Water Act 2014

(66DA) (1) The Authority may issue one or more codes in respect of section 66D agreements. (2) A code may make provision about— (a) procedures in connection with making a section 66D agreement; (b) procedures in connection with varying or terminating a section 66D agreement; (c) the terms and conditions of a section 66D agreement, including terms as to the duration of such an agreement; (d) principles for determining the terms and conditions that should or should not be incorporated into a section 66D agreement. (3) A code may make provision about the steps to be taken by the Authority in determining for the purposes of section 66D(2) whether a water undertaker is, in the particular case, required to perform a duty under sections 66A to 66C. (4) If the Authority considers that a water undertaker or a water supply licensee is not acting as required by a code, the Authority may give the undertaker or the licensee a direction to do, or not to do, a thing specified in the direction. (5) The Authority may not give a direction under subsection (4) requiring a person to enter into, vary or terminate an agreement. (6) It is the duty of a water undertaker or a water supply licensee to comply with a direction under subsection (4), and this duty is enforceable by the Authority under section 18. (7) A code may make— (a) different provision for different persons or descriptions of person; (b) different provision for different duties under sections 66A to 66C. (8) The Authority may from time to time revise a code issued under this section and issue a revised code. (9) A revised code may include provision for applying any of its revisions to section 66D agreements made before the revised code comes into effect. (66DB) (1) Before issuing a code under section 66DA, the Authority must— (a) prepare a draft of the proposed code under section 66DA; (b) consult persons in accordance with subsections (2) to (4). (2) If the proposed code relates to section 66D agreements made with water undertakers whose areas are wholly or mainly in England, the Authority must consult the following about the proposed code— (a) the Secretary of State; (b) the Chief Inspector of Drinking Water; (c) the appropriate agency; (d) the Council; (e) any relevant undertakers likely to be affected by the proposed code; (f) any water supply licensees likely to be affected by the proposed code; (g) such other persons as the Authority thinks appropriate. (3) If the proposed code relates to section 66D agreements made with water undertakers whose areas are wholly or mainly in Wales, the Authority must consult the following about the proposed code— (a) the Welsh Ministers; (b) the Chief Inspector of Drinking Water for Wales if there is one, or the Chief Inspector of Drinking Water if section 86(1B)(b) applies; (c) the appropriate agency; (d) the Council; (e) any relevant undertakers likely to be affected by the proposed code; (f) any water supply licensees likely to be affected by the proposed code; (g) such other persons as the Authority thinks appropriate. (4) The Authority must specify the period (“the consultation period”) within which a person may make representations about the proposed code. (5) Before a code under section 66DA prepared by the Authority is issued, the Minister may direct the Authority— (a) not to issue the code, or (b) to issue the code with specified modifications. (6) Subsection (5) is subject to subsections (8) and (9). (7) In subsection (5) “the Minister” means— (a) the Secretary of State, so far as a code prepared by the Authority relates to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, so far as a code prepared by the Authority relates to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in Wales; (c) the Secretary of State and the Welsh Ministers acting jointly, so far as a code prepared by the Authority relates to section 66D agreements not falling within paragraph (a) or (b). (8) If the power under subsection (5) is exercised to give a direction in respect of such section 66D agreements as are referred to in paragraph (a), (b) or (c) of subsection (7), it may not be exercised again in respect of such section 66D agreements as are referred to in that paragraph. (9) If the power under subsection (5) to give a direction in respect of such section 66D agreements as are referred to in paragraph (a), (b) or (c) of subsection (7) is not exercised on the first occasion on which it may be so exercised, it may not be exercised in respect of such section 66D agreements as are referred to in that paragraph on a later occasion. (10) A direction under subsection (5) must be given within the period of 28 days beginning with the day after the end of the consultation period, and a code prepared by the Authority in relation to which a direction may be given may not be issued before that period of 28 days has expired. (11) In this section “the appropriate agency” means— (a) the Environment Agency, in relation to section 66D agreements made with water undertakers whose areas are wholly in England; (b) the NRBW, in relation to section 66D agreements made with water undertakers whose areas are wholly in Wales; (c) both the Environment Agency and the NRBW, in relation to section 66D agreements made with water undertakers whose areas are partly in England and partly in Wales. (12) This section is subject to section 66DC. (66DC) (1) This section applies if the Authority proposes to issue a revised code and, in the view of the Authority, the revision or each of the revisions proposed to be made is— (a) a revision for which consultation is unnecessary, or (b) a revision that it is necessary or desirable to make without delay. (2) Section 66DB does not apply to the proposed revised code. (3) Once the Authority has issued the revised code, it must give notice as soon as reasonably practicable of— (a) the issuing of the revised code, and (b) as regards each revision contained in it, whether in the view of the Authority the revision falls within paragraph (a) or (b) of subsection (1). (4) Notice under subsection (3) is to be given to such persons as the Authority considers appropriate. (5) Unless the Authority gives notice that a revision in a revised code is in the view of the Authority a revision falling within subsection (1)(a), the revision ceases to have effect at the end of the period of six months beginning with the day after that on which the revised code is issued.

