstances or localities; and

(c) contain such supplemental, consequential and transitional provision as the Secretary of State considers appropriate.

(9) The obligations of a water undertaker under this section shall be enforceable under section 18 above by the Secretary of State.

(10) In addition, where a water undertaker is in breach of a duty under this section, the undertaker shall be guilty of an offence and liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum;

(b) on conviction on indictment, to a fine.

(11) In any proceedings against any water undertaker for an offence under subsection (10) above it shall be a defence for that undertaker to show that it took all reasonable steps and exercised all due diligence to avoid the commission of the offence.

66 Requirements by undertaker for maintaining pressure

(1) A water undertaker may require that any premises consisting in—

(a) any building or part of a building the supply of water to which need not, in accordance with provision contained in or made under this Act, be constantly laid on under pressure; or

(b) any relevant house to which water is required to be delivered at a height greater than a point 10.5 metres below the draw-off level of the service reservoir or tank from which a supply of water is being provided by the undertaker to those premises,

shall be provided with a cistern which has a float-operated valve and is fitted on the pipe by means of which water is supplied to those premises.

(2) A water undertaker may, in the case of such a house as is mentioned in paragraph (b) of subsection (1) above, require that a cistern the provision of which is required under that subsection shall be capable of holding sufficient water to provide an adequate supply to the house for a period of twenty-four hours.

(3) If, where a water undertaker provides a supply of water to any premises, the consumer, after having been required to do so by notice served on him by the undertaker, fails before the end of the period specified in the notice—

(a) to provide a cistern in accordance with a requirement under this section; or

(b) to put any such cistern and its float-operated valve into good repair,

the water undertaker may itself provide a cistern, or carry out any repairs necessary to prevent waste of water.

(4) The period specified for the purposes of subsection (3) above in a notice under this section shall be a period of not less than twenty-eight days beginning with the day after the service of the notice.

(5) Where a water undertaker provides a cistern or carries out any repairs under subsection (3) above, it may recover the expenses reasonably incurred by it in doing so from the owner of the premises in question.

(6) In this section—

• “pre-transfer supplier”, in relation to a house, means the person who was supplying water to that house immediately before 1st September 1989; and

• “relevant house” means any house other than a house in relation to which the following two conditions are satisfied, that is to say—

  (i)

  the erection of the house was commenced before 1st September 1989; and

  (ii)

  no such requirement as is mentioned in subsection (1) or (2) above could have been imposed in relation to the house under any enactment having effect immediately before that date in relation to the pre-transfer supplier.

Chapter III Quality and Sufficiency of Supplies

Standards of wholesomeness

67 Standards of wholesomeness

(1) The Secretary of State may by regulations make provision that water that is supplied to any premises is or is not to be regarded as wholesome for the purposes of this Chapter if it satisfies or, as the case may be, fails to satisfy such requirements as may be prescribed.

(2) Without prejudice to the generality of subsection (1) above, regulations under this section may, for the purpose of determining the wholesomeness of any water—

(a) prescribe general requirements as to the purposes for which the water is to be suitable;

(b) prescribe specific requirements as to the substances that are to be present in or absent from the water and as to the concentrations of substances which are or are required to be present in the water;

(c) prescribe specific requirements as to other characteristics of the water;

(d) provide that the question whether prescribed requirements are satisfied may be determined by reference to such samples as may be prescribed;

(e) enable the Secretary of State to authorise such relaxations of and departures from the prescribed requirements (or from any of them) as may be prescribed, to make any such authorisation subject to such conditions as may be prescribed and to modify or revoke any such authorisation or condition; and

(f) enable the Secretary of State to authorise a local authority (either instead of the Secretary of State or concurrently with him) to exercise in relation to a private supply any power conferred on the Secretary of State by regulations made by virtue of paragraph (e) above.

General obligations of undertakers

68 Duties of water undertakers with respect to water quality

(1) It shall be the duty of a water undertaker—

(a) when supplying water to any premises for domestic or food production purposes to supply only water which is wholesome at the time of supply; and

(b) so far as reasonably practicable, to ensure, in relation to each source or combination of sources from which that undertaker supplies water to premises for domestic or food production purposes, that there is, in general, no deterioration in the quality of the water which is supplied from time to time from that source or combination of sources.

