Health and Social Care Bill (HL Bill 119)

Health and Social Care BillPage 110

(e) requiring the licence holder to provide Monitor with such information
as Monitor considers necessary for the purposes of the exercise of its
functions under this Part,

(f) requiring the licence holder to publish such information as may be
5specified or as Monitor may direct,

(g) requiring the licence holder to charge for the provision of health care
services for the purposes of the NHS in accordance with the national
tariff (see section 116),

(h) requiring the licence holder to comply with other rules published by
10Monitor about the charging for the provision of health care services for
the purposes of the NHS,

(i) requiring the licence holder—

(i) to do, or not to do, specified things or things of a specified
description (or to do, or not to do, any such things in a specified
15manner) within such period as may be specified in order to
ensure the continued provision of one or more of the health care
services that the licence holder provides for the purposes of the
NHS,

(ii) to give Monitor notice (of such period as may be determined by
20or under the licence) of the licence holder’s intention to cease
providing a health care service for the purposes of the NHS, and

(iii) if Monitor so directs, to continue providing that service for a
period determined by Monitor,

(j) about the use or disposal by the licence holder of assets used in the
25provision of health care services for the purposes of the NHS in order
to ensure the continued provision of one or more of the health care
services that the licence holder provides for those purposes, and

(k) about the making by the licence holder of investment in relation to the
provision of health care services for the purposes of the NHS in order
30to ensure the continued provision of one or more of the health care
services that the licence holder provides for those purposes.

(2) In subsection (1) “specified” means specified in a condition.

(3) Monitor must not include a condition under subsection (1)(c) that requires the
licence holder (A) to provide another licence holder with access to facilities of
35A.

(4) A condition under subsection (1)(d)

(a) may be included only in the licence of an NHS foundation trust or a
body which (or part of which) used to be an NHS trust established
under section 25 of the National Health Service Act 2006, and

(b) 40ceases to have effect at the end of the period of five years beginning
with the day on which it is included in the licence.

(5) The references in subsection (1)(d) to the activities of a licence holder or other
business include a reference to part of the activities concerned.

(6) The references in subsections (1)(d) and (5) to the activities of a business
45include a reference to the activities of an NHS foundation trust in so far as its
activities would not otherwise be the activities of a business.

(7) A condition of a licence under this Chapter may provide that it is to have effect,
or cease to have effect, at such times and in such circumstances as may be
determined by or under the conditions.

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99 Conditions relating to the continuation of the provision of services etc.

(1) The things which a licence holder may be required to do by a condition under
section 98(1)(i)(i) include, in particular—

(a) providing information to the commissioners of services to which the
5condition applies and to such other persons as Monitor may direct,

(b) allowing Monitor to enter premises owned or controlled by the licence
holder and to inspect the premises and anything on them, and

(c) co-operating with such persons as Monitor may appoint to assist in the
management of the licence holder’s affairs, business and property.

(2) 10A commissioner of services to which a condition under section 98(1)(i), (j) or (k)
applies must co-operate with persons appointed under subsection (1)(c) in
their provision of the assistance that they have been appointed to provide.

(3) Where a licence includes a condition under section 98(1)(i), (j) or (k), Monitor
must carry out an ongoing assessment of the risks to the continued provision
15of services to which the condition applies.

(4) Monitor must publish guidance—

(a) for commissioners of a service to which a condition under section
98(1)(i), (j) or (k) applies about the exercise of their functions in
connection with the licence holders who provide the service, and

(b) 20for such licence holders about the conduct of their affairs, business and
property at a time at which such a condition applies.

(5) A commissioner of services to which a condition under section 98(1)(i), (j), or
(k) applies must have regard to guidance under subsection (4)(a).

(6) Monitor may revise guidance under subsection (4) and, if it does so, must
25publish the guidance as revised.

(7) Before publishing guidance under subsection (4) or (6), Monitor must obtain
the approval of—

(a) the Secretary of State, and

(b) the National Health Service Commissioning Board.

100 30Modification of standard conditions

(1) Monitor may, subject to the requirements of this section, modify the standard
conditions applicable to all licences under this Chapter or to licences of a
particular description.

(2) Before making any such modifications Monitor must give notice to—

(a) 35each relevant licence holder,

(b) the Secretary of State,

(c) the National Health Service Commissioning Board,

(d) every clinical commissioning group, and

(e) the Care Quality Commission and its Healthwatch England committee.

