Legalize / United Kingdom / Public General Act

Gas Act 1986

Type Public General Act

Publication 1986-07-25

Last updated 2025-11-13

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(d) that any securities of the successor company issued or allotted before the declaration of the distribution had been issued or allotted before the end of the relevant year; and

(e) such other assumptions (if any) as may appear to the directors of the successor company to be necessary or expedient for the purposes of this paragraph.

(3) For the purposes of the said accounts the amount to be included in respect of any item shall be determined as if anything done by the Corporation (whether by way of acquiring, revaluing or disposing of any asset or incurring, revaluing or discharging any liability, or by carrying any amount to any provision or reserve, or otherwise) had been done by the successor company.

Accordingly (but without prejudice to the generality of the preceding provision) the amount to be included in any reserves of the successor company as representing its accumulated realised profits shall be determined as if any profits realised and retained by the Corporation had been realised and retained by the successor company.

(4) The said accounts shall not be regarded as statutory accounts for the purposes of section 55 of this Act.

(5) In this paragraph—

“complete financial year” means a financial year ending with 31st March;

“the relevant year” means the last complete financial year of the Corporation ending before the transfer date;

“securities” has the same meaning as in Part II of this Act.

SCHEDULE 9

Part I — Repeals Coming into Force on Appointed Day

Part II — Repeals Coming into Force on Transfer Date

Part III — Repeals Coming into Force on Dissolution of British Gas Corporation

Acquisition of rights to use storage facilities.

4AA

(1) The principal objective of the Secretary of State and the Gas and Electricity Markets Authority (in this Act referred to as “the Authority”) in carrying out their respective functions under this Part is to protect the interests of existing and future consumers in relation to gas conveyed through pipes ....

(1A) Those interests of existing and future consumers are their interests taken as a whole, including—

(a) their interests in the Secretary of State’s compliance with the duties in sections 1 and 4(1)(b) of the Climate Change Act 2008 (net zero target for 2050 and five-year carbon budgets); ...

(b) their interests in the security of the supply of gas to them ; and

(c) their interests in the fulfilment by the Authority, when carrying out its designated regulatory functions, of the designated regulatory objectives.

(1B) The Secretary of State and the Authority shall carry out their respective functions under this Part in the manner which the Secretary of State or the Authority (as the case may be) considers is best calculated to further the principal objective, wherever appropriate by promoting effective competition between persons engaged in, or in commercial activities connected with, the shipping, transportation or supply of gas conveyed through pipes.

(1C) Before deciding to carry out functions under this Part in a particular manner with a view to promoting competition as mentioned in subsection (1B), the Secretary of State or the Authority shall consider—

(a) to what extent the interests referred to in subsection (1) of consumers would be protected by that manner of carrying out those functions; and

(b) whether there is any other manner (whether or not it would promote competition as mentioned in subsection (1B)) in which the Secretary of State or the Authority (as the case may be) could carry out those functions which would better protect those interests.

(2) In performing the duties under subsections (1B) and (1C), the Secretary of State or the Authority shall have regard to—

(a) the need to secure that, so far as it is economical to meet them, all reasonable demands in Great Britain for gas conveyed through pipes are met; and

(b) the need to secure that licence holders are able to finance the activities which are the subject of obligations imposed by or under this Part , the Utilities Act 2000 , Part 5 of the Energy Act 2008 or section 4, Part 2, , sections 26 to 29 of the Energy Act 2010, or Chapter 1 of Part 2, Chapters 2 and 3 of Part 4 and sections 245 to 247 of the Energy Act 2023 ; and

(3) In performing the duties under subsections (1B), (1C) and (2), the Secretary of State or the Authority shall have regard to the interests of—

(a) individuals who are disabled or chronically sick;

(b) individuals of pensionable age;

(d) individuals residing in rural areas;

but that is not to be taken as implying that regard may not be had to the interests of other descriptions of consumer.

(4) The Secretary of State and the Authority may, in carrying out any function under this Part, have regard to—

(a) the interests of consumers in relation to electricity conveyed by distribution systems or transmission systems (within the meaning of the Electricity Act 1989); and

(b) any interests of consumers in relation to—

(i) communications services and electronic communications apparatus, or

(ii) water services or sewerage services (within the meaning of the Water Industry Act 1991),

which are affected by the carrying out of that function.

(5) Subject to subsections (1B) and (2) and to section 132(2) of the Energy Act 2013 (duty to carry out functions in manner best calculated to further delivery of policy outcomes), the Secretary of State and the Authority shall carry out their respective functions under this Part in the manner which he or it considers is best calculated—

(a) to promote efficiency and economy on the part of persons authorised by licences or exemptions to carry on any activity, and the efficient use of gas conveyed through pipes;

(b) to protect the public from dangers arising from the conveyance of gas through pipes or from the use of gas conveyed through pipes or the provision of a smart meter communication service;

(ba) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

and ... shall have regard, in carrying out those functions, to the effect on the environment of activities connected with the conveyance of gas through pipes or the provision of a smart meter communication service.

(5A) In carrying out their respective functions under this Part in accordance with the preceding provisions of this section the Secretary of State and the Authority must each have regard to—

(a) the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed; and

(b) any other principles appearing to him or, as the case may be, it to represent the best regulatory practice.

(5B) In subsection (1A)—

“the designated regulatory objectives” means the objectives set out in Article 40(c) to (h) of the Gas Directive but read with the following modifications— in Article 40(c), for the words from “between” to the end substitute “ , including enabling the development of appropriate cross-border transmission capacities to meet demand; ”,in Article 40(d), omit “, in line with general energy policy objectives,”,in Article 40(f), omit “and foster market integration”, andin Article 40(g), for “their national market” substitute “the energy market in Great Britain”;

(6) In subsections (1C), (3) and (4) references to consumers include both existing and future consumers.

(7) In this section and sections 4AB and 4A, references to functions of the Secretary of State or the Authority under this Part include a reference to functions under the Utilities Act 2000 which relate to gas conveyed through pipes.

(8) In this Part, unless the context otherwise requires,—

“exemption” means an exemption granted under section 6A;

“licence” means a licence under section 7 , 7ZA , 7A , 7AA, 7AB or 7AC and “licence holder” shall be construed accordingly.

4AB

(1) The Secretary of State shall from time to time issue guidance about the making by the Authority of a contribution towards the attainment of any social or environmental policies set out or referred to in the guidance.