(2) For the purposes of this section and section 69 below and subject to subsection (3) below, water supplied by a water undertaker to any premises shall not be regarded as unwholesome at the time of supply where it has ceased to be wholesome only after leaving the undertaker’s pipes.

(3) For the purposes of this section where water supplied by a water undertaker to any premises would not otherwise be regarded as unwholesome at the time of supply, that water shall be regarded as unwholesome at that time if—

(a) it has ceased to be wholesome after leaving the undertaker’s pipes but while in a pipe which is subject to water pressure from a water main or which would be so subject but for the closing of some valve; and

(b) it has so ceased in consequence of the failure of the undertaker, before supplying the water, to take such steps as may be prescribed for the purpose of securing the elimination, or reduction to a minimum, of any prescribed risk that the water would cease to be wholesome after leaving the undertaker’s pipes.

(4) The provisions of this section shall apply in relation to water which is supplied by a water undertaker whether or not the water is water which the undertaker is required to supply by virtue of any provision of this Act.

(5) The duties of a water undertaker under this section shall be enforceable under section 18 above by the Secretary of State.

69 Regulations for preserving water quality

(1) The Secretary of State may by regulations require a water undertaker to take all such steps as may be prescribed for the purpose of securing compliance with section 68 above.

(2) Without prejudice to the generality of the power conferred by subsection (1) above, regulations under that subsection may impose an obligation on a water undertaker—

(a) to take all such steps as may be prescribed for monitoring and recording whether the water which that undertaker supplies to premises for domestic or food production purposes is wholesome at the time of supply;

(b) to take all such steps as may be prescribed for monitoring and recording the quality of the water from any source, or combination of sources, which that undertaker uses or is proposing to use for supplying water to any premises for domestic or food production purposes;

(c) to ensure that a source which that undertaker is using or proposing to use for supplying water for domestic or food production purposes is not so used until prescribed requirements for establishing the quality of water which may be supplied from that source have been complied with;

(d) to keep records of the localities within which all the premises supplied with water for domestic or food production purposes by that undertaker are normally supplied from the same source or combination of sources;

(e) to comply with prescribed requirements with respect to the analysis of water samples or with respect to internal reporting or organisational arrangements.

(3) Without prejudice to subsections (1) and (2) above, the Secretary of State may by regulations make provision with respect to the use by water undertakers, for the purposes of or in connection with the carrying out of their functions—

(a) of such processes and substances; and

(b) of products that contain or are made with such substances or materials,

as he considers might affect the quality of any water.

(4) Without prejudice to the generality of the power conferrred by subsection (3) above, regulations under that subsection may—

(a) forbid the use by water undertakers of processes, substances and products which have not been approved under the regulations or which contravene the regulations;

(b) for the purposes of provision made by virtue of paragraph (a) above, require processes, substances and products used by water undertakers to conform to such standards as may be prescribed by or approved under the regulations;

(c) impose such other requirements as may be prescribed with respect to the use by water undertakers of prescribed processes, substances and products;

(d) provide for the giving, refusal and revocation, by prescribed persons, of approvals required for the purposes of the regulations, for such approvals to be capable of being made subject to such conditions as may be prescribed and for the modification and revocation of any such condition;

(e) impose obligations to furnish prescribed persons with information reasonably required by those persons for the purpose of carrying out functions under the regulations;

(f) provide for a contravention of the regulations to constitute—

(i) a summary offence punishable, on summary conviction, by a fine not exceeding level 5 on the standard scale or such smaller sum as may be prescribed; or

(ii) an offence triable either way and punishable, on summary conviction, by a fine not exceeding the statutory maximum and, on conviction on indictment, by a fine;

and

(g) require prescribed charges to be paid to persons carrying out functions under the regulations.

(5) The Secretary of State may by regulations require a water undertaker—

(a) to publish information about the quality of water supplied for domestic or food production purposes to any premises by that undertaker; and

(b) to provide information to prescribed persons about the quality of water so supplied.

(6) Regulations under subsection (5) above—

(a) shall prescribe both the information which is to be published or provided in pursuance of the regulations and the manner and circumstances in which it is to be published or provided;

(b) may require the provision of information by a water undertaker to any person to be free of charge or may authorise it to be subject to the payment by that person to the undertaker of a prescribed charge; and

(c) may impose such other conditions on the provision of information by a water undertaker to any person as may be prescribed.