(3) 40Monitor must also publish the notice under subsection (2).

(4) The notice under subsection (2) must—

(a) state that Monitor proposes to make the modifications,

(b) set out the proposed effect of the modifications,

(c) set out Monitor’s reasons for the proposal, and

Health and Social Care BillPage 112

(d) specify the period (“the notice period”) within which representations
with respect to the proposal may be made to Monitor.

(5) The notice period must be not less than 28 days beginning with the day after
that on which the notice is published under subsection (3).

(6) 5Monitor may not make any modifications under this section unless—

(a) no relevant licence holder has made an objection to Monitor about the
proposal within the notice period, or

(b) subsection (7) applies to the case.

(7) This subsection applies where—

(a) 10one or more relevant licence holders make an objection to Monitor
about the proposal within the notice period,

(b) the objection percentage is less than the percentage prescribed for the
purposes of this paragraph, and

(c) the share of supply percentage is less than the percentage prescribed for
15the purposes of this paragraph.

(8) In subsection (7)

(a) the “objection percentage” is the proportion (expressed as a percentage)
of the relevant licence holders who objected to the proposals;

(b) the “share of supply percentage” is the proportion (expressed as a
20percentage) of the relevant licence holders who objected to the
proposals, weighted according to their share of the supply in England
of such services as may be prescribed.

(9) Regulations prescribing a percentage for the purposes of subsection (7)(c) may
include provision prescribing the method to be used for determining a licence
25holder’s share of the supply in England of the services concerned.

(10) Where Monitor modifies the standard conditions applicable to all licences or
(as the case may be) to licences of a particular description under this section,
Monitor—

(a) may also make such incidental or consequential modifications as it
30considers necessary or expedient of any other conditions of a licence
which is affected by the modifications,

(b) must make (as nearly as may be) the same modifications of those
conditions for the purposes of their inclusion in all licences or (as the
case may be) licences of that description granted after that time, and

(c) 35must publish the modifications.

(11) In this section and section 101, “relevant licence holder”—

(a) in relation to proposed modifications of the standard conditions
applicable to all licences, means any licence holder, and

(b) in relation to proposed modifications of the standard conditions
40applicable to licences of a particular description, means a holder of a
licence of that description.

(12) In this section, a reference to modifying a condition includes a reference to
amending, omitting or adding a condition.

101 Modification references to the Competition Commission

(1) 45Subsection (2) applies where—

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(a) Monitor has given notice under section 96(2) of a proposal to include a
special condition in a licence or modify such a condition, and

(b) the applicant or (as the case may be) licence holder concerned has
refused consent to the inclusion of the condition or the making of the
5modifications.

(2) Monitor may make a reference to the Competition Commission which is so
framed as to require the Commission to investigate and report on the
questions—

(a) whether any matters which relate to the provision, or proposed
10provision, of a health care service for the purposes of the NHS by the
applicant or (as the case may be) licence holder concerned and which
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
15matters have or may be expected to have could be remedied or
prevented by the inclusion of a special condition in the applicant’s
licence or by modifications of a special condition of the licence holder’s
licence.

(3) Subsection (4) applies where—

(a) 20Monitor has given notice under section 100(2) of a proposal to make
modifications to the standard conditions applicable to all licences
under this Chapter, or to licences of a particular description, and

(b) section 100 operates to prevent Monitor from making the
modifications.

(4) 25Monitor may make a reference to the Competition Commission which is so
framed as to require the Commission to investigate and report on the
questions—

(a) whether any matters which relate to the provision of health care
services for the purposes of the NHS by the relevant licence holders,
30and which are specified in the reference, operate, or may be expected to
operate, against the public interest, and

(b) if so, whether the effects adverse to the public interest which those
matters have or may be expected to have could be remedied or
prevented by modifications of the standard conditions applicable to all
35licences under this Chapter, or to licences of a particular description.

(5) Schedule 10 (which makes further provision about references to the
Competition Commission) has effect in relation to a reference under subsection
(2) or (4); and, for that purpose, the relevant persons are—

(a) in paragraphs 3, 6(6) and 7(6)—

(i) 40the applicant or licence holder concerned or (as the case may be)
relevant licence holders,

(ii) the National Health Service Commissioning Board, and

(iii) such clinical commissioning groups as are likely to be affected
by matters to which the reference relates,

(b) 45in paragraph 5(6), the applicant or licence holder concerned or (as the
case may be) relevant licence holders, and

(c) in paragraph 8(10)—

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

(ii) 50Monitor,

Health and Social Care BillPage 114

(iii) the National Health Service Commissioning Board, and

(iv) such clinical commissioning groups as are likely to be affected
by the proposal concerned.