(2) The Authority shall, in carrying out its functions under this Part, have regard to any guidance issued under this section.

(3) Before issuing guidance under this section the Secretary of State shall consult—

(a) the Authority;

(b) Citizens Advice;

(ba) Consumer Scotland;

(d) such other persons as the Secretary of State considers it appropriate to consult in relation to the guidance.

(4) A draft of any guidance proposed to be issued under this section shall be laid before each House of Parliament.

(5) Guidance shall not be issued under this section until after the period of forty days beginning with—

(a) the day on which the draft is laid before each House of Parliament; or

(b) if the draft is laid before the House of Lords on one day and the House of Commons on another, the later of those two days.

(6) If, before the end of that period, either House resolves that the guidance should not be issued, the Secretary of State must not issue it.

(7) In reckoning any period of forty days for the purposes of subsection (5) or (6), no account shall be taken of any time during which—

(a) Parliament is dissolved or prorogued; or

(b) both Houses are adjourned for more than four days.

(8) The Secretary of State shall arrange for any guidance issued under this section to be published in such manner as he considers appropriate.

4A

(1) The Secretary of State and the Authority shall consult the Health and Safety Executive about all gas safety issues which may be relevant to the carrying out of any of their respective functions under this Part.

(2) The Secretary of State and the Authority shall, in carrying out their respective functions under this Part, take into account any advice given by the Health and Safety Executive about any gas safety issue (whether or not in response to consultation under subsection (1)).

(3) For the purposes of this section a gas safety issue is anything concerning the conveyance of gas through pipes, or the use of gas conveyed through pipes, which may affect the health and safety of—

(a) members of the public; or

(b) persons employed in connection with the conveyance of gas through pipes or the supply of gas conveyed through pipes.

4B

(1) Section 4AA does not apply in relation to the issuing by the Secretary of State of guidance under section 4AB.

(2) Sections 4AA to 4A do not apply in relation to anything done by the Authority—

(a) in the exercise of functions relating to the determination of disputes; or

(b) in the exercise of functions under section 36A(3).

(3) The Authority may nevertheless, when exercising any function under section 36A(3), have regard to any matter in respect of which a duty is imposed by sections 4AA to 4A if it is a matter to which the CMA could have regard when exercising that function.

(4) The duties imposed by sections 4AA to 4A do not affect the obligation of the Authority or the Secretary of State to perform or comply with any other duty or requirement (whether arising under this Act or another enactment, by virtue of any assimilated obligation or otherwise).

6A

(1) The Secretary of State may, ... by order grant exemption from paragraph (a), (aa), (b) , (c) , (d) or (e) of section 5(1) above—

(a) either to a person or to persons of a class;

(b) either generally or to such extent as may be specified in the order; and

(1A) Before making an order under subsection (1) the Secretary of State shall give notice—

(a) stating that he proposes to make such an order and setting out the terms of the proposed order;

(b) stating the reasons why he proposes to make the order in the terms proposed; and

(c) specifying the time (not being less than 28 days from the date of publication of the notice) within which representations with respect to the proposals may be made,

and shall consider any representations which are duly made in respect of the proposals and not withdrawn.

(1B) The notice required by subsection (1A) shall be given—

(a) by serving a copy of it on the Authority , Citizens Advice and Consumer Scotland; and

(b) by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of those likely to be affected by the proposed order.

(2) Notice of an exemption granted to a person shall be given—

(a) by serving a copy of the exemption on him; and

(b) by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of other persons who may be affected by it.

(2A) Notice of an exemption granted to persons of a class shall be given by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of—

(a) persons of that class; and

(b) other persons who may be affected by it.

(3) An exemption may be granted—

(a) indefinitely; or

(b) for a period specified in, or determined by or under, the exemption.

(4) Without prejudice to the generality of paragraph (c) of subsection (1) above, conditions included by virtue of that paragraph in an exemption may require any person carrying on any activity in pursuance of the exemption—

(a) to comply with any direction given by the Secretary of State or the Director as to such matters as are specified in the exemption or are of a description so specified;

(b) except in so far as the Secretary of State or the Director consents to his doing or not doing them, not to do or to do such things as are specified in the exemption or are of a description so specified; and

(c) to refer for determination by the Secretary of State or the Director such questions arising under the exemption as are specified in the exemption or are of a description so specified.

(5) The Secretary of State may by order revoke an order by which an exemption was granted to a person or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a) at the person’s request;

(b) in accordance with any provision of the order by which the exemption was granted; or

(6) The Secretary of State may by order revoke an order by which an exemption was granted to persons of a class or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a) in accordance with any provision of the order by which the exemption was granted; or

(b) if it appears to the Secretary of State inappropriate that the exemption should continue to have effect.

(7) The Secretary of State may by direction withdraw an exemption granted to persons of a class from any person of that class—

(a) at the person’s request;

(b) in accordance with any provision of the order by which the exemption was granted; or

(c) if it appears to the Secretary of State inappropriate that the exemption should continue to have effect in the case of the person.

(8) Before—

(a) making an order under subsection (5)(b) or (c) or (6); or

(b) giving a direction under subsection (7)(b) or (c),

the Secretary of State shall consult the Authority and give notice of his proposal to do so (with reasons) and of a period within which representations may be made to him.

(9) The notice under subsection (8) shall be given—

(a) where the Secretary of State is proposing to make an order under subsection (5)(b) or (c), by serving a copy of it on the person to whom the exemption was granted;

(b) where he is proposing to make an order under subsection (6), by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of persons of the class of persons to whom the exemption was granted; and

(c) where he is proposing to give a direction under subsection (7)(b) or (c), by serving a copy of it on the person from whom he proposes to withdraw the exemption.

7A

(1) Subject to subsection (3) below, the Director may grant a licence authorising any person to do either or both of the following, namely—

(a) to supply, to any premises specified in the licence, gas which has been conveyed through pipes to those premises; and

(b) to supply, to any premises at a rate which, at the time when he undertakes to give the supply, he reasonably expects to exceed 2,500 therms a year, gas which has been conveyed through pipes to those premises.

(2) Subject to subsection (3) below, the Director may grant a licence authorising any person to arrange with any gas transporter for gas to be introduced into, conveyed by means of or taken out of a pipe-line system operated by that transporter, either generally or for purposes connected with the supply of gas to any premises specified in the licence.