70 Offence of supplying water unfit for human consumption

(1) Subject to subsection (3) below, where a water undertaker supplies water by means of pipes to any premises and that water is unfit for human consumption, the undertaker shall be guilty of an offence and liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum;

(b) on conviction on indictment, to a fine.

(2) For the purposes of section 210 below and any other enactment under which an individual is guilty of an offence by virtue of subsection (1) above the penalty on conviction on indictment of an offence under this section shall be deemed to include imprisonment (in addition to or instead of a fine) for a term not exceeding two years.

(3) In any proceedings against any water undertaker for an offence under this section it shall be a defence for that undertaker to show that it—

(a) had no reasonable grounds for suspecting that the water would be used for human consumption; or

(b) took all reasonable steps and exercised all due diligence for securing that the water was fit for human consumption on leaving its pipes or was not used for human consumption.

(4) Proceedings for an offence under this section shall not be instituted except by the Secretary of State or the Director of Public Prosecutions.

Waste, contamination, misuse etc.

71 Waste from water sources

(1) Subject to subsections (2) and (3) below, a person shall be guilty of an offence under this section if—

(a) he causes or allows any underground water to run to waste from any well, borehole or other work; or

(b) he abstracts from any well, borehole or other work water in excess of his reasonable requirements.

(2) A person shall not be guilty of an offence by virtue of subsection (1)(a) above in respect of anything done for the purpose—

(a) of testing the extent or quality of the supply; or

(b) of cleaning, sterilising, examining or repairing the well, borehole or other work in question.

(3) Where underground water interferes or threatens to interfere with the carrying out or operation of any underground works (whether waterworks or not), it shall not be an offence under this section, if no other method of disposing of the water is reasonably practicable, to cause or allow the water to run to waste so far as may be necessary for enabling the works to be carried out or operated.

(4) A person who is guilty of an offence under this section shall be liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

(5) On the conviction of a person under this section, the court may—

(a) order that the well, borehole or other work to which the offence relates shall be effectively sealed; or

(b) make such other order as appears to the court to be necessary to prevent waste of water.

(6) If any person fails to comply with an order under subsection (5) above, then, without prejudice to any penalty for contempt of court, the court may, on the application of the NRA, authorise the NRA to take such steps as may be necessary to execute the order; and any expenses incurred in taking any such steps shall be recoverable summarily as a civil debt from the person convicted.

(7) Any person designated for the purpose by the NRA shall, on producing some duly authenticated document showing his authority, have a right at all reasonable times—

(a) to enter any premises for the purpose of ascertaining whether there is, or has been, any contravention of the provisions of this section on or in connection with the premises;

(b) to enter any premises for the purpose of executing any order of the court under this section which the NRA has been authorised to execute in those premises.

(8) Part I of Schedule 6 to this Act shall apply to the rights of entry conferred by subsection (7) above.

72 Contamination of water sources

(1) Subject to subsections (2) and (3) below, a person is guilty of an offence under this section if he is guilty of any act or neglect whereby the water in any waterworks which is used or likely to be used—

(a) for human consumption or domestic purposes; or

(b) for manufacturing food or drink for human consumption,

is polluted or likely to be polluted.

(2) Nothing in this section shall be construed as restricting or prohibiting any method of cultivation of land which is in accordance with the principles of good husbandry.

(3) Nothing in this section shall be construed as restricting or prohibiting the reasonable use of oil or tar on any highway maintainable at public expense so long as the highway authority take all reasonable steps for preventing—

(a) the oil or tar; and

(b) any liquid or matter resulting from the use of the oil or tar,

from polluting the water in any waterworks.

(4) A person who is guilty of an offence under this section shall be liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum and, in the case of a continuing offence, to a further fine not exceeding £50 for every day during which the offence is continued after conviction;

(b) on conviction on indictment, to imprisonment for a term not exceeding two years or to a fine or to both.

(5) In this section “waterworks” includes—

(a) any spring, well, adit, borehole, service reservoir or tank; and

(b) any main or other pipe or conduit of a water undertaker.

