Utilities Bill

Utilities Bill - continued	House of Commons

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PART IV

THE COMPETITION COMMISSION

Commission's functions under utilities legislation

Specialist members of the Competition Commission.

124. - (1) The Secretary of State shall appoint not less than eight members of the Competition Commission ("the Commission") for the purpose of references to the Commission under or by virtue of any of the following provisions, namely-

(a) section 13 of the Telecommunications Act 1984;

(b) sections 6D and 24 of the Gas Act 1986;

(d) sections 12 and 14 of the Water Industry Act 1991.

(2) In selecting a group to perform the Commission's functions in relation to such a reference, or functions in relation to any licence modifications or modifications of the conditions of a company's appointment under Chapter I of Part II of the Water Industry Act 1991 to be made following the Commission's report, the chairman of the Commission shall select one or more of the members appointed under subsection (1) to be members of the group.

(3) In paragraph 2(1)(d) of Schedule 7 to the Competition Act 1998 (membership of Commission to include specialist members appointed under utilities legislation), for sub-paragraphs (i) to (iv) there is substituted the words "section 124 of the Utilities Act 2000 or Article 15(9) of the Electricity (Northern Ireland) Order 1992".

(4) The following provisions (which are superseded by this section) shall cease to have effect-

(a) section 13(10) and (10A) of the Telecommunications Act 1984;

(b) section 12(9) and (9A) of the Electricity Act 1989;

(5) The persons who are, immediately before the commencement of this section, members of the Competition Commission by virtue of appointments made under any provision mentioned in subsection (4) shall continue as members of the Commission and their appointments shall be treated as having been made under this section.

(6) Nothing in this section affects any group which has been selected, before the commencement of this section, to perform functions of the Commission in relation to any reference under or by virtue of section 13 of the Telecommunications Act 1984, section 12 of the Electricity Act 1989 or section 12 or 14 of the Water Industry Act 1991.

Determination references under s. 12 of the Water Industry Act 1991.

125. - (1) Section 12 of the Water Industry Act 1991 (regulations relating to determinations under section 12(2)) is amended as follows.

(2) After subsection (3) there is inserted-

	"(3A) Subsections (4), (5), (7) and (7A) of section 14 below apply to references to the Competition Commission under this section as they apply to references under section 14.
	(3B) A report of the Competition Commission on a reference under this section-
	(a) shall be made to the Director; and
	(b) shall include definite conclusions on the questions or other matters comprised in the reference, together with such an account of their reasons for those conclusions as, in the opinion of the Competition Commission, is expedient for facilitating a proper understanding of those questions or other matters and of their conclusions;
	and subsections (5) and (6) of section 15 below apply to such a report as they apply to a report on a reference under section 14."

(3) Subsections (3)(b)(i), (4) and (5) shall cease to have effect.

Modification by Commission of licences following reports

Telecommunications licence conditions.

126. - (1) In section 12(7) of the Telecommunications Act 1984 (references to modifications of conditions not to include modifications of conditions relating to the telecommunications code) for "15" there is substituted "15A".

(2) In section 13(7) of that Act (licence modification references to Competition Commission) after "this section" there is inserted ", or in carrying out functions under section 16A,", after "the investigation" there is inserted "or the carrying out of those functions" and after "such investigation" there is inserted "or such functions".

(3) In section 15 of that Act (modification of licence conditions following report)-

(a) after subsection (4) there is inserted-

	"(4A) If, after considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Authority decides to make any modifications to remedy or prevent the adverse effects specified in the report, the Authority shall give notice to the Competition Commission setting out the modifications it proposes to make with a statement of the reasons for making the proposed modifications.
	(4B) The Authority shall include with the notice under subsection (4A)-
	(a) a copy of any representations or objections received in relation to the notice under subsection (3); and
	(b) such information (including information about any change in circumstances since the report was made) the Authority consider it is desirable for the Commission to have.
	(4C) If the period of four weeks from the date on which the notice under subsection (3) is given elapses without a direction under section 15A(1)(a) having been given to the Authority, the Authority shall-
	(a) make the modifications set out in the notice; or
	(b) if a direction under section 15A(1)(b) has been given, make the modifications which are not specified in the direction.";

(b) in subsection (5), for "subsection (3)" there is substituted "subsection (4A)" and for "the notice" there is substituted "subsection (4B)".