(6) In investigating the question under subsection (2)(a) or (4)(a) the Competition
5Commission must have regard to—

(a) the matters in respect of which Monitor has duties under section 61,
and

(b) the matters to which Monitor must have regard by virtue of section 64.

(7) Where the standard conditions applicable to all licences or (as the case may be)
10to licences of a particular description are modified pursuant to a reference
made under subsection (4), Monitor—

(a) may also make such incidental or consequential modifications as it
considers necessary or expedient of any other conditions of a licence
which is affected by the modifications,

(b) 15must make (as nearly as may be) the same modifications of those
conditions for the purposes of their inclusion in all licences or (as the
case may be) licences of that description granted after that time, and

(c) must publish any modifications made under this subsection.

(8) In this section, a reference to modifying a condition includes a reference to
20amending, omitting or adding a condition.

102 Modification of conditions by order under other enactments

(1) This section applies where the Office of Fair Trading, Competition
Commission or Secretary of State (the “relevant authority”) makes a relevant
order.

(2) 25A relevant order may modify—

(a) the conditions of a particular licence, or

(b) the standard conditions applicable to all licences under this Chapter or
to licences of a particular description.

(3) The modifications which may be made by a relevant order are those which the
30relevant authority considers necessary or expedient for the purpose of giving
effect to, or taking account of, any provision made by the order.

(4) In this section “relevant order” means—

(a) an order under section 75, 83 or 84 of, or paragraph 5, 10 or 11 of
Schedule 7 to, the Enterprise Act 2002 where one or more of the
35enterprises which have, or may have, ceased to be distinct enterprises
were engaged in the provision of health care services for the purposes
of the NHS;

(b) an order under any of those provisions of that Act where one or more
of the enterprises which will or may cease to be distinct enterprises is
40engaged in the provision of health care services for the purposes of the
NHS;

(c) an order under section 160 or 161 of that Act where the feature, or
combination of features, of the market in the United Kingdom for
goods or services which prevents, restricts or distorts competition
45relates to—

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(i) the commissioning by the National Health Service
Commissioning Board or a clinical commissioning group of
health care services for the purposes of the NHS, or

(ii) the provision of those services.

(5) 5The modification under subsection (2)(a) of part of a standard condition of a
licence does not prevent any other part of the condition from continuing to be
regarded as a standard condition for the purposes of this Chapter.

(6) Where the relevant authority modifies the standard conditions applicable to all
licences or (as the case may be) to licences of a particular description under this
10section, the relevant authority—

(a) may, after consultation with Monitor, make such incidental or
consequential modifications as the relevant authority considers
necessary or expedient of any other conditions of any licence which is
affected by the modifications,

(b) 15must also make (as nearly as may be) the same modifications of those
conditions for the purposes of their inclusion in all licences or (as the
case may be) licences of that description granted after that time, and

(c) must publish any modifications it makes under paragraph (b).

(7) Expressions used in subsection (4) and in Part 3 or (as the case may be) Part 4
20of the Enterprise Act 2002 have the same meaning in that subsection as in that
Part.

(8) In this section, a reference to modifying a condition includes a reference to
amending, omitting or adding a condition.

103 Standard condition as to transparency of certain criteria

(1) 25The standard conditions applicable to any licence under this Chapter must
include a condition requiring the licence holder to—

(a) set transparent eligibility and selection criteria, and

(b) apply those criteria in a transparent way to persons who, having a
choice of persons from whom to receive health care services for the
30purposes of the NHS, choose to receive them from the licence holder.

(2) “Eligibility and selection criteria”, in relation to a licence holder, means criteria
for determining—

(a) whether a person is eligible, or is to be selected, to receive health care
services provided by the licence holder for the purposes of the NHS,
35and

(b) if the person is selected, the manner in which the services are provided
to the person.

(3) The following powers must not be exercised so as to omit the condition
mentioned in subsection (1) from any licence under this Chapter—

(a) 40the powers conferred on Monitor by sections 100, 101(7) and paragraph
7(2) of Schedule 10 to modify the standard conditions applicable to all
licences, or to licences of a particular description,

(b) the power conferred on the Competition Commission by paragraph
8(5) of that Schedule to modify those conditions, and

(c) 45the powers conferred by section 102 on the Office of Fair Trading,
Competition Commission and Secretary of State to modify those
conditions or the conditions of a particular licence.