73 Offences of contaminating, wasting and misusing water etc

(1) If any person who is the owner or occupier of any premises to which a supply of water is provided by a water undertaker intentionally or negligently causes or suffers any water fitting for which he is responsible to be or remain so out of order, so in need of repair or so constructed or adapted, or to be so used—

(a) that water in a water main or other pipe of a water undertaker, or in a pipe connected with such a water main or pipe, is or is likely to be contaminated by the return of any substance from those premises to that main or pipe;

(b) that water that has been supplied by the undertaker to those premises is or is likely to be contaminated before it is used; or

(c) that water so supplied is or is likely to be wasted or, having regard to the purposes for which it is supplied, misused or unduly consumed,

that person shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

(2) Any person who uses any water supplied to any premises by a water undertaker for a purpose other than one for which it is supplied to those premises shall, unless the other purpose is the extinguishment of a fire, be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

(3) Where a person has committed an offence under subsection (2) above, the water undertaker in question shall be entitled to recover from that person such amount as may be reasonable in respect of any water wasted, misused or improperly consumed in consequence of the commission of the offence.

(4) For the purposes of this section the owner or occupier of any premises shall be regarded as responsible for every water fitting on the premises which is not a water fitting which a person other than the owner or, as the case may be, occupier is liable to maintain.

74 Regulations for preventing contamination, waste etc. and with respect to water fittings

(1) The Secretary of State may by regulations make such provision as he considers appropriate for any of the following purposes, that is to say—

(a) for securing—

(i) that water in a water main or other pipe of a water undertaker is not contaminated; and

(ii) that its quality and suitability for particular purposes is not prejudiced,

by the return of any substance from any premises to that main or pipe;

(b) for securing that water which is in any pipe connected with any such main or other pipe or which has been supplied to any premises by a water undertaker is not contaminated, and that its quality and suitability for particular purposes is not prejudiced, before it is used;

(c) for preventing the waste, undue consumption and misuse of any water at any time after it has left the pipes of a water undertaker for the purpose of being supplied by that undertaker to any premises; and

(d) for securing that water fittings installed and used by persons to whom water is or is to be supplied by a water undertaker are safe and do not cause or contribute to the erroneous measurement of any water or the reverberation of any pipes.

(2) Without prejudice to the generality of subsection (1) above, regulations under this section may, for any of the purposes specified in that subsection, make provision in relation to such water fittings as may be prescribed—

(a) for forbidding the installation, connection or use of the fittings if they have not been approved under the regulations or if they contravene the regulations;

(b) for requiring the fittings, for the purposes of provision made by virtue of paragraph (a) above, to be of such a size, nature, strength or workmanship, to be made of such materials or in such a manner or to conform to such standards as may be prescribed by or approved under the regulations;

(c) for imposing such other requirements as may be prescribed with respect to the installation, arrangement, connection, testing, disconnection, alteration and repair of the fittings and with respect to the materials used in their manufacture;

(d) for the giving, refusal and revocation, by prescribed persons, of approvals required for the purposes of the regulations; and

(e) for such approvals to be capable of being made subject to such conditions as may be prescribed and for the modification and revocation of any such condition.

(3) Without prejudice as aforesaid, regulations under this section may—

(a) impose separate or concurrent duties with respect to the enforcement of the regulations on water undertakers, local authorities and such other persons as may be prescribed;

(b) confer powers on a water undertaker or local authority to carry out works and take other steps, in prescribed circumstances, for remedying any contravention of the regulations;

(c) provide for the recovery by a water undertaker or local authority of expenses reasonably incurred by the undertaker or authority in the exercise of any power conferred by virtue of paragraph (b) above;

(d) repeal or modify the provisions of section 73 above or section 75 below;

(e) provide for a contravention of the regulations to constitute a summary offence punishable, on summary conviction, by a fine not exceeding level 5 on the standard scale or such smaller sum as may be prescribed;

(f) require prescribed charges to be paid to persons carrying out functions under the regulations;

(g) enable the Secretary of State to authorise such relaxations of and departures from such of the requirements of the regulations as may be prescribed, to make any such authorisation subject to such conditions as may be prescribed and to modify or revoke any such authorisation or condition;

(h) enable the Secretary of State to authorise a water undertaker or local authority (either instead of the Secretary of State or concurrently with him) to exercise any power conferred on the Secretary of State by regulations made by virtue of paragraph (g) above; and

(i) require disputes arising under the regulations to be referred to arbitration and for determinations under the regulations to be subject to such rights of appeal as may be prescribed.