(3) A licence shall not be granted under this section to a person who is the holder of a licence under section 7 or 7ZA above.

(4) The Director may, with the consent of the licence holder, direct that any licence under this section shall have effect—

(a) as if any premises specified in the direction were specified in the licence; or

(b) in the case of a licence under subsection (1)(b) above, as if it were also a licence under subsection (1)(a) above and any premises specified in the direction were specified in the licence,

and references in this Part to, or to the grant of, an extension under this section, or an extension of such a licence, shall be construed as references to, or to the giving of, such a direction.

(5) Subsection (4) above shall not apply in relation to a licence under subsection (1) above which authorises only the supply to premises of gas which has been conveyed to the premises otherwise than by a gas transporter.

(6) The Director may, with the consent of the licence holder, direct that any licence under this section shall have effect as if any premises specified in the direction were not specified in the licence; and references in this Part to, or to the grant of, a restriction under this section, or a restriction of such a licence, shall be construed as references to, or to the giving of, such a direction.

(7) In this section references to premises specified in a licence or direction include references to premises of a description, or situated in an area, so specified.

(8) The Director shall not, in any licence under subsection (1) above, or in any extension or restriction of such a licence, specify any premises by description or area if he is of the opinion that the description or area has been so framed as—

(a) in the case of a licence or extension, artificially to exclude from the licence or extension; or

(b) in the case of a restriction, artificially to include in the restriction,

premises likely to be owned or occupied by persons who are chronically sick, disabled or of pensionable age, or who are likely to default in the payment of charges.

(9) If the holder of a licence under subsection (1) above applies to the Director for a restriction of the licence, or for the revocation of the licence in accordance with any term contained in it, the Director shall, subject to subsection (8) above, accede to the application if he is satisfied that such arrangements have been made as—

(a) will secure continuity of supply for all relevant consumers; and

(b) in the case of each such consumer who is supplied with gas in pursuance of a contract, will secure such continuity on the same terms as nearly as may be as the terms of the contract.

(10) A person is a relevant consumer for the purposes of subsection (9) above if—

(a) immediately before the restriction or revocation takes effect, he is being supplied with gas by the holder of the licence; and

(b) in the case of a restriction, his premises are excluded from the licence by the restriction;

and in that subsection “contract” does not include any contract which, by virtue of paragraph 8 of Schedule 2B to this Act, is deemed to have been made.

(11) In this Part “gas supplier” and “gas shipper” mean respectively the holder of a licence under subsection (1) above, and the holder of a licence under subsection (2) above, except (in either case) where the holder is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence.

(12) Any reference in this Part (however expressed) to activities authorised by a licence under subsection (1) above shall be construed without regard to any exception contained in Schedule 2A to this Act.

7B

(1) An application for a licence or an extension or restriction of a licence shall be made in such form and manner, and shall contain, or be accompanied by, such information and documents and such fee (if any), as may be prescribed.

(2) Within the prescribed period after the making of an application for a licence or an extension or restriction of a licence, the applicant shall—

(a) publish a notice of the application in the prescribed manner; and

(b) in the case of an application for a licence or extension under section 7 above, give notice of the application to any gas transporters whose authorised area includes the whole or any part of the area to which the application relates.

(2A) Where the Authority proposes to refuse the application, it shall give to the applicant a notice—

(a) stating that it proposes to refuse the application;

(b) stating the reasons why it proposes to refuse the application; and

and shall consider any representations which are duly made and not withdrawn.

(2B) At any time when regulations made under section 41HC are in force, subsections (1) to (2A) do not apply to an application for a smart meter communication licence.

(2C) Subsections (1) to (2A) do not apply to an application for a code manager licence.

(3) A licence or an extension or restriction of a licence shall be in writing and, unless revoked or suspended in accordance with any term contained in it and subject to subsection (3A), a licence shall continue in force for such period as may be specified in or determined by or under the licence.

(3A) If a person who holds a gas system planner licence ceases at any time to hold a licence under section 6(1)(da) of the Electricity Act 1989, the person is to be treated as ceasing to hold the gas system planner licence at the same time.

(4) A licence may include—

(a) such conditions (whether or not relating to the activities authorised by the licence) as appear to the grantor to be requisite or expedient having regard to the duties imposed by sections 4AA, 4AB and 4A;

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) conditions requiring the rendering to the Director of a payment on the grant of the licence or payments during the currency of the licence or both of such amount or amounts as may be determined by or under the licence; . . .

(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4A) Without prejudice to the generality of paragraph (a) of subsection (4), conditions included in a licence under section 7 by virtue of that paragraph—

(a) may require the licence holder to enter into agreements with other persons for the use of any pipe-line system of his (wherever situated and whether or not used for the purpose of carrying on the activities authorised by the licence) for such purposes as may be specified in the conditions;

(b) may include provision for determining the terms on which such agreements are to be entered into.

(5) Without prejudice to the generality of paragraph (a) of subsection (4) above—

(a) conditions included by virtue of that paragraph in a licence may—

(i) require the holder to comply with any direction given by the Director or the Secretary of State as to such matters as are specified in the licence or are of a description so specified;

(ii) require the holder, except in so far as the Director or the Secretary of State consents to his doing or not doing them, not to do or to do such things as are specified in the licence or are of a description so specified; and

(iii) provide for the determination by the Director, the Secretary of State or the Health and Safety Executive of such questions arising under the licence, or under any document referred to in the licence, as are specified in the licence or are of a description so specified; and

(b) conditions included by virtue of that paragraph in a licence under section 7 or 7AA above may require the holder, in such circumstances as are specified in the licence—

(i) so to increase the charges payable to the holder in connection with the conveyance of gas, or in connection with the exercise of any other functions under or by virtue of the licence, as to raise such amounts as may be determined by or under the conditions; and

(ii) to pay the amounts so raised to such holders of licences under this Part or under section 6 of the Electricity Act 1989 as may be so determined.

(5ZA) Without prejudice to the generality of paragraph (a) of subsection (4), conditions for or in connection with the purpose set out in subsection (5ZB) may be included in a licence under section 7AA by virtue of that paragraph.

(5ZB) The purpose is to facilitate or ensure the effective performance (whether in relation to Northern Ireland or any other part of the United Kingdom), at relevant times, of functions of a hydrogen production allocation body under Chapter 1 of Part 2 of the Energy Act 2023.