5

For section 66E of that Act there is substituted—

(66E) (1) The Authority must issue rules about charges that may be imposed by a water undertaker under a section 66D agreement. (2) The rules may in particular make provision about— (a) the types of charges that may be imposed; (b) the amount or the maximum amount, or methods for determining the amount or maximum amount, of any type of charge; (c) principles for determining what types of charges may or may not be imposed; (d) principles for determining the amount of any charge that may be imposed; (e) publication of the charges that may be imposed. (3) The rules must include provision for and in connection with requiring a water undertaker to impose on a water supply licensee only such charges as would enable the licensee, where the services it provides to a person under its retail authorisation or restricted retail authorisation are services to which a section 142(2)(b) agreement would apply if the undertaker had continued to provide the services, to charge for those services at the same rate or rates as would have applied if the section 142(2)(b) agreement had applied. (4) In subsection (3) “section 142(2)(b) agreement” means an agreement to which section 142(2)(b) applies. (5) If the Authority considers that a water undertaker is not acting as required by rules under this section, the Authority may— (a) give the undertaker a direction to do, or not to do, a thing specified in the direction, or (b) in a case where a section 66D agreement to which the undertaker is party requires modification in order to conform to the rules, give a direction to the undertaker and the water supply licensee in question to modify the agreement. (6) It is the duty of a water undertaker or a water supply licensee to comply with a direction under subsection (5), and this duty is enforceable by the Authority under section 18. (7) The rules may— (a) make different provision for different persons or descriptions of person; (b) make different provision for different purposes; (c) make provision subject to exceptions. (8) The Authority may from time to time revise rules issued under this section and issue revised rules. (9) The Authority must issue revised rules if— (a) guidance is issued under section 66ED, and (b) the Authority, having regard to that guidance, considers that it is appropriate to revise the rules. (10) Revised rules may include provision for applying any of their revisions to section 66D agreements made before the revised rules come into effect. (66EA) (1) Rules under section 66E may make provision about the reduction of charges payable under a section 66D agreement where— (a) a water supply licensee that has a retail authorisation or a restricted retail authorisation is party to the section 66D agreement, and (b) other conditions specified by the rules are satisfied. (2) Rules made by virtue of subsection (1) may in particular— (a) specify conditions relating to any party to the section 66D agreement; (b) specify conditions about persons taking steps for the purpose of reducing or managing water consumption; (c) specify conditions about the premises by reference to which such steps are to be taken; (d) specify conditions about reducing charges payable by a person who— (i) is not party to the section 66D agreement, and (ii) takes or proposes to take such steps as satisfy or would satisfy a condition specified under paragraph (b). (3) The rules may provide that, where a charge falls to be reduced in accordance with rules made by virtue of subsection (1), the water undertaker to which the charges are payable must give notice of that reduction to the Authority. (4) Rules made by virtue of subsection (3) may— (a) make provision as to the content of the notice; (b) specify the period within which an undertaker is to give notice to the Authority. (5) Provision under subsection (4)(a) may in particular require the notice to specify— (a) the amount of the charge, with and without the reduction; (b) the period for which the reduction has effect. (66EB) (1) Before issuing rules under section 66E, the Authority must— (a) prepare a draft of the proposed rules, and (b) consult the relevant persons about the draft. (2) The relevant persons are— (a) the Secretary of State; (b) the Welsh Ministers; (c) the Council; (d) any water undertakers likely to be affected by the rules; (e) any water supply licensees likely to be affected by the rules; (f) such other persons as the Authority thinks appropriate. (3) The Authority must specify the period (“the consultation period”) within which persons may make representations about the proposed rules. (4) The Authority must have regard to guidance issued under section 66ED in preparing rules under section 66E. (5) Before rules under section 66E prepared by the Authority are issued, the Minister may direct the Authority not to issue the rules. (6) In subsection (5) “the Minister” means— (a) the Secretary of State, so far as rules prepared by the Authority relate to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, so far as rules prepared by the Authority relate to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in Wales; (c) the Secretary of State and the Welsh Ministers acting jointly, so far as rules prepared by the Authority relate to section 66D agreements not falling within paragraph (a) or (b). (7) A direction under subsection (5) must be given within the period of 28 days beginning with the day after the end of the consultation period, and rules may not be issued before that period of 28 days has expired. (8) This section is subject to section 66EC. (66EC) (1) This section applies if the Authority proposes to issue revised rules under section 66E and, in the view of the Authority, the revision or each of the revisions proposed to be made is— (a) a revision for which consultation is unnecessary, or (b) a revision that it is necessary or desirable to make without delay. (2) Section 66EB does not apply to the proposed revised rules. (3) Before issuing the revised rules, the Authority must give notice to the Minister of its intention to issue revised rules. (4) Before the revised rules are issued, the Minister may direct the Authority not to issue the revised rules. (5) A direction under subsection (4) must be given within the period of 14 days beginning with the day after the day on which notice is given under subsection (3), and the Authority may not issue the revised rules in question before— (a) that period of 14 days expires, or (b) the Minister notifies the Authority that no direction under subsection (4) will be given in relation to the revised rules, whichever is the sooner. (6) Once the Authority has issued the revised rules, it must give notice as soon as reasonably practicable of— (a) the issuing of the revised rules, and (b) as regards each revision contained in them, whether in the view of the Authority the revision falls within paragraph (a) or (b) of subsection (1). (7) Notice under subsection (6) is to be given to such persons as the Authority considers appropriate. (8) Unless the Authority gives notice that a revision in revised rules is in the view of the Authority a revision falling within subsection (1)(a), the revision ceases to have effect at the end of the period of six months beginning with the day after that on which the revised rules are issued. (9) In this section “the Minister” has the meaning given by section 66EB. (66ED) (1) The Minister may issue guidance as to the content of rules under section 66E. (2) Before issuing the guidance, the Minister must— (a) prepare a draft of any proposed guidance; (b) consult the relevant persons about the draft. (3) The relevant persons are— (a) the Secretary of State; (b) the Welsh Ministers; (c) such other persons as the Minister thinks appropriate. (4) The Minister may from time to time revise guidance issued under this section and issue revised guidance. (5) Subsections (2) and (3) apply to revised guidance as they apply to the original guidance. (6) The Minister must arrange for the publication of guidance issued under this section. (7) In this section “the Minister” means— (a) the Secretary of State, in relation to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, in relation to section 66D agreements affecting only the supply systems of water undertakers whose areas are wholly or mainly in Wales; (c) the Secretary of State and the Welsh Ministers acting jointly, in relation to section 66D agreements not falling within paragraph (a) or (b).