(4) Without prejudice to sections 84 and 170 below, any person designated in writing for the purposes of this subsection in such manner as may be prescribed may—

(a) enter any premises for the purpose of—

(i) ascertaining whether any provision contained in or made or having effect under this Act with respect to any water fittings or with respect to the waste or misuse of water is being or has been contravened;

(ii) determining whether, and if so in what manner, any power or duty conferred or imposed on any person by regulations under this section should be exercised or performed; or

(iii) exercising any such power or performing any such duty;

or

(b) carry out such inspections, measurements and tests on premises entered by that person or on water fittings or other articles found on any such premises, and take away such samples of water or of any land and such water fittings and other articles, as that person has been authorised to carry out or take away in accordance with regulations under this section.

(5) Part II of Schedule 6 to this Act shall apply to the rights and powers conferred by subsection (4) above.

(6) The power of the Secretary of State under this section to make regulations with respect to the matters specified in the preceding provisions of this section shall include power, by regulations under this section—

(a) to modify the operation of Schedule 2 to the [1991 c. 60.] Water Consolidation (Consequential Provisions) Act 1991 in relation to any byelaws made under section 17 of the [1945 c. 42.] Water Act 1945 which have effect by virtue of paragraph 19 of Schedule 26 to the [1989 c. 15.] Water Act 1989 and that Schedule 2; and

(b) to revoke or amend any such byelaws;

but, so long as any such byelaws so have effect, the references in sections 47(2)(g), 53(2)(c) and 55(4) above to such regulations under this section as are prescribed shall have effect as including references to those byelaws.

(7) Any sums received by the Secretary of State in consequence of the provisions of any regulations under this section shall be paid into the Consolidated Fund.

(8) In this section “safe” has the same meaning as in Part II of the [1987 c. 43.] Consumer Protection Act 1987.

75 Power to prevent damage and to take steps to prevent contamination, waste etc

(1) Without prejudice to any power conferred on water undertakers by regulations under section 74 above, where a water undertaker which provides a supply of water to any premises has reason for believing—

(a) that damage to persons or property is being or is likely to be caused by any damage to, or defect in, any water fitting used in connection with the supply of water to those premises which is not a service pipe belonging to the undertaker;

(b) that water in a water main or other pipe of the undertaker is being or is likely to be contaminated by the return of any substance from those premises to that main or pipe;

(c) that water which is in any pipe connected with any such main or other pipe or which has been supplied by the undertaker to those premises is being or is likely to be contaminated before it is used; or

(d) that water which has been or is to be so supplied is being or is likely to be wasted or, having regard to the purposes for which it is supplied, misused or unduly consumed,

the undertaker may exercise the power conferred by subsection (2) below in relation to those premises.

(2) The power conferred by this subsection in relation to any premises is—

(a) where the case constitutes an emergency, power to disconnect the service pipe or otherwise to cut off the supply of water to those premises; and

(b) in any other case, power to serve notice on the consumer requiring him to take such steps as may be specified in the notice as necessary to secure that the damage, contamination, waste, misuse or undue consumption ceases or, as the case may be, does not occur.

(3) Where a water undertaker, in exercise of the power conferred by virtue of subsection (2)(a) above, disconnects a service pipe to any premises or otherwise cuts off any supply of water to any premises, the undertaker shall, as soon as reasonably practicable after the supply is disconnected or cut off, serve a notice on the consumer specifying the steps which that person is required to take before the undertaker will restore the supply.

(4) The steps specified in a notice under subsection (3) above shall be the steps necessary to secure that, as the case may be—

(a) the damage, contamination, waste, misuse or undue consumption; or

(b) the likelihood of damage, contamination, waste, misuse or undue consumption,

would not recur if the supply were restored.

(5) A water undertaker which fails, without reasonable excuse, to serve a notice in accordance with subsection (3) above shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

(6) A notice served for the purposes of subsection (2)(b) above shall—

(a) specify the period, not being less than the period of seven days beginning with the day after the service of the notice, within which the steps specified in the notice are to be taken; and

(b) set out the powers of the undertaker under subsections (7) to (9) below.

(7) Where a water undertaker has served a notice for the purposes of subsection (2)(b) above in relation to any premises and—

(a) the case becomes an emergency; or

(b) the premises appear to be unoccupied and the steps specified in the notice are not taken before the end of the period so specified,

the undertaker may disconnect the service pipe to those premises or otherwise cut off the supply of water to those premises.

