PART II continued CHAPTER I continued
(2) Subject to subsection (5) below, where in the case of any company holding an appointment under this Chapter—
(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 order be made,
he may (instead of taking steps towards the making of a final order) by a provisional 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 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 requirement enforceable under this section, is likely to be done, or omitted to be done, before a final order may be made.
(4) Subject to subsection (5) and section 21 below, where the Secretary of State or the Director has made a provisional 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 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) Neither the Secretary of State nor the Director shall be required to make a final order or provisional order in relation to any company or to confirm a provisional 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.
(6) Where the Secretary of State or the Director, having notified a company that he is considering the making in relation to the company of a final order or provisional order or the confirmation of a provisional order so made, is satisfied as mentioned in paragraph (a), (b) or (c) of subsection (5) 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;
but the requirements of the preceding provisions of this subsection shall not apply, in the case of any proposed order or confirmation in respect of a direction under section 170 below, to the extent that the Secretary of State directs that they should not be complied with in the interests of national security.
(7) A final or provisional 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.
(8) For the purposes of this section and the following provisions of this Act—
(a) the statutory requirements which shall be enforceable under this section in relation to a company holding an appointment under this Chapter shall be—
(i) such of the requirements of section 8 or 9 above as are imposed on that company in consequence of that appointment; and
(ii) such of the requirements of any other enactment or of any subordinate legislation as are so imposed and 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 this Chapter;
(c) the Secretary of State shall be the enforcement authority in relation to the requirements imposed by sections 8 and 9 above; and
(d) the enforcement authority in relation to each of the other statutory 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;
and the requirement to comply with an undertaking given for the purposes of subsection (5)(b) above shall be treated as a statutory requirement enforceable under this section by the Secretary of State or, with the consent of or in accordance with a general authorisation given by the Secretary of State, by the Director.
(9) In this section and sections 21 and 22 below—
“final order” means an order under this section other than a provisional order;
“provisional 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.
(10) Where any act or omission constitutes a contravention of a condition of an appointment under this Chapter or of a statutory 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.
(1) Before making a final order or confirming a provisional 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 order with modifications, or confirm a provisional 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 a final order or making or confirming a provisional 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 a final order or a provisional order which has been confirmed, 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 170 below, to the extent that the Secretary of State directs that they should not be complied with in the interests of national security.
(1) If the company to which a final or provisional 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 20 above; or
(b) that any of the requirements of section 21 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 a final or provisional order shall not be questioned in any legal proceedings whatsoever.
(4) The obligation to comply with a final or provisional order shall be a duty owed to any person who may be affected by a contravention of the order.
(5) Where a duty is owed by virtue of subsection (4) 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.
(6) In any proceedings brought against any company in pursuance of subsection (5) 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 52(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.
(7) Without prejudice to any right which any person may have by virtue of subsection (5) above to bring civil proceedings in respect of any contravention or apprehended contravention of a final or provisional 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.
(8) In subsection (7) above “the relevant enforcement authority”, in relation to any final or provisional 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.
(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 this Chapter that any one or more of the grounds specified in subsection (4) below is satisfied in relation to that company, that Court may make an order under this section.
(2) An order under this section is an order 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, for the achievement of the purposes of the order and in a manner which protects the respective interests of the members and creditors of the company.
(3) The purposes of an order made under this section in relation to a company holding an appointment under this Chapter shall be—
(a) the transfer to another company, or (as respects different parts of the company’s area 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 to which section 12 above applies).
(4) 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 a requirement imposed on the company by section 37 or 67 below, not being a contravention in respect of which a notice has been served under subsection (6) of section 20 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 final order or provisional order under section 20 above, being an order which—
(i) is not for the time being the subject-matter of proceedings brought by virtue of section 22(1) above; and
(ii) if it is a provisional 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 24 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 this Chapter; 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 subsection (2)(c) of section 12 above of any appointment or variation to which that section applies.
(5) Notice of the petition for an order under this section 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; and no such petition shall be withdrawn except with the leave of the High Court.
(6) Subsections (4) and (5) of section 9 of the said Act of 1986 (powers on application for administration order) shall apply on the hearing of the petition for an order under this section in relation to any company as they apply on the hearing of a petition for an administration order.
(7) Subsections (1), (2) and (4) of section 10 of the said Act of 1986 (effect of petition) shall apply in the case of a petition for an order under this section in relation to any company as if—
(a) the reference in subsection (1) to an administration order were a reference to an order under this section;
(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 20 above.
(8) Schedule 6 to this Act shall have effect with respect to orders under this section and Schedule 5 to this Act shall have effect with respect to the making of transitional provision for the purposes of an order under this section.
(9) In this section and section 24 below—
“business” and “property” have the same meanings as in the [1986 c. 45.] Insolvency Act 1986;
“security” has the same meaning as in Parts I to VII of that Act;
and for the purposes of this section a company is unable to pay its debts if it is a limited company which is deemed to be so unable under section 123 of the Insolvency Act 1986 (definition of inability to pay debts) or if 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).
(1) Where a company holds an appointment under this Chapter—
(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 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) On an application made to any court for the winding up of a company which holds an appointment under this Chapter—
(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 an order under section 23 above in relation to the company.
(1) Where a special administration order is for the time being in force in relation to a company, the Secretary of State, may, with the consent of the Treasury—
(a) make to the company grants or loans of such sums as appear to him to be appropriate for the purpose of facilitating the achievement of the purposes of the order;
(b) agree to indemnify the person appointed to achieve the purposes of the order in respect of liabilities incurred and loss or damage sustained by that person in connection with the carrying out of his functions under the order.