6

Section 66F (section 66D: supplementary) is repealed.

7

• (1) Section 66G (designation of strategic supply) is amended as follows.

• (2) In subsection (1), for “an agreement under section 66D above” there is substituted “ a section 66D agreement ”.

• (3) In subsection (4)(d), for “the agreement under section 66D above” there is substituted “ the section 66D agreement ”.

• (4) In subsection (10)—

• (a) for “section 66A” there is substituted “ section 66AA ”;

• (b) for “customers of the licensed water supplier in question” there is substituted “ relevant customers of a water supply licensee ”.

• (5) After subsection (10) there is inserted—

(11) A person is a relevant customer of a water supply licensee if the introduction of water in question is made by reference to the supply of water to that person's premises in accordance with— (a) a retail authorisation (whether that retail authorisation is an authorisation of the licensee requesting the introduction of water or another water supply licensee's authorisation), or (b) a restricted retail authorisation of the licensee requesting the introduction of water.

8

• (1) Section 66H (designation of collective strategic supply) is amended as follows.

• (2) In subsection (1)(b), for “agreements under section 66D above” there is substituted “ section 66D agreements ”.

• (3) In subsection (4)(d), for “the agreements under section 66D above” there is substituted “ the section 66D agreements ”.

• (4) In subsection (10)—

• (a) for “section 66A” there is substituted “ section 66AA ”;

• (b) for “customers of the licensed water supplier in question” there is substituted “ relevant customers of a water supply licensee ”.

• (5) After subsection (10) there is inserted—

(11) A person is a relevant customer of a water supply licensee if an introduction of water is made by reference to the supply of water to that person's premises in accordance with— (a) a retail authorisation (whether that retail authorisation is an authorisation of the licensee requesting the introduction of water or another water supply licensee's authorisation), or (b) a restricted retail authorisation of the licensee requesting the introduction of water.

9

• (1) Section 66I (prohibition on unauthorised use of supply system) is amended as follows.

• (2) In subsection (1), for “of a customer” there is substituted

of— (a) a customer, (b) the person so using that system, or (c) a person associated with that person

.

• (3) In subsection (2)(b)—

• (a) for “licensed water supplier” there is substituted “ water supply licensee ”;

• (b) for “its licence” there is substituted “ the licensee's licence ”.

• (4) After subsection (8), there is inserted—

(8A) For the purposes of this section, a person (A) is associated with another person (B) if they would be associated with each other for the purposes of Schedule 2A if A were a water supply licensee.

• (5) In subsection (9), for “section 17B(5) above” there is substituted “ section 17B ”.

SCHEDULE 3

SCHEDULE 4

After Chapter 2 of Part 4 of the Water Industry Act 1991 there is inserted—

SCHEDULE 5

1

The Water Industry Act 1991 is amended as follows.

2

In section 2 (general duties with respect to water industry) (as amended by Schedule 7)—

• (a) in subsection (2C)—

• (i) after paragraph (d) there is inserted “and”;

• (ii) paragraph (f) and the “and” preceding it are repealed;

• (b) subsection (2D) is repealed.

