(b) where the application relates to a decision of an enforcement
authority on an application by the company under section
22A(7) above, within forty-two days from the date the company
is notified of the decision.
(3) On any such application, where the court considers it appropriate to do
so in all the circumstances of the case and is satisfied of one or more of
the grounds falling within subsection (4) below, the court—
(a) may quash the penalty;
(b) may substitute a penalty of such lesser amount as the court
considers appropriate in all the circumstances of the case; or
(c) in the case of an application under subsection (1)(c) above, may
substitute for the date or dates imposed by the enforcement
authority an alternative date or dates.
(4) The grounds falling within this subsection are—
(a) that the imposition of the penalty was not within the power of
the enforcement authority under section 22A above;
(b) that any of the requirements of subsections (4) to (6) or (8) of
section 22A above have not been complied with in relation to
the imposition of the penalty and the interests of the company
have been substantially prejudiced by the non-compliance; or
(c) that it was unreasonable of the enforcement authority to require
the penalty imposed, or any portion of it, to be paid by the date
or dates by which it was required to be paid.
(5) If an application is made under this section in relation to a penalty, the
penalty is not required to be paid until the application has been
(6) Where the court substitutes a penalty of a lesser amount it may require
the payment of interest on the substituted penalty at such rate, and
from such date, as it considers just and equitable.
(7) Where the court specifies as a date by which the penalty, or a portion of
the penalty, is to be paid a date before the determination of the
application under this section it may require the payment of interest on
the penalty, or portion, from that date at such rate as it considers just
(8) Except as provided by this section, the validity of a penalty shall not be
questioned by any legal proceedings whatever.
(9) In this section “the court” means the High Court.
22F Recovery of penalties
Where a penalty imposed under section 22A(1) or (2) above, or any
portion of it, has not been paid by the date on which it is required to be
(a) no application relating to the penalty has been made under
section 22E above during the period within which such an
application can be made; or
(b) an application has been made under that section and
the enforcement authority may recover from the company, as a civil
debt due to him or it, any of the penalty and any interest which has not
(2) In section 195 of the WIA (keeping of a register), in subsection (2), the “and” at
the end of paragraph (d) is omitted, and after paragraph (e) there is inserted—
“(f) every penalty imposed under section 22A(1) or (2) above and
every notice under section 22A(6) above;”.
48 Enforcement of certain provisions
(1) The WIA is amended as follows.
(2) In section 18 (orders for securing compliance with certain provisions)—
(a) in subsection (1)(b), for “has contravened any such condition or
requirement and is likely to do so again” there is substituted “is likely
to contravene any such condition or requirement”;
(b) for subsection (4)(a)(ii) there is substituted—
“(ii) is likely to contravene any such condition or
(3) In section 20 (procedure for orders made under section 18), in subsections (1)(c)
and (4)(b), for “twenty-eight” there is substituted “twenty-one”.
(4) Subsection (3) does not have effect in relation to—
(a) a provisional order which has been made before the commencement of
that subsection; or
(b) a final order in respect of which notice has been given under section
20(1) of the WIA before the commencement of that subsection.
Remuneration and standards of performance
49 Links between directors’ pay and standards of performance
After section 35 of the WIA there is inserted—
“Disclosure of arrangements for remuneration
35A Remuneration and standards of performance
(1) This section applies to any company holding an appointment under
Chapter 1 of this Part.
(2) As soon as reasonably practicable after the end of each financial year of
the company it must make a statement to the Authority—
(a) disclosing whether or not remuneration has been paid or
become due during that financial year to the directors of the
company as a result of arrangements falling within subsection
(3) below; and
(b) where such remuneration has been paid or become due,
describing the arrangements and the remuneration.
(3) Arrangements fall within this subsection if they are arrangements for
linking the remuneration of the directors of the company to standards
of performance in connection with the carrying out by the company of
the functions of a relevant undertaker.
(4) A description under subsection (2)(b) above must include in
(a) a statement of when the arrangements were made;
(b) a description of the standards of performance in question;
(c) an explanation of the means by which the standards of
performance are assessed; and
(d) an explanation of how the remuneration was calculated.
(5) The statement required by subsection (2) above must also state—
(a) whether or not there are in force in respect of the financial year
during which the statement is made arrangements falling
within subsection (3) above; or
(b) if not, whether the company intends that such arrangements
will be in force at some time during that financial year,
and if there are, or it is intended that there will be, such arrangements
in force the statement must describe those arrangements.