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Enforcement

104 Power to require documents and information

(1) Monitor may require a person mentioned in subsection (2) to provide it with
any information, documents, records or other items which it considers it
5necessary or expedient to have for the purposes of any of its regulatory
functions.

(2) The persons are—

(a) an applicant for a licence under this Chapter,

(b) a licence holder,

(c) 10a person who has provided, or is providing, a health care service for the
purposes of the NHS in accordance with an exemption by virtue of
section 84 from the requirement to hold a licence under this Chapter,

(d) a person who has provided, or is providing, a health care service for the
purposes of the NHS in breach of that requirement,

(e) 15the National Health Service Commissioning Board, and

(f) a clinical commissioning group.

(3) The power in subsection (1) includes, in relation to information, documents or
records kept by means of a computer, power to require the provision of the
information, documents or records in legible form.

(4) 20For the purposes of subsection (1) Monitor’s regulatory functions are its
functions under—

(a) this Chapter,

(b) Chapters 4 to 6,

(c) Chapter 5 of Part 2 of the National Health Service Act 2006 (NHS
25foundation trusts), and

(d) Chapter 5A of that Part of that Act (trust special administration).

105 Discretionary requirements

(1) Monitor may impose one or more discretionary requirements on a person if
Monitor is satisfied that the person—

(a) 30has provided, or is providing, a health care service for the purposes of
the NHS in breach of the requirement to hold a licence under this
Chapter (see section 82),

(b) is a licence holder who has provided, or is providing, a health care
service for the purposes of the NHS in breach of a condition of the
35licence, or

(c) is in breach of a requirement imposed by Monitor under section 104.

(2) In this Chapter, “discretionary requirement” means—

(a) a requirement to pay a monetary penalty to Monitor of such amount as
Monitor may determine (referred to in this Chapter as a “variable
40monetary penalty”),

(b) a requirement to take such steps within such period as Monitor may
specify, to secure that the breach in question does not continue or recur
(referred to in this Chapter as a “compliance requirement”), or

(c) a requirement to take such steps within such period as Monitor may
45specify, to secure that the position is, so far as possible, restored to what

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it would have been if the breach in question was not occurring or had
not occurred (referred to in this Chapter as a “restoration
requirement”).

(3) Monitor must not impose discretionary requirements on a person on more
5than one occasion in relation to the same breach.

(4) A variable monetary penalty must not exceed 10% of the turnover in England
of the person on whom it is imposed, such amount to be calculated in the
prescribed manner.

(5) If the whole or any part of a variable monetary penalty is not paid by the time
10it is required to be paid, the unpaid balance from time to time carries interest
at the rate for the time being specified in section 17 of the Judgments Act 1838;
but the total interest must not exceed the amount of the penalty.

106 Enforcement undertakings

(1) Monitor may accept an enforcement undertaking from a person if Monitor has
15reasonable grounds to suspect that the person—

(a) has provided, or is providing, a health care service for the purposes of
the NHS in breach of the requirement to hold a licence under this
Chapter,

(b) is a licence holder who has provided, or is providing, a health care
20service for the purposes of the NHS in breach of a condition of the
licence, or

(c) is in breach of a requirement imposed by Monitor under section 104.

(2) In this Chapter, “enforcement undertaking” means an undertaking from a
person to take such action of a kind mentioned in subsection (3) as may be
25specified in the undertaking within such period as may be so specified.

(3) The specified action must be—

(a) action to secure that the breach in question does not continue or recur,

(b) action to secure that the position is, so far as possible, restored to what
it would have been if the breach in question was not occurring or had
30not occurred,

(c) action (including the payment of a sum of money) to benefit—

(i) any other licence holder affected by the breach, or

(ii) any commissioner of health care services for the purposes of the
NHS which is affected by the breach, or

(d) 35action of such a description as may be prescribed.

(4) Where Monitor accepts an enforcement undertaking then, unless the person
from whom the undertaking is accepted has failed to comply with the
undertaking or any part of it—

(a) Monitor may not impose on that person any discretionary requirement
40which it would otherwise have power to impose by virtue of section
105 in respect of the breach to which the undertaking relates, and

(b) if the breach to which the undertaking relates falls within subsection
(1)(b), Monitor may not revoke that person’s licence under section
90(b).