(5ZC) In subsection (5ZB) “relevant times” means times when the hydrogen production allocation body holds a licence under section 7AA.

(5A) Without prejudice to the generality of paragraph (a) of subsection (4), conditions which are described in subsection (5B) may be included in a smart meter communication licence or in a code manager licence by virtue of that paragraph, in respect of circumstances where a person holds such a licence (the “licence holder”), and another person has applied or is considering whether to apply for a a licence of the same type (“the applicant”).

(5B) The conditions in this subsection are conditions which require the licence holder to comply with a direction given by the relevant authority requiring the licence holder to provide to the applicant—

(a) information in relation to the activities authorised by the licence; or

(b) such other assistance as may be reasonably required by the applicant, including access to any facilities or equipment being used in connection with the activities authorised by the licence, in order that the applicant can—

(i) determine whether to apply for a licence; or

(ii) take part in a competition for a licence or (in the case of an application for a code manager licence) apply for a licence otherwise than as part of a competition.

(5C) Subject to subsection (5E) and without prejudice to the generality of paragraph (a) of subsection (4), conditions which are described in subsection (5D) may be included in a smart meter communication licence or in a code manager licence by virtue of that paragraph, in respect of circumstances where such a licence held by a person (the “first licensee”) will cease to have effect, and another such licence is to be granted or has been granted to a different person (the “second licensee”).

(5D) The conditions in this subsection are conditions which require compliance with a direction given by the relevant authority requiring—

(a) the transfer of property, rights or liabilities from the first licensee to the second licensee;

(b) the creation of rights in relation to property, rights or liabilities in favour of the second licensee;

(d) the first or second licensee to enter into a written agreement with each other, or the first licensee to execute an instrument of another kind in favour of the second licensee;

(e) the first or second licensee to pay compensation to the other, or to any third party who is affected by any of the matters referred to in paragraphs (a) to (d).

(5E) Conditions included in a licence by virtue of subsection (5C) must provide that the licensee does not have a duty to comply with a direction of the kind referred to in subsection (5D) unless, in relation to that direction, the following conditions have been satisfied prior to it being given—

(a) the relevant authority has given written notice to the first licensee, the second licensee and any other person who would potentially be affected by the direction, including a copy of the proposed direction and inviting them to submit written representations, giving a minimum period of 21 days in which those representations can be made; and

(b) after the end of the period set out in the notice under paragraph (a), the relevant authority has considered those representations and determined that—

(i) it is appropriate in all the circumstances that the proposed direction is given; and

(ii) the arrangements of a type referred to in paragraphs (a) to (d) of subsection (5D) in the direction are necessary or expedient for the operational purposes of the second licensee, or are agreed by the first licensee and the second licensee to be necessary or expedient for those purposes.

(5F) For the purposes of subsection (5E), the operational purposes of the second licensee are the purposes of performing any functions which the second licensee has, or will have—

(a) under or by virtue of the smart meter communication licence which has been, or is to be, granted; or

(b) under or by virtue of any enactment, in the second licensee’s capacity as holder of that licence.

(5FA) In subsections (5B) to (5E), “the relevant authority” means—

(a) in relation to a smart meter communication licence, the Secretary of State or the Authority;

(b) in relation to a code manager licence, the Authority.

(6) Conditions included in a licence may—

(a) impose requirements by reference to designation, acceptance or approval by the Director, the Secretary of State or the Health and Safety Executive; and

(b) provide for references in the conditions to any document . . . to operate as references to that document as revised or re-issued from time to time.

(7) Conditions included in a licence may contain provision for the conditions to—

(a) have effect or cease to have effect at such times and in such circumstances as may be determined by or under the conditions; or

(b) be modified in such manner as may be specified in the conditions at such times and in such circumstances as may be so determined.

(8) Any provision included in a licence by virtue of subsection (7) above shall have effect in addition to the provision made by this Part with respect to the modification of the conditions of a licence.

(9) As soon as practicable after granting a licence or an extension or restriction of a licence, the Director shall send a copy of the licence or extension or restriction—

(a) to the Health and Safety Executive; . . .

(b) in the case of a licence , extension or restriction under section 7 above, to any public gas transporter whose authorised area includes the whole or any part of the area specified in the licence , extension or restriction ; and

(c) to any other person who holds a licence and whose interests may, in the opinion of the Authority, be affected by the grant.

(10) Any sums received by the Director under or by virtue of this section shall be paid into the Consolidated Fund.

(11) In this section “prescribed” means prescribed in regulations made by the Authority.

8AA

(1) A licence—

(a) shall be capable of being transferred by the licence holder, with the consent of the Authority, in accordance with this section and subject to any term of the licence relating to its transfer;

(b) may include conditions which must be complied with before the licence can be transferred.

(2) A transfer may relate to the whole or any part of the licence.

(3) The reference in subsection (2) to part of a licence is a reference to a part of the activities authorised by the licence (whether described by reference to activities being carried on by the licence holder or to activities which he is authorised to carry on).

(4) Such consent may be given subject to compliance with such modification or other conditions as the Authority considers necessary or expedient.

(5) In the case of a partial transfer, conditions imposed under subsection (4) may make as respects so much of the licence as is proposed to be retained by the transferor provision different from that made as respects so much of the licence as is proposed to be transferred.

(6) In deciding whether to give its consent to a proposed transfer, the Authority shall apply the same criteria as it would apply if the Authority were deciding whether—

(a) in the case of a general transfer, to grant a corresponding licence to the transferee; or

(b) in the case of a partial transfer—

(i) to grant to the transferee a licence corresponding to so much of the licence as is proposed to be transferred; and

(ii) to grant to the transferor a licence corresponding to so much of the licence as is proposed to be retained.

(7) The Authority shall—

(a) give the Health and Safety Executive not less than 28 days’ notice of any proposal to consent to any proposed transfer; and

(b) give that Executive and the Secretary of State not less than 28 days’ notice of any proposal to impose a modification condition.

(8) If, before the expiry of the time specified in a notice given to the Secretary of State under subsection (7)(b), the Secretary of State directs the Authority not to impose the condition, the Authority shall comply with the direction.