(8) Subsections (3) to (5) above shall apply where a water undertaker exercises its power under subsection (7) above as they apply where such an undertaker exercises its power by virtue of subsection (2)(a) above.

(9) Where, in a case not falling within subsection (7)(a) or (b) above, any steps specified in a notice served by a water undertaker for the purposes of subsection (2)(b) above have not been taken by the end of the period so specified, the water undertaker shall have power—

(a) to take those steps itself; and

(b) subject to subsection (10) below, to recover any expenses reasonably incurred by the undertaker in taking those steps from the person on whom the notice was served;

and any steps taken by a water undertaker by virtue of paragraph (a) above shall be necessary works for the purposes of Chapter II of this Part.

(10) Where any steps are taken by virtue of this section and it is shown that, in the circumstances of the case, those steps were not necessary as mentioned in subsection (2) or, as the case may be, (4) above, the water undertaker in question–

(a) shall not be entitled to recover any expenses incurred by it in taking those steps; and

(b) shall be liable to pay to any other person who took any of those steps an amount equal to any expenses reasonably incurred by that person in taking any of those steps.

76 Temporary hosepipe bans

(1) If a water undertaker is of the opinion that a serious deficiency of water available for distribution by that undertaker exists or is threatened, that undertaker may, for such period as it thinks necessary, prohibit or restrict, as respects the whole or any part of its area, the use for the purpose of—

(a) watering private gardens; or

(b) washing private motor cars,

of any water supplied by that undertaker and drawn through a hosepipe or similar apparatus.

(2) A water undertaker imposing a prohibition or restriction under this section shall, before it comes into force, give public notice of it, and of the date on which it will come into force, in two or more newspapers circulating in the locality affected by the prohibition or restriction.

(3) Any person who, at a time when a prohibition or restriction under this section is in force, contravenes its provisions shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale.

(4) Where a prohibition or restriction is imposed by a water undertaker under this section, charges made by the undertaker for the use of a hosepipe or similar apparatus shall be subject to a reasonable reduction and, in the case of a charge paid in advance, the undertaker shall make any necessary repayment or adjustment.

(5) In this section “private motor car” means any mechanically propelled vehicle intended or adapted for use on roads other than—

(a) a public service vehicle, within the meaning of the [1981 c. 14.] Public Passenger Vehicles Act 1981; or

(b) a goods vehicle within the meaning of the [1988 c. 52.] Road Traffic Act 1988,

and includes any vehicle drawn by a private motor car.

Local authority functions

77 General functions of local authorities in relation to water quality

(1) It shall be the duty of every local authority to take all such steps as they consider appropriate for keeping themselves informed about the wholesomeness and sufficiency of water supplies provided to premises in their area, including every private supply to any such premises.

(2) It shall be the duty of a local authority to comply with any direction given by the Secretary of State to that authority, to authorities of a description applicable to that authority or to local authorities generally as to—

(a) the cases and circumstances in which they are or are not to exercise any of the powers conferred on them by this Chapter in relation to private supplies; and

(b) the manner in which those powers are to be exercised.

(3) The Secretary of State may by regulations make such provision, supplementing the provisions of this section and of sections 78 and 79(2) below, as he considers appropriate for—

(a) imposing duties and conferring powers on local authorities with respect to the acquisition of information about the quality and sufficiency of water supplies provided to premises in their areas; and

(b) regulating the performance of any duty imposed by or under any of those provisions.

(4) Without prejudice to the generality of subsection (3) above, regulations under that subsection may—

(a) prescribe the matters to be taken into account by a local authority in determining, for the purposes of subsection (1) above, what is appropriate;

(b) provide, for the purposes of the exercise or performance of any power or duty conferred or imposed on a local authority by or under any of the provisions mentioned in subsection (3) above, for such samples of water to be taken and analysed at such times and in such manner as may be prescribed;

(c) authorise local authorities to exercise or perform any such power or duty through prescribed persons;

(d) provide for the recovery by a local authority from prescribed persons of such amounts as may be prescribed in respect of expenses reasonably incurred by the authority in the exercise of any such power or the performance of any such duty.

