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Utilities Bill - continued        House of Commons
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  PART III
  THE COMPETITION COMMISSION
 
Commission's functions under utilities legislation
Specialist members of the Competition Commission.     106. - (1) The Secretary of State shall appoint not less than six members of the Competition Commission ("the Commission") for the purpose of the exercise by the Commission of any function under or by virtue of-
 
 
    (a) section 24, 26A or 41E of the Gas Act 1986; or
 
    (b) section 12, 14A or 56C of the Electricity Act 1989.
      (2) In selecting a group to perform any function of the Commission under or by virtue of any provision mentioned in subsection (1), 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-paragraph (ii) there is substituted-
 
 
      "(ii) section 124 of the Utilities Act 2000;".
      (4) Section 12(9) and (9A) of the Electricity Act 1989 (which are superseded by this section) shall cease to have effect).
 
      (5) The persons who are, immediately before the commencement of this section, members of the Competition Commission by virtue of appointments made under section 12(9) of the Electricity Act 1989 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 24 of the Gas Act 1986 or section 12 of the Electricity Act 1989.
 
Gas licence conditions.     107. - (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 26 of that Act (modification of licence conditions following report of Competition Commission) after subsection (4) there is inserted-
 
 
    "(4A) After considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Authority shall give notice to the Competition Commission-
 
 
    (a) setting out the modifications it proposes to make to remedy or prevent the adverse effects specified in the report; and
 
    (b) stating the reasons for making the modifications.
      (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 (4A) is given elapses without a direction under section 26A(1)(a) having been given to it, the Authority shall-
 
 
    (a) make the modifications set out in the notice; or
 
    (b) if a direction under section 26A(1)(b) has been given, make the modifications which are not specified in the direction."
      (3) After section 26 of that Act there is inserted-
 
 
"Competition Commission's power to veto modifications following report.     26A. - (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 26(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 26(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 26(4C)) shall be extended by 14 days.
 
      (3) The power to give a direction under subsection (1) may only be exercised in respect of such of the modifications set out in the notice under section 26(4A)(a) as appear to the Commission not to be requisite for the purpose of remedying or preventing all or any of the adverse effects specified in the report as effects which could be remedied or prevented by modifications.
 
      (4) If the Commission 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) shall 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 or 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 26(4C)(b).
      (5) In exercising its function under subsection (4)(b) 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 it proposes 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) The provisions mentioned in subsection (10) are to apply in relation to the exercise by the Commission of its functions under this section as if-
 
 
    (a) in section 82(1) and (2) of the Fair Trading Act 1973 references to a report of the Commission under that Act were references to a notice under subsection (4)(a), (6) or (8) of this section;
 
    (b) in section 85 of that Act references to an investigation on a reference made to the Commission were references to an investigation by the Commission for the purposes of the exercise of its functions under this section.
      (10) The provisions are-
 
 
    (a) section 82(1) and (2) of the Fair Trading Act 1973 (general provisions as to reports under that Act);
 
    (b) section 85 of that Act (attendance of witnesses and production of documents);
 
    (c) section 24 of the Competition Act 1980 (modification of provisions about the Competition Commission's general functions); and
 
    (d) Part II of Schedule 7 to the Competition Act 1998 (the Competition Commission's general functions).
      (11) This section does not apply to the modification of a licence following a report of the Commission made before the commencement of section 107(3) of the Utilities Act 2000."
 
Electricity licence conditions.     108. - (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 14 of that Act (modification of licence conditions following report of Competition Commission) after subsection (4) there is inserted-
 
 
    "(4A) After considering any representations or objections made in response to proposals set out in a notice under subsection (3), the Authority shall give notice to the Competition Commission-
 
 
    (a) setting out the modifications it proposes to make to remedy or prevent the adverse effects specified in the report; and
 
    (b) stating the reasons for making the modifications.
      (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 (4A) is given elapses without a direction under section 14A(1)(a) having been given to it, the Authority shall-
 
 
    (a) make the modifications set out in the notice; or
 
    (b) if a direction under section 14A(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 in respect of such of the modifications set out in the notice under section 14(4A)(a) as appear to the Commission not to be requisite for the purpose of remedying or preventing all or any of the adverse effects specified in the report as effects which could be remedied or prevented by modifications.
 
      (4) If the Commission 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) shall 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 or 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 14(4C)(b).
      (5) In exercising its function under subsection (4)(b) 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 it proposes 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) The provisions mentioned in subsection (10) are to apply in relation to the exercise by the Commission of its functions under this section as if-
 
 
    (a) in section 82(1) and (2) of the Fair Trading Act 1973 references to a report of the Commission under that Act were references to a notice under subsection (4)(a), (6) or (8) of this section;
 
    (b) in section 85 of that Act references to an investigation on a reference made to the Commission were references to an investigation by the Commission for the purposes of the exercise of its functions under this section.
      (10) The provisions are-
 
 
    (a) section 82(1) and (2) of the Fair Trading Act 1973 (general provisions as to reports under that Act);
 
    (b) section 85 of that Act (attendance of witnesses and production of documents);
 
    (c) section 24 of the Competition Act 1980 (modification of provisions about the Competition Commission's general functions); and
 
    (d) Part II of Schedule 7 to the Competition Act 1998 (the Competition Commission's general functions).
      (11) This section does not apply to the modification of a licence following a report of the Commission made before the commencement of section 108(3) of the Utilities Act 2000."
 
Extent of Part III.     109. - (1) Section 106 extends to Northern Ireland.
 
      (2) The amendments made by sections 107 and 108 have the same extent as the enactments being amended.
 
 
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