(9) Before giving consent to the transfer of a licence, the Authority shall give notice—

(a) stating that it proposes to grant consent to the transfer;

(b) stating the reasons why it proposes to give consent; and

(c) specifying the time from the date of publication of the notice (not being less than two months) within which representations or objections with respect to the transfer may be made,

and shall consider any representations or objections that are duly made and not withdrawn.

(10) A notice under subsection (9) shall be given by publishing the notice in such manner as the Authority considers appropriate for bringing it to the attention of persons likely to be affected by the transfer.

(10A) Subject to subsection (10C), the Authority shall, following consideration of any representations or objections under subsection (9), give the Secretary of State not less than 28 days’ notice of any proposal to give consent to the transfer of the whole or any part of a smart meter communication licence.

(10B) If, before the expiry of the time specified in a notice under subsection (10A), the Secretary of State directs the Authority not to give consent, the Authority shall comply with that direction.

(10C) Where the Secretary of State does not give a direction under subsection (10B), the Authority may give consent to the transfer of the licence after—

(a) the expiry of the time specified in the notice under subsection (10A); or

(b) if earlier than the time in paragraph (a), the time at which the Secretary of State informs the Authority that no direction will be given under subsection (10B) in relation to the notice.

(10D) Subsections (10A) to (10C) do not apply after 1 November 2028.

(11) A purported transfer of a licence shall be void—

(a) if the licence is not capable of transfer or the Authority has not given its consent;

(b) if the purported transfer is in breach of a condition of the licence; or

(c) if there has, before the purported transfer, been a contravention of a condition subject to compliance with which the Authority’s consent is given.

(11ZA) A gas system planner licence may not be transferred to a person unless a licence granted under section 6(1)(da) of the Electricity Act 1989 is also transferred to the same person at the same time.

(11A) A smart meter communication licence may not be transferred to a person unless a licence granted under section 6(1)(f) of the Electricity Act 1989 is also transferred to the same person at the same time.

(11B) Where the holder of a code manager licence is also the holder of a licence under section 6(1)(g) of the Electricity Act 1989, the code manager licence may not be transferred to a person unless the licence under section 6(1)(g) of that Act is transferred to the same person at the same time.

(12) In this section—

“transfer” includes any form of transfer or assignment or, in Scotland, assignation;

“modification condition” means a condition requiring or otherwise providing for the making of modifications to the conditions of a licence.

8A

(1) The Secretary of State may by order amend section 10(8) or (12) below, paragraph 4 of Schedule 2A to this Act or paragraph 4, 8 or 16 of Schedule 2B to this Act by substituting—

(a) where the limit is for the time being expressed by reference to a number of therms—

(i) such lower number of therms as he considers appropriate; or

(ii) such lower limit, expressed by reference to a number of kilowatt hours, as he considers appropriate; or

(b) where the limit is for the time being expressed by reference to a number of kilowatt hours, such lower number of kilowatt hours as he considers appropriate.

(2) An order under subsection (1) above may be made so as to provide for the number specified in one provision to differ from that for the time being specified in any of the other provisions.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The gas code

8B

The provisions of Schedule 2B to this Act (which relate to rights and obligations of licence holders and consumers and related matters) shall have effect.

10A

(1) Any pipe-line of a gas transporter—

(a) for the construction of which the execution of works has begun before the commencement of section 76 of the Utilities Act 2000 (abolition of geographical exclusivity of authorised areas of gas transporters); and

(b) which is situated in an area which, immediately before the commencement of that section, is the authorised area of a public gas transporter (the “other transporter”),

shall not be used for the purpose of giving a supply of gas to any premises in that area at a rate less than 2,196,000 kilowatt hours per year unless the other transporter consents in writing to such use.

(2) If the other transporter refuses or fails to give consent under subsection (1) consent may instead be given in writing by the Authority where it considers it appropriate to do so.

(3) Consent given under this section may not be withdrawn.

(4) In this section “pipe-line” has the same meaning as in the Pipe-lines Act 1962.

Gas conveyed by Public Gas Transporters

14A

16

(1) The Authority may, with the consent of the Secretary of State, prescribe—

(a) standards of pressure and purity to be complied with by gas transporters in conveying gas to premises or to pipe-line systems operated by other gas transporters; and

(b) other standards with respect to the properties, condition and composition of gas so conveyed.

(2) Before making any regulations under this section the Authority shall consult such persons and organisations as it considers appropriate and such gas transporters as appear to it to be affected by the regulations.

(3) The Authority shall appoint competent and impartial persons for the purpose of—

(a) carrying out tests of gas, apparatus or equipment in accordance with regulations under this section; and

(b) assisting the Authority in exercising functions under this section and regulations made under it.

(4) Regulations under this section may make provision—

(a) for requiring tests of gas conveyed by gas transporters to be carried out by persons appointed under subsection (3) or by gas transporters for the purpose of ascertaining whether the gas conforms with the standards prescribed by the regulations;

(b) for requiring such tests to be carried out on the basis of samples taken by persons appointed under subsection (3) or by gas transporters; and

(c) for requiring samples of gas taken under paragraph (b) to be provided by gas transporters for the purpose of carrying out such tests.

(5) Regulations under this section may make provision—

(a) for requiring such premises, apparatus and equipment as the Authority may direct to be provided and maintained by gas transporters for the purpose of carrying out tests required under subsection (4)(a);

(b) for requiring tests of apparatus and equipment so provided to be carried out by persons appointed under subsection (3); and

(6) Regulations under this section may make provision—

(a) as to the places or premises and the times at which, and the manner in which—

(i) tests under this section are to be carried out;

(ii) samples of gas are to be taken and provided under this section; and

(iii) results of tests under this section are to be notified or made available;

(b) for the Authority to require by direction any matter which may be required by regulations by virtue of paragraph (a);

(c) for persons representing the gas transporter concerned to be present during the carrying out of any tests carried out by persons appointed under subsection (3);

(d) for the results of tests under this section to be made available to other licence holders and to the public;

(e) for requiring gas transporters to notify the results of such tests carried out by them to the Authority or to any person appointed under subsection (3);

(f) for conferring powers of entry on property owned or occupied by gas transporters for the purpose of carrying out tests under this section and otherwise for the purposes of the regulations.

(7) Subject to subsection (8), the Authority may by notice in writing require a gas transporter to give to the Authority, or to any person appointed by it for the purpose, within such time and at such place as may be specified in the notice, such information as the Authority may reasonably require for the purpose of making regulations under this section or of giving directions under such regulations.