78 Local authority functions in relation to undertakers' supplies

(1) It shall be the duty of a local authority to notify any water undertaker of anything appearing to the authority to suggest—

(a) that any supply by that undertaker of water for domestic or food production purposes to any premises in the area of that authority is, has been or is likely to become unwholesome or (so far as any such premises are concerned) insufficient for domestic purposes;

(b) that the unwholesomeness or insufficiency of any such supply is, was or is likely to be such as to cause a danger to life or health; or

(c) that the duty imposed on that undertaker by virtue of section 68(1)(b) above is being, has been or is likely to be so contravened as to affect any supply of water to premises in that area.

(2) Where a local authority have notified a water undertaker of any such matter as is mentioned in subsection (1) above, it shall be the duty of that authority, if they are not satisfied that all such remedial action as is appropriate will be taken by the undertaker, to inform the Secretary of State about the contents of the notification.

79 Local authority functions where piped supplies insufficient or unwholesome

(1) This section applies to a case in which it is not practicable at reasonable cost for a water undertaker, by supplying water in pipes, to provide or maintain such a supply of wholesome water to any particular premises in its area as (so far as those premises are concerned) is sufficient for domestic purposes.

(2) In any case to which this section applies, it shall be the duty of the local authority in whose area the premises in question are situated, if they are satisfied—

(a) that the insufficiency or unwholesomeness of the supply of water for domestic purposes to those premises is such as to cause a danger to life or health; and

(b) that it is practicable at reasonable cost for the water undertaker, by providing it otherwise than in pipes, to provide to those premises such a supply of wholesome water as is sufficient for those purposes,

to require the undertaker, under subsection (3) below, to provide a supply of water to those premises otherwise than in pipes.

(3) Where, in a case to which this section applies—

(a) the insufficiency or unwholesomeness of the supply of water for domestic purposes to the premises in question is such as to cause a danger to life or health;

(b) it is practicable at reasonable cost for the water undertaker, by providing it otherwise than in pipes, to provide to those premises such a supply of wholesome water as (so far as those premises are concerned) is sufficient for domestic purposes; and

(c) the local authority in whose area those premises are situated notify the undertaker of the danger to life or health and require the undertaker to provide a supply otherwise than in pipes,

it shall be the duty of the undertaker, for such period as may be required by that local authority, to provide any supply to those premises which it is practicable at reasonable cost to provide otherwise than in pipes and which it is required to provide by that authority.

(4) Where under this section a local authority require the provision by a water undertaker of a supply of water to any premises, that authority—

(a) shall be liable to the undertaker for any charges payable by virtue of Chapter I of Part V of this Act in respect of the provision of that supply; but

(b) shall have power to recover the whole or any part of any charges paid by virtue of this subsection from the owner or occupier of the premises to which the supply is provided.

(5) In this section references to the provision of a supply of water to any premises otherwise than in pipes shall have effect, in a case in which it is practicable at reasonable cost to provide a supply (whether or not in pipes) to a place within a reasonable distance of those premises, as including references to the provision of a supply to that place.

(6) The duty of a water undertaker under subsection (3) above shall be enforceable under section 18 above by the Secretary of State.

80 Remedial powers of local authorities in relation to private supplies

(1) Subject to the following provisions of this section, where a local authority are satisfied in relation to any premises in their area which are supplied with water for domestic or food production purposes by means of a private supply—

(a) that any water which is being, has been or is likely to be supplied for those purposes to those premises by means of that private supply is not, was not or, as the case may be, is likely not to be wholesome; or

(b) that that private supply is failing, has failed or is likely to fail to provide to any house on those premises such a supply of wholesome water as (so far as that house is concerned) is sufficient for domestic purposes,

the authority may serve a notice in relation to that private supply on one or more of the relevant persons.

(2) A notice under this section in relation to a private supply of water to any premises shall–

(a) give particulars of the matters mentioned in subsection (1) above in respect of which the notice is served;

(b) specify the steps which, in the opinion of the authority serving the notice, are required to be taken for ensuring that there is a supply of water to those premises which is both wholesome and (so far as any house on those premises is concerned) sufficient for domestic purposes;

(c) specify a period, ending not less than twenty-eight days after the day on which the notice is served, within which any representations or objections with respect to the notice must be received by that authority; and

(d) state the effect in relation to that notice of section 81(2) and (3) below.