3

In section 2B (strategic priorities and objectives: Wales) (as inserted by section 24 and amended by Schedule 7), in subsection (4)(d), after “water supply licensees” there is inserted “ and sewerage licensees ”.

4

• (1) Section 17A (water supply licences) (as substituted by section 1) is amended as follows.

• (2) In subsection (2)—

• (a) the words from “one or more” to “combination of authorisations” are repealed;

• (b) after paragraph (b) there is inserted

or (ba) a retail authorisation and a wholesale authorisation.

;

• (c) paragraphs (c) and (d) are repealed.

• (3) In subsection (3), the words “(including their operation in England and Wales)” are repealed.

5

• (1) Section 17AA (water supply licences: restrictions on grants) (as substituted by section 1) is amended as follows.

• (2) In subsection (1), after paragraph (b) there is inserted—

(ba) the Welsh Ministers; (bb) the Chief Inspector of Drinking Water for Wales if there is one;

.

• (3) Subsection (2) is repealed.

• (4) In subsection (5), paragraphs (b) and (c) are repealed.

6

In section 17B (guidance and interpretation) (as amended by section 2)—

• (a) in subsection (4A), the words “, in the case of an undertaker whose area is wholly or mainly in England,” are repealed;

• (b) subsections (5) to (8) are repealed.

7

• (1) Section 17BA (sewerage licences) (inserted by section 4) is amended as follows.

• (2) In subsection (1), the words “whose area is wholly or mainly in England” are repealed.

• (3) After subsection (5) there is inserted—

(5A) Before giving a general authorisation, the Secretary of State must consult the Welsh Ministers.

8

In section 17BB (sewerage licences: restrictions on grants) (inserted by section 4), in subsection (1), after “of State” there is inserted “ , the Welsh Ministers ”.

9

In section 17C (meaning of household premises) (as amended by Schedule 7), in subsection (1), for “paragraphs 4 and 7(a)” there is substituted “ paragraph 4 ”.

10

Section 17D (the threshold requirement) is repealed (if not previously repealed by an order under section 3).

11

In section 17DA (guidance) (inserted by Schedule 7), paragraph (a) is repealed.

12

In section 17E (determinations by the Authority) (as amended by Schedule 7), in subsection (2)—

• (a) in paragraph (a), the words “or 7(a) or (b)” are repealed;

• (b) paragraph (c) is repealed.

13

• (1) Section 17FA (arrangements with the Water Industry Commission for Scotland) (inserted by section 6) is amended as follows.

• (2) In subsection (1)(a), the words “or a restricted retail authorisation or both” are repealed.

• (3) In subsection (2)(a), the words “or particular authorisations” are repealed.

14

In section 17G (water supply licence conditions) (as amended by Schedule 7), in subsection (4)(a)(iii), the words “so far as subsection (3) applies to water supply licences,” are repealed.

15

• (1) Section 17H (standard conditions of water supply licences) (as amended by Schedule 7) is amended as follows.

• (2) Subsection (1A) is repealed.

• (3) In subsection (2), for the words from “the different” to the end there is substituted “ whether the conditions are to relate to a retail authorisation or a wholesale authorisation or both types of authorisation. ”

• (4) In subsection (3)—

• (a) for “giving a particular authorisation or a particular combination of authorisations” there is substituted “ giving a retail authorisation or a wholesale authorisation or both authorisations ”;

• (b) for “that particular combination of authorisations” there is substituted “ those authorisations ”.

• (5) In subsection (4), for “any particular authorisation or combination of authorisations” there is substituted “ one or other or both authorisations ”.

• (6) In subsection (8)(b)(i), the words from “if the” to “supplementary authorisation,” are repealed.

• (7) In subsection (9), the words from “in a case” to “subsection (8)(b)(i)” are repealed.

16

• (1) Section 17HA (standard conditions of sewerage licences) (inserted by Schedule 7) is amended as follows.

• (2) In subsection (9)(b), after sub-paragraph (i) there is inserted—

(ia) on the Welsh Ministers.

• (3) In subsection (10), after “of State” there is inserted “ (after consulting the Welsh Ministers) ”.

17

In section 17I (modifications of water supply licences by agreement) (as amended by Schedule 7)—

• (a) in subsection (4)(b)(iv), the words from the beginning to “supply licence,” are repealed;

• (b) in subsection (5A), the words “in relation to a water supply licence” are repealed.

18

• (1) Section 17J (modification of standard conditions of water supply licences) (as amended by Schedule 7) is amended as follows.

• (2) In subsection (4)(b)(iv), the words from the beginning to “licence,” are repealed.

• (3) In subsection (5A), the words “in relation to a water supply licence” are repealed.

• (4) In subsection (10), the words “in relation to the standard conditions of water supply licences” are repealed.