(8) A gas transporter shall not be required under subsection (7) to give any information which he could not be compelled to give in evidence in civil proceedings before the High Court or, in Scotland, the Court of Session.

(9) Every person who is a gas transporter during any period shall pay to the Authority such proportion as the Authority may determine of such part of its expenses for that period as the Authority may determine to be attributable to its functions in connection with the testing of gas for the purposes of this section.

(10) It shall be the duty of every gas transporter to conduct his business in such a way as can reasonably be expected to secure compliance with the standards set under subsection (1).

15B

16 18A

(1) The Secretary of State may by regulations make provision—

(a) for empowering any officer authorised by a gas transporter, if the transporter has reasonable cause to suspect—

(i) that gas conveyed by the transporter is escaping, or may escape, in any premises; or

(ii) that gas so conveyed which has escaped has entered, or may enter, any premises,

to enter the premises, to carry out any work necessary to prevent the escape of gas and to take any other steps necessary to avert danger to life or property; and

(b) for empowering any officer so authorised, if the transporter has reasonable cause to suspect—

(i) that gas conveyed through pipes by some other person is escaping, or may escape, in any premises; or

(ii) that gas so conveyed which has escaped has entered, or may enter, any premises,

to enter the premises and take any steps necessary to avert danger to life or property.

(2) Subsections (5) to (7) and (11) of section 18 above shall apply for the purposes of this section as if—

(a) any reference to subsection (2) of that section were a reference to subsection (1) above;

(b) any reference to the relevant authority were a reference to a gas transporter;

(c) any reference to subsection (5) of that section were a reference to that subsection as applied by this subsection; and

(d) the reference in subsection (11) of that section to regulations under that section were a reference to regulations under this section.

(3) The Rights of Entry (Gas and Electricity Boards) Act 1954 (entry under a justice’s warrant) shall apply in relation to any powers of entry conferred by regulations made under subsection (1) above.

(4) Any reference in this section to any officer authorised by a gas transporter includes a reference to any officer authorised by another such transporter with whom the transporter has made arrangements for officers authorised by the other transporter to discharge any functions under this section of officers authorised by the transporter.

19A

(1) Section 19B applies to a storage facility, except as provided in subsections (1A) and (1B).

(1A) Section 19B does not apply to a storage facility if it is subject to a minor facility exemption under section 8S.

(1B) Section 19B does not apply to a storage facility if, or to the extent that, it is exempt under this section.

(1C) The Authority must maintain on its website a list of the facilities to which section 19B applies.

(1D) If only part of the capacity of a storage facility is exempt under this section, the list under subsection (1C) must specify the extent to which section 19B applies to the facility.

(2) A person who is or expects to be an owner of a storage facility may apply in writing to the Director for an exemption under this section with respect to the facility.

(2A) An application under subsection (2) must relate to—

(a) a storage facility (or proposed storage facility) which is not yet operational; or

(b) a modification (or proposed modification) which falls within subsection (2B) and is not yet operational.

(2B) A modification (or proposed modification) falls within this subsection if it is—

(a) a modification of a storage facility to provide for a significant increase in the capacity of the facility; or

(b) a modification of a storage facility to enable the development of new sources of gas supply.

(2C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) An exemption under this section must be given in writing and on the following terms—

(a) a term specifying the period of the exemption, or specifying how that period is to be determined;

(b) a term as to whether the exemption applies to all of the capacity of the facility or part of that capacity only;

(c) a term that the owner must comply with the capacity allocation mechanism approved in accordance with section 19DB; and

(d) such other terms regarding non-discriminatory access to the facility or any other matter as the Authority considers appropriate.

(3A) When determining a term under subsection (3) the Authority must take into account—

(a) the capacity of the facility or (as the case may be) the increase in capacity of the facility;

(b) the length of time required to recover the investment in the facility or (as the case may be) the investment in the modification;

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) Where the Authority receives an application under subsection (2) in relation to a facility or modification, it must give an exemption if it is satisfied that —

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) the requirements of subsection (8) are met.

(6A) An exemption given in accordance with subsection (6) may apply to all of the capacity of the facility concerned or to part of that capacity only, regardless of the extent of the exemption applied for; but this is subject to subsection (7).

(7) In respect of a facility which is or is to be modified to provide for a significant increase in its capacity, an exemption by virtue of subsection (6)(b) may only be given in relation to that increase in its capacity or part of that increase in its capacity.

(7A) When deciding whether the requirements of subsection (8)(a), (d) and (e) are met, the Authority must take into account the way in which capacity is to be allocated under the capacity allocation mechanism approved in accordance with section 19DB.

(8) The requirements of this subsection are that—

(a) the facility or (as the case may be) the modification will promote security of supply;

(b) the level of risk is such that the investment to construct the facility or (as the case may be) to modify the facility ... would not be or would not have been made without the exemption;

(c) the facility is or is to be owned by a person other than the gas transporter who operates or will operate the pipeline system connected or to be connected to the facility;

(d) charges will be levied on users of the facility or (as the case may) the increase in its capacity; and

(e) the exemption will not be detrimental to competition, the operation of an economically efficient gas market or the efficient functioning of the pipeline system connected or to be connected to the facility.

(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9) Subject to subsections (9A) and (10), an exemption may not be given by virtue of subsection (6)(b) more than once in respect of the same facility.

(9A) Subsection (9) does not prevent a further exemption being given by virtue of subsection (6)(b) in respect of a facility if the previous exemption given by virtue of that provision in respect of the facility has been revoked under section 19AA(5).

(10) Subsection (9) does not prevent a further exemption being given by virtue of subsection (6)(b) in respect of a facility if—

the facility is or is to be modified to provide for a significant increase in its capacity or to enable the development of new sources of gas supply;

the exemption has effect only in relation to that modification; and

no previous exemption has been given by virtue of subsection (6)(b) in relation to that modification.

(11) The Authority shall publish its decision to give or refuse to give an exemption under this section, together with the reasons for its decision, in such manner as it considers appropriate.

(12) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19B

(1) The owner of a storage facility to which this section applies (a “relevant facility”)—

(a) shall publish at least once in every year the main commercial conditions relating to the grant to another person of a right to have gas or liquid gas stored in the facility on that person’s behalf; and

(b) shall publish any changes to the published conditions as soon as they become effective.