(4) After section 15 of that Act there is inserted-

"Competition Commission's power to veto modifications of licence conditions following report.	15A. - (1) The Competition Commission may, within the period of four weeks after the date on which it is given a notice under section 15(4A), direct the Authority-
	(a) not to make the modifications set out in that notice; or
	(b) not to make such of the modifications as may be specified in the direction;
	and the Authority shall comply with any such direction.
	(2) The Secretary of State may, within the period of four weeks after the date on which it is given a notice under section 15(4A) and on the application of the Commission, direct that the period for giving a direction under subsection (1) (and, accordingly, the period mentioned in section 15(4C)) shall be extended by 14 days.
	(3) The power to give a direction under subsection (1) may only be exercised where it appears to the Commission that the modifications set out in the notice under section 15(4A) are not requisite for the purpose of remedying or preventing all or any of the adverse effects specified in their report as effects which could be remedied or prevented by modifications.
	(4) If it gives a direction under subsection (1), the Commission-
	(a) shall give notice setting out the modifications proposed by the Authority, the terms of the direction and the reasons for giving it; and
	(b) may itself make such modifications as appear to it to be requisite for the purpose of remedying or preventing-
	(i) if the direction was given under subsection (1)(a), the adverse effects specified in the report as effects which could be remedied of prevented by modifications;
	(ii) if the direction was given under subsection (1)(b), such of those adverse effects as are not remedied or prevented by the modifications made by the Authority under section 15(4C)(b).
	(5) In determining whether to exercise the power under subsection (4)(b) or the manner in which to exercise it, the Commission shall have regard to the matters to which the Authority is required to have regard when determining the conditions of a licence.
	(6) Before making modifications under subsection (4)(b) the Commission shall give notice-
	(a) stating that it proposes to make the modifications and setting them out;
	(b) stating the reason why they propose to make them;
	(c) specifying the period (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,
	and shall consider any representations or objections which are duly made and not withdrawn.
	(7) A notice under subsection (4)(a) or (6) shall be given-
	(a) by publishing the notice in such manner as the Commission considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications; and
	(b) in the case of a licence granted to a particular person, by serving a copy on the holder of the licence.
	(8) The Commission shall also send a copy of a notice under subsection (7) to the Authority and the Secretary of State; and if, within the time specified in the notice, the Secretary of State directs the Commission not to make any modification the Commission shall comply with the direction.
	(9) A direction under subsection (8) shall not be given unless it appears to the Secretary of State requisite or expedient to do so in the interests of national security or relations with the government of a country or territory outside the United Kingdom.
	(10) After making modifications under this section the Commission shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.
	(11) This section does not apply to the modification of a licence following a report of the Commission made before the passing of the Utilities Act 2000."

Gas licence conditions.

127. - (1) In section 24(5) of the Gas Act 1986 (modification references to the Competition Commission), after "this section" there is inserted "or in carrying out functions under section 26A", after "the investigation" there is inserted "or the carrying out of those functions" and after "such investigation" there is inserted "or such functions".

(2) In section 25 of that Act (modification of licence conditions following report of Competition Commission) after subsection (4) there is inserted-

	"(4A) If, after considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Authority decides to make any modifications to remedy or prevent the adverse effects specified in the report, it shall give notice to the Competition Commission setting out the modifications it proposes to make with a statement of the reasons for making them.
	(4B) The Authority shall include a copy of any representations or objections received in relation to the notice under subsection (3).
	(4C) If the period of four weeks from the date on which the notice under subsection (3) is given elapses without a direction under section 25A(1)(a) having been given to him, the Authority shall-
	(a) make the modifications set out in the notice; or
	(b) if a direction under section 25A(1)(b) has been given, make the modifications which are not specified in the direction.";