19

In section 17K (water supply licences: modification references to Competition Commission) (as amended by Schedule 7), in subsection (5)(b)(iv), the words from the beginning to “licences,” are repealed.

20

• (1) Section 17N (water supply licences: reports on modification references) (as amended by Schedule 7) is amended as follows.

• (2) In subsection (10)(a)(iv), the words from the beginning to “licence,” are repealed.

• (3) In subsection (11)(a)(ii), the words from the beginning to “licences,” are repealed.

• (4) In subsection (12), the words “, if the report relates to water supply licences,” are repealed.

21

In section 17O (modification of licences following report) (as amended by Schedule 7), in subsection (5)(c)(iii), the words from the beginning to “or licences,” are repealed.

22

In section 17P (water supply licences: Commission's power of veto following report) (as amended by Schedule 7), in subsection (7)(b)(v), the words from the beginning to “licences,” are repealed.

23

In section 23 (meaning and effect of special administration order) (as amended by Schedule 7), in subsection (6)(a), the words “or supplementary” are repealed.

24

In section 24 (special administration orders made on special petitions) (as amended by Schedule 7), in subsection (1B), the words from “in relation to” to “supplementary authorisation,” are repealed.

25

In section 27C (the interests of consumers) (as amended by Schedule 7)—

• (a) in subsection (1)—

• (i) after paragraph (d) there is inserted “and”;

• (ii) paragraph (f) and the “and” preceding it are repealed;

• (b) subsection (2) is repealed.

26

• (1) Section 38ZA (standards of performance in connection with the supply of water: water supply licensees) (inserted by section 29) is amended as follows.

• (2) In subsection (1), the words “or restricted retail authorisations” are repealed.

• (3) In subsection (6), for the definition of “the Minister” there is substituted—

“the Minister” means— (a) the Secretary of State, in respect of the supply of water by a water supply licensee in accordance with the licensee's retail authorisation using the supply system of a water undertaker whose area is wholly or mainly in England; (b) the Welsh Ministers, in respect of the supply of water by a water supply licensee in accordance with the licensee's retail authorisation using the supply system of a water undertaker whose area is wholly or mainly in Wales;

.

27

In section 52 (the domestic supply duty) (as amended by Schedule 7), in subsection (4A)—

• (a) after paragraph (a) there is inserted “and”;

• (b) paragraph (c) and the “and” preceding it are repealed.

28

In section 55 (supplies for non-domestic purposes) (as amended by Schedule 7), in subsection (1A)(b), the words from “or, in the case” to “that subsection” are repealed.

29

In section 63AC(4) (as substituted by section 31), the words “ or a restricted retail authorisation ” are repealed.

30

• (1) Section 66A (use of water undertaker's supply system) (inserted by Schedule 2) is amended as follows.

• (2) Subsection (2) is repealed.

• (3) In subsection (5)—

• (a) in paragraph (a), the words “in the case of a request under subsection (1),” are repealed;

• (b) paragraph (b) is repealed.

• (4) In subsection (7)(a), the words “or (2)” are repealed.

• (5) In subsection (9)(c), the words “or a restricted retail authorisation” are repealed.

31

• (1) Section 66AA (water supply from water undertaker) (inserted by Schedule 2) is amended as follows.

• (2) Subsection (2) is repealed.

• (3) In subsection (3)(a), the words “or, as the case may be, subsection (2)” are repealed.

• (4) In subsection (5)—

• (a) in paragraph (a), the words “or, as the case may be, R” are repealed;

• (b) in paragraph (b), the words “or, as the case may be, R” are repealed.

• (5) In subsection (7)(a), the words “or (2)” are repealed.

32

• (1) Section 66B (introduction of water into water undertaker's supply system) (inserted by Schedule 2) is amended as follows.

• (2) Subsections (2) and (3) are repealed.

• (3) In subsection (4)—

• (a) in paragraph (a), the words “in a case falling within subsection (1),” are repealed;

• (b) paragraphs (b) and (c) are repealed;

• (c) in paragraph (d), for “steps under paragraphs (a), (b) or (c) (as the case may be)” there is substituted “ such steps ”.

• (4) In subsection (6)(a), the words “, (2) or (3)” are repealed.

• (5) Subsections (7) and (8) are repealed.

• (6) In subsection (9), the words “or (b)(i) or (ii)” are repealed.

• (7) Subsection (10)(b) is repealed.

33

• (1) Section 66C (introduction of water provided by secondary undertaker) (inserted by Schedule 2) is amended as follows.

• (2) In subsection (1), the words from “A request under paragraph (a)” to the end are repealed.

• (3) Subsections (2) to (4) are repealed.

• (4) In subsection (5), the words “by virtue of subsection (1), (2) or (4)” are repealed.

• (5) In subsection (6)(a), the words “, L2, L3 or R” are repealed.

• (6) In subsection (7), the words “, L2 or R” are repealed.

• (7) In subsection (9)(a), the words “, (2), (3) or (4)” are repealed.