(6) A description under subsection (5) above must—
(a) include in particular the matters listed in subsection (4)(a), (b)
and (c) above; and
(b) where the arrangements described are different from any
arrangements described under subsection (2)(b) above, state the
likely effect of those differences on the remuneration of each
director of the company.
(7) The statement required by subsection (2) above must be made to the
Authority in such manner as may be required by the Authority.
(8) The statement required by subsection (2) above—
(a) must be published by the company making the statement in
such manner as it reasonably considers will secure adequate
publicity for it; and
(b) may be published by the Authority in such manner as it may
(9) The duty of a company under this section applies in respect of any
person who has at any time been a director of the company.
(10) In this section—
“remuneration” in relation to a director of a company—
(a) means any form of payment, consideration or other
benefit (including pension benefit), paid or due to or in
respect of the director; and
(b) includes remuneration in respect of any of his services
while a director of the company;
“standards of performance”, in relation to any company, include
any standards which are—
(a) set by or under any conditions of the company’s
appointment under Chapter 1 of this Part;
(b) contained in or prescribed by regulations made under
section 38(1)(b) or (2) or section 95(1)(b) or (2) below; or
(c) set or agreed to by the company.
(11) Any requirement imposed by this section shall be treated as a statutory
requirement enforceable under section 18 above by the Authority.”
50 Reasons for decisions
After section 195 of the WIA there is inserted—
“195A Reasons for decisions
(1) This section applies to the following decisions of the Authority, the
Secretary of State or the Assembly, namely—
(a) the modification of the conditions of an appointment under
Chapter 1 of Part 2 of this Act or the variation of the area to
which an appointment relates;
(b) the modification of the conditions of a licence under Chapter 1A
of that Part;
(c) the termination of such an appointment or the revocation of
such a licence;
(d) the giving of any directions or consent in pursuance of a
condition included in such an appointment by virtue of section
12(1) above or in such a licence by virtue of section 17G(3)(a) or
(e) the determination of a question referred in pursuance of a
condition included in such an appointment by virtue of section
12(2) above or in such a licence by virtue of section 17G(3)(c)
(f) the making of a determination under section 17E or 66D(1)
(g) the making of a final enforcement order, the making or
confirmation of a provisional enforcement order or the
revocation of a final order or of a provisional order which has
(2) As soon as reasonably practicable after making such a decision the
Authority, the Secretary of State or the Assembly shall publish a notice
stating the reasons for the decision in such manner as it considers
appropriate for the purpose of bringing the matters to which the notice
relates to the attention of persons likely to be interested.
(3) A person publishing a notice under subsection (2) above shall serve a
copy on the company holding the appointment or licence to which the
(4) A person preparing a notice under subsection (2) above shall have
regard to the need for excluding, so far as that is practicable, any matter
which relates to the affairs of a particular individual or body of persons
(corporate or unincorporate), where he considers that publication of
that matter would or might seriously and prejudicially affect the
interests of that individual or body.
(5) This section does not apply in relation to a decision of the Authority
resulting in any provision which the Authority was directed under
section 195(3) above not to enter in the register required to be kept
under that section.”
The Competition Commission
51 Specialist members of the Competition Commission
(1) In section 104(1) of the Utilities Act 2000 (c. 27) (appointment of members of the
(a) the “or” at the end of paragraph (a) is omitted, and
(b) after paragraph (b) there is inserted “; or
(c) section 12, 14, 16A, 17K or 17P of the Water Industry Act
(2) The persons who are, immediately before the commencement of subsection (1),
members of the Competition Commission by virtue of appointments made
under section 14(8) of the WIA shall continue as members of the Commission
and their appointments shall be treated as having been made under section 104
of the Utilities Act 2000.
(3) Section 14(8) and (8A) of the WIA (which are superseded by this section) shall
cease to have effect.
(4) The provision made by this section does not affect any group which has been
selected, before the commencement of subsection (1), to perform functions of
the Commission in relation to any reference under or by virtue of section 14 of
52 Determination references under section 12 of the WIA
(1) Section 12 of the WIA (determinations under conditions of appointment) is
amended as follows.
(2) After subsection (3) there is inserted—
“(3A) Subsections (4) and (5) of section 14, and sections 14A and 14B, 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
(a) shall be made to the Authority; 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.