(3) After section 25 of that Act there is inserted-

"Competition Commission's power to veto modifications following report.	25A. - (1) The Competition Commission (in this section referred to as "the Commission") may, within the period of four weeks after the date on which it is given a notice under section 25(4A), direct the Authority-
	(a) not to make the modifications set out in that notice; or
	(b) not to make such of the modifications as may be specified in the direction;
	and the Authority shall comply with any such direction.
	(2) The Secretary of State may, within the period of four weeks after the date on which the Commission is given a notice under section 25(4A) and on the application of the Commission, direct that the period for giving a direction under subsection (1) (and, accordingly, the period mentioned in section 25(4C)) shall be extended by 14 days.
	(3) The power to give a direction under subsection (1) may only be exercised where it appears to the Commission that the modifications set out in the notice under section 25(4A) are not requisite for the purpose of remedying or preventing all or any of the adverse effects specified in their report as effects which could be remedied or prevented by modifications.
	(4) If the Commission give a direction under subsection (1), the Commission-
	(a) shall give notice setting out the modifications proposed by the Authority, the terms of the direction and the reasons for giving it; and
	(b) may itself make such modifications as appear to it to be requisite for the purpose of remedying or preventing-
	(i) if the direction was given under subsection (1)(a), the adverse effects specified in the report as effects which could be remedied of prevented by modifications;
	(ii) if the direction was given under subsection (1)(b), such of those adverse effects as are not remedied or prevented by the modifications made by the Authority under section 25(4C)(b).
	(5) In determining whether to exercise the power under subsection (4)(b) or the manner in which to exercise it, the Commission shall have regard to the matters to which the Authority is required to have regard when determining the conditions of a licence.
	(6) Before making modifications under subsection (4)(b) the Commission shall give notice-
	(a) stating that it proposes to make the modifications and setting them out;
	(b) stating the reason why they propose to make them;
	(c) specifying the period (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,
	and shall consider any representations or objections which are duly made and not withdrawn.
	(7) A notice under subsection (4)(a) or (6) shall be given-
	(a) by publishing the notice in such manner as the Commission considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications; and
	(b) by serving a copy on the Authority and the holder of the licence in question.
	(8) After making modifications under this section the Commission shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.
	(9) This section does not apply to the modification of a licence following a report of the Commission made before the passing of the Utilities Act 2000."

Electricity licence conditions.

128. - (1) In section 12(6) of the Electricity Act 1989 (modification references to the Competition Commission), after "this section" there is inserted "or in carrying out functions under section 14A", after "the investigation" there is inserted "or the carrying out of those functions" and after "such investigation" there is inserted "or such functions".

(2) In section 13 of that Act (modification of licence conditions following report of Competition Commission) after subsection (4) there is inserted-

	"(4A) If, after considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Authority decides to make any modifications to remedy or prevent the adverse effects specified in the report, it shall give notice to the Competition Commission setting out the modifications it proposes to make with a statement of the reasons for making them.
	(4B) The Authority shall include with the notice under subsection (4A) a copy of any representations or objections received in relation to the notice under subsection (3).
	(4C) If the period of four weeks from the date on which the notice under subsection (3) is given elapses without a direction under section 16A(1)(a) having been given to him, the Authority shall-
	(a) make the modifications set out in the notice; or
	(b) if a direction under section 16A(1)(b) has been given, make the modifications which are not specified in the direction.";

(3) After section 14 of that Act there is inserted-

"Competition Commission's power to veto modifications following report.	14A. - (1) The Competition Commission (in this section referred to as "the Commission") may, within the period of four weeks after the date on which it is given a notice under section 14(4A), direct the Authority-
	(a) not to make the modifications set out in that notice; or
	(b) not to make such of the modifications as may be specified in the direction;
	and the Authority shall comply with any such direction.
	(2) The Secretary of State may, within the period of four weeks after the date on which the Commission is given a notice under section 14(4A) and on the application of the Commission, direct that the period for giving a direction under subsection (1) (and, accordingly, the period mentioned in section 14(4C)) shall be extended by 14 days.
	(3) The power to give a direction under subsection (1) may only be exercised where it appears to the Commission that the modifications set out in the notice under section 14(4A) are not requisite for the purpose of remedying or preventing all or any of the adverse effects specified in their report as effects which could be remedied or prevented by modifications.
	(4) If the Commission give a direction under subsection (1), the Commission-
	(a) shall give notice setting out the modifications proposed by the Authority, the terms of the direction and the reasons for giving it; and
	(b) may itself make such modifications as appear to it to be requisite for the purpose of remedying or preventing-
	(i) if the direction was given under subsection (1)(a), the adverse effects specified in the report as effects which could be remedied of prevented by modifications;
	(ii) if the direction was given under subsection (1)(b), such of those adverse effects as are not remedied or prevented by the modifications made by the Authority under section 15(4C)(b).
	(5) In determining whether to exercise the power under subsection (4)(b) or the manner in which to exercise it, the Commission shall have regard to the matters to which the Authority is required to have regard when determining the conditions of a licence.
	(6) Before making modifications under subsection (4)(b) the Commission shall give notice-
	(a) stating that it proposes to make the modifications and setting them out;
	(b) stating the reason why they propose to make them;
	(c) specifying the period (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,
	and shall consider any representations or objections which are duly made and not withdrawn.
	(7) A notice under subsection (4)(a) or (6) shall be given-
	(a) by publishing the notice in such manner as the Commission considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications; and
	(b) by serving a copy on the Authority and the holder of the licence in question.
	(8) After making modifications under this section the Commission shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.
	(9) This section does not apply to the modification of a licence following a report of the Commission made before the passing of the Utilities Act 2000."