(3) Subject to sections 81 and 82 below, where a local authority serve a notice under this section on any relevant person they may do one or more of the following, that is to say—

(a) by that notice designate as steps to be taken by the authority themselves such of the steps specified in the notice as they consider it appropriate so to designate;

(b) by that notice require that person, within such reasonable period as may be specified in the notice, to take one or more of the steps so specified;

(c) by that notice require that person, at such times as may be determined in accordance with provision contained in the notice, to make to another relevant person or to that authority such payments as may be so determined in respect of expenses reasonably incurred by that other person or that authority in taking any step specified in the notice;

(d) by that notice undertake from time to time to make such payments to that person as may be so determined in respect of expenses reasonably incurred by that person in taking any step specified in the notice.

(4) The power of a local authority to serve a notice under this section specifying the steps which are required to be taken in relation to any source from which a private supply is provided both to premises in the area of that authority and to premises in the area of another local authority shall be exercisable only where—

(a) the other authority consent to the service of the notice; or

(b) the authorities act jointly in exercising their respective powers under this section in relation to that source.

(5) The powers conferred by this section and sections 81 and 82 below shall be so exercised in relation to a private supply of water to any premises where there is no house as to secure that no local authority are required to bear any of the expenses incurred (whether by the authority or by any other person) in taking any of the steps for ensuring that the supply is wholesome which are specified in a notice under this section.

(6) The steps that a relevant person may be required by a notice under this section to take in relation to any premises shall include—

(a) requiring a supply of water to be provided to those premises by a water undertaker or by any other person; and

(b) taking such steps for the purpose of securing that such a requirement is complied with, and of enabling such a supply to be so provided, as may be specified in the notice.

(7) For the purposes of this section and sections 81 to 83 below the relevant persons, in relation to a private supply of water to any premises in the area of a local authority, are—

(a) the owners and occupiers of those premises; and

(b) whether or not the source of the private supply is in that authority’s area, the owners and occupiers of the premises where that source is situated and any other person who exercises powers of management or control in relation to that source;

and in sections 81 to 83 below a notice under this section is referred to as a private supply notice.

81 Confirmation of private supply notices

(1) Subject to subsection (2) below, a private supply notice served by a local authority shall not take effect until the end of the period specified in the notice as the period within which representations or objections with respect to the notice must be received by that authority.

(2) Where any written representation or objection with respect to a private supply notice served by a local authority is received by the authority, before the end of the period specified in the notice, from a person on whom the notice was served, that notice shall not take effect unless—

(a) the notice is submitted by the authority to the Secretary of State and is confirmed by him either with or without modifications; or

(b) the representation or objection is withdrawn.

(3) If a local authority submit a private supply notice to the Secretary of State for confirmation, the Secretary of State—

(a) shall consider whether the notice should be confirmed and whether, if it is confirmed, it should be confirmed with or without modifications;

(b) may, with respect to the matters specified in the notice or any proposed modification of it, direct the local authority to serve a private supply notice, in such terms as may be specified in the direction, on any relevant person who has not previously been served with such a notice;

(c) may, for the purposes of paragraph (a) or (b) above cause a local inquiry to be held or afford—

(i) to the local authority; and

(ii) to every person who has made representations or objections with respect to the notice or any proposed direction under paragraph (b) above,

an opportunity of appearing before and being heard by a person appointed by the Secretary of State for the purpose; and

(d) if he is satisfied that the person on whom any notice to be served in pursuance of a direction under paragraph (b) above has had a proper opportunity of having his representations or objections with respect to the proposal for the direction considered, may dispense, in relation to the notice so served, with the provisions of subsections (1) and (2) above and of section 80(2)(c) and (d) above.

(4) Where the Secretary of State confirms a private supply notice (whether with or without modifications)—

(a) he, or if he so directs, the local authority concerned shall serve notice of that confirmation on every person originally served with the notice under section 80 above; and

(b) that notice shall take effect, with any modifications made by the Secretary of State, at such time as may be specified in the notice served under this subsection.

82 Enforcement and variation of private supply notice

(1) Where any relevant person who is required by virtue of a private supply notice to take any step in relation to any premises fails to take that step within the period specified in the notice, the authority which served the notice may, in accordance with any applicable provision having effect by virtue of section 83 or 84 below, take that step themselves.

(2) Where any step is taken by a local authority in relation to any premises by virtue of subsection (1) above—

(a) the authority may recover from the person who failed to take that step within the specified period any expenses reasonably incurred by the authority in tak