(2) In subsection (1) “year” means any year ending with 9th August.

(3) The owner of a relevant facility shall ensure that the conditions which he is required to publish under subsection (1) do not discriminate against any applicants or descriptions of applicants, or any potential applicants or descriptions of potential applicants, for a right to have gas or liquid gas stored in the facility.

(3A) At least 2 months before publishing the main commercial conditions, or any changes to the published conditions, under subsection (1), the owner of a relevant facility must—

(a) publish a draft of the proposed conditions or changes; and

(b) inform any person who has a right to have gas stored in the facility that the draft has been published.

(3B) When finalising conditions or changes under subsection (1), the owner of a relevant facility must take into account any representations it has received about the proposed conditions or changes.

(4) Any person who seeks a right to have gas or liquid gas stored on his behalf in a relevant facility (“the applicant”) shall, before making an application to the Director under subsection (8), apply to the owner of the facility for the right.

(5) An application under subsection (4) shall be made by giving notice to the owner specifying what is being sought.

(6) Such a notice shall, in particular, specify—

(a) the period during which the gas or liquid gas is to be stored in the facility;

(b) the kind of gas or liquid gas to be stored (which must be of, or similar to, the kind which the facility is designed to store); and

(7) Where an applicant gives notice under subsection (5), he and the owner of the facility shall negotiate in good faith and endeavour to reach agreement on the application.

(8) If the owner and the applicant do not reach any such agreement, the applicant may apply to the Director for directions under subsection (11) which would secure to the applicant the right specified in the notice under subsection (5).

(9) The Director shall not entertain an application under subsection (8) unless he is satisfied that the parties have had a reasonable time in which to fulfil their duties under subsection (7).

(10) Where a person applies to the Director under subsection (8) and the Director is satisfied as mentioned in subsection (9), the Director shall—

(a) decide whether the application is to be adjourned (so as to enable further negotiations to take place), considered further or rejected;

(b) give notice of his decision to the applicant; and

(c) in the case of a decision that the application is to be considered further, give to the owner of the facility, the Health and Safety Executive and any person who has a right to have gas or liquid gas stored in the facility notice that the application is to be so considered and an opportunity of being heard on the matter.

(11) Where, after considering an application under subsection (8), the Director is satisfied that the giving of directions under this subsection would not prejudice the efficient operation of the facility, or the storage in the facility of—

(a) the quantities of gas or liquid gas which the owner of the facility requires or may reasonably be expected to require to be stored in the facility; and

(b) the quantities of gas or liquid gas which any person who has a right to have gas or liquid gas stored in the facility is entitled to require to be so stored in the exercise of that right;

the Director may give such directions to the owner of the facility.

(12) Directions under subsection (11) may—

(a) specify the terms on which the Director considers the owner of the facility should enter into an agreement with the applicant for all or any of the following purposes—

(i) for securing to the applicant the right to have stored in the facility, for the period specified in the directions and in the quantities so specified or determined by or under the directions, gas or liquid gas which is of a kind so specified;

(ii) for securing that the exercise of that right is not prevented or impeded;

(iii) for regulating the charges which may be made for the storage of gas or liquid gas by virtue of that right;

(iv) for securing to the applicant such ancillary or incidental rights as the Director considers necessary or expedient (which may include, in particular, a right to have a pipeline of his connected to the facility by the owner);

(b) specify the sums or the method of determining the sums which the Director considers should be paid by way of consideration for any such right; and

(c) require the owner, if the applicant pays or agrees to pay those sums within a period specified in that behalf in the directions, to enter into an agreement with him on the terms so specified.

19C

(1) Section 19D applies to an LNG import or export facility, except as provided in subsections (1A) and (1B).

(1A) Section 19D does not apply to an LNG import or export facility if, or to the extent that, it is exempt under this section.

(1B) Section 19D does not apply to an LNG import or export facility if it is exempt under section 19DZA.

(2) A person who is or expects to be an owner of an LNG import or export facility may apply in writing to the Director for an exemption under this section with respect to the facility.

(2A) An application under subsection (2) must relate to—

(a) a facility (or proposed facility) which is not yet operational; or

(b) a modification (or proposed modification) which falls within subsection (2B) and is not yet operational.

(2B) A modification (or proposed modification) falls within this subsection if it is—

(a) a modification of an LNG import or export facility to provide for a significant increase in the capacity of the facility; or

(b) a modification of an LNG import or export facility to enable the development of new sources of gas supply.

(2C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) An exemption under this section must be given in writing and on the following terms—

(a) a term specifying the period of the exemption, or specifying how that period is to be determined;

(b) a term as to whether the exemption applies to all of the capacity of the facility or part of that capacity only;

(c) a term that the owner must comply with the capacity allocation mechanism approved in accordance with section 19DB; and

(d) such other terms regarding non-discriminatory access to the facility or any other matter as the Authority considers appropriate.

(3A) When determining a term under subsection (3) the Authority must take into account—

(a) the capacity of the facility or (as the case may be) the increase in capacity of the facility;

(b) the length of time required to recover the investment in the facility or (as the case may be) the investment in the modification; and

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) The Authority shall give an exemption with respect to a facility where it is satisfied that the requirements of subsection (7) are met.

(5A) An exemption given in accordance with subsection (5) may apply to all of the capacity of the facility concerned or to part of that capacity only, regardless of the extent of the exemption applied for; but this is subject to subsection (6).

(6) In respect of a facility which is or is to be modified to provide for a significant increase in its capacity, an exemption by virtue of subsection (5) may only be given in relation to that increase in its capacity or part of that increase in its capacity.

(6A) When deciding whether the requirements of subsection (7)(a), (d) and (e) are met, the Authority must take into account the way in which capacity is to be allocated under the capacity allocation mechanism approved in accordance with section 19DB.

(7) The requirements of this subsection are that—

(a) the facility or (as the case may be) the modification will promote security of supply;

(b) the level of risk is such that the investment to construct the facility or (as the case may be) to modify the facility ... would not be or would not have been made without the exemption;

(c) the facility is or is to be owned by a person other than the gas transporter who operates or will operate the pipeline system connected or to be connected to the facility;

(d) charges will be levied on users of the facility or (as the case may be) the increase in its capacity; and

(e) the exemption will not be detrimental to competition, the operation of an economically efficient gas market or the efficient functioning of the pipeline system connected or to be connected to the facility.