Conditions of appointments under Water Industry Act 1991.

129. - (1) In section 14(5) of the Water Industry Act 1991 (modification references to the Competition Commission), after "this section" there is inserted "or in carrying out functions under section 16A", after "the investigation" there is inserted "or the carrying out of those functions" and after "such investigation" there is inserted "or such functions".

(2) In section 16 of that Act (modification of conditions of appointment following report of Competition Commission) after subsection (4) there is inserted-

	"(4A) If, after considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Director decides to make any modifications to remedy or prevent the adverse effects specified in the report, he shall give notice to the Competition Commission setting out the modifications he proposes to make with a statement of his reasons for making them.
	(4B) The Director shall include with the notice under subsection (4A) a copy of any representations or objections received in relation to the notice under subsection (3).
	(4C) If the period of four weeks from the date on which the notice under subsection (3) is given elapses without a direction under section 16A(1)(a) having been given to him, the Director shall-
	(a) make the modifications set out in the notice; or
	(b) if a direction under section 16A(1)(b) has been given, make the modifications which are not specified in the direction."

(3) After section 16 of that Act there is inserted-

"Competition Commission's power to veto modifications following report.	16A. - (1) The Competition Commission (in this section referred to as "the Commission") may, within the period of four weeks after the date on which it is given a notice under section 16(4A), direct the Director-
	(a) not to make the modifications set out in that notice; or
	(b) not to make such of the modifications as may be specified in the direction;
	and the Director shall comply with any such direction.
	(2) The Secretary of State may, within the period of four weeks after the date on which it is given a notice under section 16(4A) and on the application of the Commission, direct that the period for giving a direction under subsection (1) (and, accordingly, the period mentioned in section 16(4C)) shall be extended by 14 days.
	(3) The power to give a direction under subsection (1) may only be exercised where it appears to the Commission that the modifications set out in the notice under section 16(4A) are not requisite for the purpose of remedying or preventing all or any of the adverse effects specified in their report as effects which could be remedied or prevented by modifications.
	(4) If it gives a direction under subsection (1), the Commission-
	(a) shall give notice setting out the modifications proposed by the Director, the terms of the direction and the reasons for giving it; and
	(b) may itself make such modifications as appear to it to be requisite for the purpose of remedying or preventing-
	(i) if the direction was given under subsection (1)(a), the adverse effects specified in the report as effects which could be remedied of prevented by modifications;
	(ii) if the direction was given under subsection (1)(b), such of those adverse effects as are not remedied or prevented by the modifications made by the Director under section 15(4C)(b).
	(5) In determining whether to exercise the power under subsection (4)(b) or the manner in which to exercise it, the Commission shall have regard to the matters to which the Director is required to have regard when determining the conditions of a company's appointment.
	(6) Before making modifications under subsection (4)(b) the Commission shall give notice-
	(a) stating that it proposes to make the modifications and setting them out;
	(b) stating the reason why they propose to make them;
	(c) specifying the period (not being less than 28 days from the date of publication ) within which representations or objections with respect to the proposed modifications may be made,
	and shall consider any representations or objections which are duly made and not withdrawn.
	(7) A notice under subsection (4)(a) or (6) shall be given-
	(a) by publishing the notice in such manner as the Commission considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by the making of the modifications; and
	(b) by serving a copy on the Director and the company whose appointment it is proposed to modify.
	(8) The Commission may not make any modification under this section which the Director could not make under section 16.
	(9) After making modifications under this section the Commission shall publish a notice stating that the modifications have been made and setting them out, with the reasons for making them.
	(10) This section does not apply to the modification of the conditions of a company's appointment following a report of the Commission made before the passing of the Utilities Act 2000."

Extent of Part IV.

130. - (1) Section 124 extends to Northern Ireland.

(2) The amendments made by sections 125 to 129 have the same extent as the enactments being amended.

Prepared 21 January 2000