• (8) In subsection (11), the words “, (2), (3) or (4)” are repealed.

34

In section 66E (rules about charges) (inserted by Schedule 2), in subsection (3), the words “or restricted retail authorisation” are repealed.

35

In section 66EA (rules about charges: provision about reduction in charges) (inserted by Schedule 2), in subsection (1)(a), the words “or a restricted retail authorisation” are repealed.

36

In section 66G (designation of strategic supply) (as amended by Schedule 2), in subsection (11), paragraph (b) and the “or” preceding it are repealed.

37

In section 66H (designation of collective strategic supply) (as amended by Schedule 2), in subsection (11), paragraph (b) and the “or” preceding it are repealed.

38

• (1) Section 68 (duties of water undertakers and licensed water suppliers with respect to water quality) (as amended by Schedule 7) is amended as follows.

• (2) In subsection (1A)—

• (a) in paragraph (a), the words “or restricted retail authorisation” are repealed;

• (b) in paragraph (b), the words “or restricted retail authorisation” are repealed.

• (3) In subsection (6), the words “or a restricted retail authorisation” are repealed.

39

• (1) Section 95ZA (standards of performance in connection with provision of sewerage services: sewerage licensees) (inserted by section 30) is amended as follows.

• (2) In the following places—

• (a) the opening words of subsection (1),

• (b) subsection (1)(b)(i), and

• (c) subsection (2),

for “Secretary of State” there is substituted “ Minister ”.

• (3) In subsection (2), for “Secretary of State's” there is substituted “Minister's”.

• (4) After subsection (5) there is inserted—

(6) In this section— - “the Minister” means— 1. the Secretary of State, in respect of the provision of services by a sewerage licensee in accordance with the licensee's retail authorisation using the sewerage system of a sewerage undertaker whose area is wholly or mainly in England; 2. the Welsh Ministers, in respect of the provision of services by a sewerage licensee in accordance with the licensee's retail authorisation using the sewerage system of a sewerage undertaker whose area is wholly or mainly in Wales; - “prescribed” means prescribed by regulations made by the Minister.

40

In section 96ZA (procedure for regulations under section 95ZA) (inserted by section 30), for subsection (2) there is substituted—

(2) In the application of section 96 by virtue of subsection (1)— (a) a reference to a sewerage undertaker is to be treated as a reference to a sewerage licensee, and (b) a reference to the Secretary of State is to be treated as a reference to the Minister (as defined in section 95ZA(6)). (3) Regulations under section 95ZA are to be made by statutory instrument. (4) A statutory instrument containing regulations under section 95ZA is subject to annulment in pursuance of a resolution of— (a) either House of Parliament, in the case of regulations made by the Secretary of State; (b) the Assembly, in the case of regulations made by the Welsh Ministers. (5) Section 213(2) to (2B) applies to regulations made by the Welsh Ministers under section 95ZA as it applies to regulations made by the Secretary of State.

41

• (1) Section 117G (codes under section 117F: procedure) (inserted by Schedule 4) is amended as follows.

• (2) In subsection (2), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

• (3) For subsection (4) there is substituted—

(4) Before a code under section 117F prepared by the Authority is issued, the Minister may direct the Authority— (a) not to issue the code, or (b) to issue the code with specified modifications. (4A) Subsection (4) is subject to subsections (4C) and (4D). (4B) In subsection (4) “the Minister” means— (a) the Secretary of State, so far as a code prepared by the Authority relates to section 117E agreements made with sewerage undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, so far as a code prepared by the Authority relates to section 117E agreements made with sewerage undertakers whose areas are wholly or mainly in Wales. (4C) The power under subsection (4) may not be exercised more than once by the Secretary of State or the Welsh Ministers. (4D) If the power under subsection (4) is not exercised by the Secretary of State or the Welsh Ministers on the first occasion on which it may be exercised by the Secretary of State or (as the case may be) the Welsh Ministers, it may not be exercised by the Secretary of State or (as the case may be) the Welsh Ministers on a later occasion.

• (4) In subsection (6), after paragraph (a) there is inserted—

(aa) the NRBW, in relation to section 117E agreements made with sewerage undertakers whose areas are wholly in Wales;

.

• (5) The power to give a direction under section 117G(4) of the Water Industry Act 1991 (as substituted by this paragraph) may not be exercised by the Secretary of State if, before the coming into force of this paragraph—

• (a) the Secretary of State exercised the power to give a direction under section 117G(4) of the Water Industry Act 1991 (inserted by Schedule 4), or

• (b) the Secretary of State omitted to exercise that power to give a direction.

42

• (1) Section 117K (rules under section 117I: procedure) (inserted by Schedule 4) is amended as follows.