(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) Subject to subsections (8A) and (9), an exemption may not be given by virtue of subsection (5) more than once in respect of the same facility.

(8A) Subsection (8) does not prevent a further exemption being given by virtue of subsection (5) in respect of a facility if the previous exemption given by virtue of that subsection in respect of the facility has been revoked under section 19CA(3).

(9) Subsection (8) does not prevent a further exemption being given by virtue of subsection (5) in respect of a facility if—

the facility is or is to be modified to provide for significant increase in its capacity or to enable the development of new sources of gas supply;

the exemption has effect only in relation to modification; and

no previous exemption has been given by virtue of subsection (5) in relation to modification.

(10) The Authority shall publish its decision to give or refuse to give an exemption under this section, together with the reasons for its decision, in such manner as it considers appropriate.

(11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19D

(1) Subject to subsection (2A), the owner of an LNG import or export facility to which this section applies (a “relevant facility”)—

(a) shall publish prior to their entry into force the main commercial conditions relating to the grant to another person of a right to have gas or liquid gas treated in the facility on that person’s behalf; and

(b) shall publish any changes to the published conditions as soon as they become effective.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2A) The cost or the method of determining the cost of acquiring the right to have gas or liquid gas treated in a relevant facility and any changes thereto must be approved by the Authority prior to their publication; and such approval may be given on condition that certain modifications are made to the cost or methodology.

(2B) Before the owner of a relevant facility seeks approval under subsection (2A) he must carry out such consultation as the Authority may require.

(3) The owner of a relevant facility shall ensure that the conditions which he is required to publish under subsection (1) do not discriminate against any applicants or descriptions of applicants, or any potential applicants or descriptions of potential applicants, for a right to have gas or liquid gas treated in the facility.

(4) Any person who seeks a right to have gas or liquid gas treated on his behalf in a relevant facility (“the applicant”) shall, before making an application to the Director under subsection (8), apply to the owner of the facility for the right.

(5) An application under subsection (4) shall be made by giving notice to the owner specifying what is being sought.

(6) Such a notice shall, in particular, specify—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) the kind of gas or liquid gas to be treated (which must be of, or similar to, the kind which the facility is designed to treat); and

(7) The owner shall notify the applicant of his decision giving reasons for any refusal.

(8) If the owner refuses the application , the applicant may apply to the Director for directions under subsection (11) which would secure to the applicant the right specified in the notice under subsection (5).

(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(10) Where a person applies to the Authority under subsection (8), the Authority shall—

(a) decide whether to give directions under subsection (11), to consider the application further or to reject the application

(b) give notice of his decision to the applicant; and

(i) give to the owner of the facility, the Health and Safety Executive and any person who has a right to have gas or liquid gas treated in the facility notice that the application is to be so considered and an opportunity of being heard about the matter; and

(ii) after so considering the matter, decide whether to give directions under subsection (11) or to reject the application and give notice of its decision to the applicant.

(11) Where, after considering an application under subsection (8), the Director is satisfied that the giving of directions under this subsection would not prejudice the efficient operation of the facility, or the treatment in the facility of—

(a) the quantities of gas or liquid gas which the owner of the facility requires or may reasonably be expected to require to be treated in the facility; and

(b) the quantities of gas or liquid gas which any person who has a right to have gas or liquid gas treated in the facility is entitled to require to be so treated in the exercise of that right;

the Director may give such directions to the owner of the facility ; but this is subject to subsections (11A) and (11B) .

(11A) When considering whether the giving of directions under subsection (11) in respect of an LNG import or export facility would be prejudicial as mentioned in that subsection, the Authority must disregard any difficulties by virtue of which the owner of the facility may or must apply for an exemption under section 19DZA with respect to the facility.

(11B) The Authority must not give directions under subsection (11) in respect of an LNG import or export facility if—

(a) such directions would prevent the owner from carrying out any public service obligation which applies to the owner; or

(b) an exemption is in force with respect to the facility under section 19DZA (regardless of whether that exemption was given before or after the application to the Authority under subsection (8) was made).

(12) Directions under subsection (11) may—

(a) specify the terms on which the Director considers the owner of the facility should enter into an agreement with the applicant for all or any of the following purposes—

(i) for securing to the applicant the right to have treated in the facility, ... and in the quantities so specified or determined by or under the directions, gas or liquid gas which is of a kind so specified;

(ii) for securing that the exercise of that right is not prevented or impeded;

(iii) for regulating the charges which may be made for the treatment of gas or liquid gas by virtue of that right;

(iv) for securing to the applicant such ancillary or incidental rights as the Director considers necessary or expedient ...;

(b) specify the sums or the method of determining the sums which the Director considers should be paid by way of consideration for any such right; and

(c) require the owner, if the applicant pays or agrees to pay those sums within a period specified in that behalf in the directions, to enter into an agreement with him on the terms so specified.

(13) An obligation is a public service obligation for the purposes of this section if—

(a) it is imposed by or under a provision of an Act, and

(b) the provision is identified in a notice issued by the Secretary of State as a provision imposing, or enabling the imposition of, a public service obligation within the meaning of Article 3(2) of the Gas Directive (as it had effect immediately before IP completion day).

(14) For the purposes of subsection (13), the reference to Article 3(2) is to be read as if the reference in that provision to natural gas undertakings of the Community were a reference to natural gas undertakings of the United Kingdom.

19E

(1) In sections 19A to 19D and this section—

“accounting information” means such accounting records as would be required by section 386 of the Companies Act 2006 in respect of each of the storage or (as the case may be) treatment activities undertaken by the owner of the facility if those activities were the only business undertaken by the owner and the owner were a person to whom that section applied;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“significant transaction” means—any transaction which relates to rights to have gas or liquid gas stored in a storage facility, or (as the case may be) treated in an LNG import or export facility; andany other transaction which is of a description specified from time to time by the Director by notice;

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) For the purpose of considering an application under section 19B(8) or 19D(8), the Director may by notice require the owner of the relevant facility to provide him with accounting information and details of the main commercial terms of any significant transactions with associated undertakings.

(3) Owners of relevant facilities shall keep their internal accounts in such manner as will enable them to provide accounting information if required to do so by a notice under subsection (2).

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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