(2) The Secretary of State may, with the consent of the Treasury, guarantee, in such manner and on such conditions as he may think fit, the repayment of the principal of, the payment of interest on and the discharge of any other financial obligation in connection with any sum which is borrowed from any person by a company in relation to which a special administration order is in force at the time when the guarantee is given.
(3) Without prejudice to any provision applied in relation to the company by Schedule 6 to this Act—
(a) the terms and conditions on which a grant is made to any company under this section may require the whole or part of the grant to be repaid to the Secretary of State if there is a contravention of the other terms and conditions on which the grant is made; and
(b) any loans which the Secretary of State makes to a company under this section shall be repaid to him at such times and by such methods, and interest thereon shall be paid to him at such rates and at such times, as he may, with the consent of the Treasury, from time to time direct.
(4) Any grant or loan made under this section and any sums required to be paid by the Secretary of State in respect of an indemnity given under this section shall be paid out of money provided by Parliament.
(5) Any sums received under subsection (3) above by the Secretary of State shall be paid into the Consolidated Fund.
(6) In this section “special administration order” means an order under section 23 above (whether made by virtue of that section or section 24 above).
(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 this Chapter of the functions of water undertakers or sewerage 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 this Part 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 the functions of water undertakers or sewerage undertakers or the carrying out of any such functions by a company holding an appointment under this Chapter.
(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, 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 to make to a company so allocated all such representations about any such matter as the committee considers appropriate;
(b) subject to paragraph (c) below, to investigate any complaint which—
(i) is made to the committee by any person who is a customer or potential customer of a company so allocated or is referred to the committee by the Director under subsection (2) below;
(ii) does not appear to the committee to be vexatious or frivolous; and
(iii) relates to the carrying out by that company of any of the functions of a water undertaker or sewerage undertaker;
(c) 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 complaint which the Director would be required to investigate under section 162 below or an assertion that the company is contravening or has contravened—
(i) any condition of the company’s appointment under this Chapter; or
(ii) any statutory or other requirement enforceable under section 20 above;
(d) where the committee considers it appropriate to do so in connection with any such complaint as is mentioned in paragraph (b) above, to make representations on behalf of the complainant to the company in question about any matter to which the complaint relates or which appears to the committee to be relevant to the subject-matter of the complaint; and
(e) 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.
(2) It shall be the duty of the Director—
(a) to consider whether any complaint which—
(i) is made to him by a customer or potential customer of a company allocated to a customer service committee; and
(ii) does not consist in or amount to a complaint which he is required to investigate under section 162 below or such an assertion as is mentioned in subsection (1)(c) above,
should be referred to that committee instead of being dealt with by him;
(b) to consider whether any complaint which does consist in or amount to such an assertion and is either made to him by such a customer or potential customer or is referred to him by such a committee should be referred by him to the Secretary of State;
(c) to consider any such complaint as is mentioned in paragraph (b) above which is not referred by him to the Secretary of State;
(d) to consider any complaint referred to him by virtue of subsection (1)(e) above;
(e) to consider any complaint made to him 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 subsection (1) above; and
(f) to take such steps in consequence of his consideration of any matter falling within any of paragraphs (a) to (e) above (including in a case falling within paragraph (d) or (e) above any step which could have been taken by the committee) as he considers appropriate.
(3) The only remedy for a breach by a customer service committee of a duty imposed on it by subsection (1) above shall be the making of such a complaint to the Director as is mentioned in subsection (2)(e) above.
(4) 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.
(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 c. 41.] Fair Trading Act 1973 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 the supply of water by water undertakers or the provision of sewerage services by sewerage undertakers, whether those interests are economic or interests in respect of health, safety or other matters; and references in that Part to that Director shall be construed accordingly.
(2) There are hereby transferred to the Director (so as to be exercisable concurrently with the Director General of Fair Trading)—
(a) the functions of that Director under sections 44 and 45 of the Fair Trading Act 1973; 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; and references in Part IV and sections 86, 88 and 133 of that Act to that Director shall be construed accordingly.
(3) There are hereby transferred to the Director (so as to be exercisable concurrently with the Director General of Fair Trading) the functions of that Director under sections 2 to 10 and 16 of the [1980 c. 21.] Competition Act 1980 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; and references in those sections and in section 19 of that Act to that Director shall be construed accordingly.
(4) Before either Director first exercises in relation to any matter functions transferred by any of the following provisions, namely—
(a) paragraph (a) of subsection (2) above;
(b) paragraph (b) of that subsection; and
(c) subsection (3) above,
he shall consult the other Director; and neither Director shall exercise in relation to any matter functions transferred by any of those provisions if functions transferred by that provision have been exercised in relation to that matter by the other Director.
(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 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.
(6) 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 c. 41.] Fair Trading Act 1973; or
(b) sections 2 to 10 of the [1980 c. 21.] Competition Act 1980,
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.
(7) Expressions used in this section which are also used in the Fair Trading Act 1973 or the Competition Act 1980 have the same meaning as in that Act.
(1) Subject to the following provisions of this section, 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 at any time on or after 11th January 1989 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) For the purposes of this section an enterprise shall be regarded as a water enterprise—
(a) in relation to a merger on or after the transfer date, if it is carried on by a water undertaker or sewerage undertaker; and
(b) in relation to a merger on or after 11th January 1989 and before the transfer date, if it is or was carried on by a statutory water company within the meaning of the 1973 Act or by a water authority.
(3) 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—
(a) 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;
(b) 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 c. 41.] Fair Trading Act 1973 (condition of merger reference relating to amount of assets taken over); or
(c) 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.
(4) For the purposes of subsection (3) 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.