• (2) In subsection (2), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

• (3) For subsection (5) there is substituted—

(5) Before rules under section 117I prepared by the Authority are issued, the Minister may direct the Authority not to issue the rules. (5A) In subsection (5) “the Minister” means— (a) the Secretary of State, so far as rules prepared by the Authority relate to section 117E agreements made with sewerage undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, so far as rules prepared by the Authority relate to section 117E agreements made with sewerage undertakers whose areas are wholly or mainly in Wales.

• (4) In subsection (7), after paragraph (a) there is inserted—

(aa) the NRBW, in relation to section 117E agreements made with sewerage undertakers whose areas are wholly in Wales;

.

43

• (1) Section 117L (rules under section 117I: minor or urgent revisions) (inserted by Schedule 4) is amended as follows.

• (2) In subsections (3), (4) and (5)(b), for “the Secretary of State” there is substituted “ the Minister ”.

• (3) After subsection (8) there is inserted—

(9) In this section “the Minister” has the meaning given by section 117K.

44

• (1) Section 117M (rules under section 117I: guidance) (inserted by Schedule 4) is amended as follows.

• (2) In subsection (3), for the words from “are such” to the end there is substituted

are— (a) the Secretary of State; (b) the Welsh Ministers; (c) such other persons as the Minister thinks appropriate.

• (3) In subsection (7), for “means the Secretary of State.” there is substituted

means— (a) the Secretary of State, in relation to sewerage undertakers whose areas are wholly or mainly in England; (b) the Welsh Ministers, in relation to sewerage undertakers whose areas are wholly or mainly in Wales.

45

• (1) Section 117N (designation of strategic sewerage provision) (inserted by Schedule 4) is amended as follows.

• (2) In subsection (4), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

• (3) In subsection (8), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

• (4) In subsection (11), after paragraph (a) there is inserted—

(aa) the NRBW, in a case where the undertaker's area is wholly in Wales;

.

46

• (1) Section 117O (designation of collective strategic sewerage provision) (inserted by Schedule 4) is amended as follows.

• (2) In subsection (4), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

• (3) In subsection (8), after paragraph (a) there is inserted—

(aa) the Welsh Ministers;

.

47

In section 117P (prohibition on unauthorised use of sewerage system) (inserted by Schedule 4), in subsection (1), the words “whose area is wholly or mainly in England” are repealed.

48

In section 117Q (prohibition on unauthorised removal of matter from sewerage system) (inserted by Schedule 4), in subsection (1), the words “whose area is wholly or mainly in England” are repealed.

49

In section 117S (section 117R: supplementary) (inserted by Schedule 4), at the end there is inserted—

(7) The power to— (a) make an order under subsection (1) or (2) or section 117R(1), or (b) give a direction under subsection (3), is exercisable by the Welsh Ministers (and not by the Secretary of State) in relation to any supply system of a sewerage undertaker whose area is wholly or mainly in Wales. (8) Accordingly, subsections (1) to (5) and section 117R apply in relation to an order made or a direction given by the Welsh Ministers by virtue of subsection (7) as they apply in relation to an order made or direction given by the Secretary of State. (9) A statutory instrument containing an order made by the Welsh Ministers by virtue of subsection (7) is subject to annulment in pursuance of a resolution of the Assembly.

50

In section 158 (powers to lay pipes in streets), in subsection (7)(a), the following words are repealed—

• (a) “or (b)(i)”;

• (b) “or laid in pursuance of section 66B(4)(b)(ii)”.

51

In section 195(3AA) (the Authority's register: consultation as regards water supply licensees) (as amended by Schedule 7), after “water supply licensee” there is inserted “ or a sewerage licensee ”.

52

In section 207D (exercise of adjudication functions by other persons) (inserted by section 39), in subsection (5), in paragraph (b) of the definition of “the Minister”—

• (a) the “or” following sub-paragraph (i) is repealed;

• (b) after sub-paragraph (ii) there is inserted

, or (iii) in relation to a sewerage licensee using the sewerage system of such an undertaker (see section 17BA);

.

53

In section 213 (powers to make regulations), subsection (1ZA) (inserted by Schedule 7) is repealed (if not previously repealed by an order under section 3).

54

• (1) Schedule 2A (water supply licences: authorisations) (inserted by Schedule 1) is amended as follows.

• (2) Paragraphs 1 and 2 are repealed.

• (3) Paragraphs 6 to 8 are repealed.

• (4) In paragraph 9, for “requirements in paragraphs 4 and 7 are” there is substituted “ requirement in paragraph 4 is ”.

• (5) In paragraph 10, for “paragraphs 4 and 7” there is substituted “ paragraph 4 ”.

SCHEDULE 6

SCHEDULE 7

Water Act 1989 (c. 15)

1

• (1) Section 174 of the Water Act 1989 (general restrictions on disclosure of information) is amended as follows.

• (2) In subsection (2)(b)—

• (a) for “company” there is substituted “ person ”;

• (b) for “on it” there is substituted “ on the undertaker or, as the case may be, the person ”.