(5) 45Where a person from whom Monitor has accepted an enforcement
undertaking has failed to comply fully with the undertaking but has complied

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with part of it, Monitor must take the partial compliance into account in
deciding whether—

(a) to impose a discretionary requirement on the person in respect of the
breach to which the undertaking relates, or

(b) 5if the breach to which the undertaking relates falls within subsection
(1)(b), to revoke the person’s licence under section 90(b).

107 Further provision about enforcement powers

Schedule 11 (Part 1 of which makes further provision about discretionary
requirements and Part 2 of which makes further provision about enforcement
10undertakings) has effect.

108 Guidance as to use of enforcement powers

(1) Monitor must publish guidance about how it intends to exercise its functions
under sections 105 and 106 and Schedule 11.

(2) Monitor may revise the guidance and, if it does so, must publish the guidance
15as revised.

(3) Monitor must consult such persons as it considers appropriate before
publishing or revising the guidance.

(4) Guidance relating to Monitor’s functions under section 105 must include
information about—

(a) 20the circumstances in which Monitor is likely to impose a discretionary
requirement,

(b) the circumstances in which Monitor may not impose a discretionary
requirement,

(c) the matters likely to be taken into account by Monitor in determining
25the amount of any variable monetary penalty to be imposed (including,
where relevant, any discounts for voluntary reporting of breaches in
respect of which a penalty may be imposed), and

(d) rights to make representations and rights of appeal.

(5) Monitor must have regard to the guidance or (as the case may be) revised
30guidance in exercising its functions under sections 105 and 106 and Schedule
11.

109 Publication of enforcement action

(1) Monitor must include information about the following in its annual report—

(a) the cases in which a discretionary requirement has been imposed
35during the financial year to which the report relates, and

(b) the cases in which an enforcement undertaking has been accepted
during that financial year.

(2) But Monitor must not include information which it is satisfied is—

(a) commercial information the disclosure of which would, or might,
40significantly harm the legitimate business interests of the person to
whom it relates;

(b) information relating to the private affairs of an individual the
disclosure of which would, or might, significantly harm that person’s
interests.

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(3) The reference in subsection (1)(a) to cases in which a discretionary requirement
has been imposed does not include a reference to a case where a discretionary
requirement has been imposed but overturned on appeal.

110 Notification of enforcement action

(1) 5As soon as reasonably practicable after imposing a discretionary requirement
or accepting an enforcement undertaking Monitor must notify the following of
that fact—

(a) the National Health Service Commissioning Board,

(b) such clinical commissioning groups as are likely to be affected by the
10imposition of the requirement or the acceptance of the undertaking,
and

(c) any person exercising regulatory functions in relation to the person on
whom the discretionary requirement was imposed or from whom the
enforcement undertaking was accepted.

(2) 15In subsection (1) “regulatory functions” has the same meaning as in the
Legislative and Regulatory Reform Act 2006 (see section 32 of that Act).

Transitional provision

111 Imposition of licence conditions on NHS foundation trusts

(1) Where Monitor is satisfied that there is a significant risk that an NHS
20foundation trust will fail to fulfil its principal purpose (as to which, see section
43(1) of the National Health Service Act 2006), Monitor may include in the
trust’s licence such conditions as it considers appropriate for the purpose of
reducing that risk.

(2) A condition included under subsection (1) has effect until this section ceases,
25by virtue of section 112, to have effect in relation to the trust.

(3) Monitor may modify a condition included under subsection (1).

(4) Where Monitor is satisfied that the trust has breached or is breaching a
condition included under subsection (1), Monitor may by notice—

(a) require the trust, the directors or the council of governors to do, or not
30to do, specified things or things of a specified description (or to do, or
not to do, any such things in a specified manner) within such period as
may be specified;

(b) remove one or more of the directors or members of the council of
governors and appoint interim directors or members of the council;

(c) 35suspend one or more of the directors or members of the council from
office as a director or member for a specified period;

(d) disqualify one or more of the directors or members of the council from
holding office as a director or member for a specified period.

(5) Where Monitor is satisfied that a person has breached or is breaching a
40requirement imposed under subsection (4)(a), or has otherwise failed or is
otherwise failing to comply with a notice under subsection (4), Monitor may by
notice exercise one or more of the powers specified in paragraphs (a) to (d) of
that subsection.