• (3) In subsection (6)(a)—

• (a) for “company” there is substituted “ person ”;

• (b) for “its licence” there is substituted “ the person's licence ”.

Water Industry Act 1991 (c. 56)

2

The Water Industry Act 1991 is amended as follows.

3

• (1) Section 2 (general duties with respect to water industry) is amended as follows.

• (2) In subsection (1), for the words from “the following” to the end there is substituted “ the powers and duties conferred or imposed on the Secretary of State or the Authority by virtue of any of the relevant provisions. ”

• (3) In subsection (2A)(d), for “of a licensed water supplier” there is substituted “ of a water supply licensee or sewerage licensee ”.

• (4) In subsection (2C)—

• (a) the “and” after paragraph (d) is repealed;

• (b) in paragraph (e), for the words from “not eligible” to the end there is substituted “ household premises (as defined in section 17C) ”;

• (c) after paragraph (e) there is inserted

; and (f) customers, of companies holding an appointment under Chapter 1 of Part 2 of this Act, whose premises are below the consumption threshold and in the area of a relevant undertaker whose area is wholly or mainly in Wales,

.

• (5) In subsection (2D), for the words from “not eligible” to “the total quantity” there is substituted “ below the consumption threshold if the total quantity ”.

• (6) In subsection (2DB) (inserted by section 22), in paragraph (b) (meaning of sewerage systems), for the words from “a reference to the system comprising” to the end there is substituted “ to be construed in accordance with section 17BA(7). ”

• (7) In subsection (5A), in the definition of “the interests of consumers”—

• (a) in paragraph (a), for “licensed water suppliers” there is substituted “ water supply licensees ”;

• (b) in paragraph (b), for “by sewerage undertakers” there is substituted “ either by sewerage undertakers or by sewerage licensees acting in their capacity as such ”.

• (8) In subsection (6)—

• (a) in paragraph (a), for the words from “the provisions of” to “water suppliers” there is substituted “ the relevant provisions ”;

• (b) in paragraph (a), for the words from “contained in” to the end, there is substituted

contained in— (i) Part 2 of this Act (except section 27A and Schedule 3A), (ii) any of sections 37A to 38, 38ZA, 39, 39ZA, 39B to 39D, 40E to 40J, 42, 51CD to 51CG, 63AC to 63AF, 66B, 66CA to 66H, 66K, 66L, 66O(2), 95, 95ZA, 96, 96ZA, 99, 105ZF to 105ZI, 110F to 110J, 110L to 110O, 117E to 117O, 117R, 117S, 143B to 143E, 144ZA to 144ZF, 153, 181, 182, 185, 192A, 192B, 195, 195A and 201 to 203 below, and (iii) any of sections 42 to 54 of the Water Act 2014.

;

• (c) paragraphs (b) and (c) are repealed.

4

In section 2A (strategic priorities and objectives: England) (inserted by section 24), in subsection (4)(d), for “licensed water suppliers” there is substituted “ water supply licensees and sewerage licensees ”.

5

In section 2B (strategic priorities and objectives: Wales) (inserted by section 24), in subsection (4)(d), for “licensed water suppliers” there is substituted “ water supply licensees ”.

6

In section 6 (appointment of relevant undertakers), in subsection (5A), for “a licensed water supplier” there is substituted “ a water supply licensee or sewerage licensee ”.

7

• (1) Section 10 (transitional provision with respect to replacement appointments) is amended as follows.

• (2) In subsection (2), for “and (4)” there is substituted “ to (4) ”.

• (3) After subsection (3) there is inserted—

(3A) To the extent that charging rules issued under section 144ZA relate to charges imposed or security required by a relevant undertaker under section 185, those rules are to apply in relation to the new undertaker as if the appointment or variation had come into force.

8

In section 12 (determinations under conditions of appointment)—

• (a) in subsection (3B) (application of certain provisions to references to competition authority under section 12) for “sections 16A and 16B” there is substituted “ sections 14A and 14B ”;

• (b) in subsection (3D), for “16B” there is substituted “ 14B ”.

9

For the heading of Chapter 1A of Part 2 there is substituted— “ Water supply licences and sewerage licences ”.

10

• (1) Section 17B (provision supplementary to section 17A) is amended as follows.

• (2) For the title there is substituted “ Meaning of supply system ”.

• (3) Subsections (1) to (4) (provision as to guidance on extent of premises) are repealed.

• (4) Subsection (9) (references to a licensed water supplier) is repealed.

11

In section 17C (meaning of “household premises”), in subsection (1), for “section 17A(3)(a) above” there is substituted “ paragraphs 4 and 7(a) of Schedule 2A and paragraph 2 of Schedule 2B ”.

12

• (1) Section 17D (the threshold requirement) is amended as follows.

• (2) In subsection (1) (purpose of section 17D)—

• (a) for “section 17A(3)(b) above” there is substituted “ paragraph 7(b) of Schedule 2A ”;

• (b) after “the supply of water to any premises” there is inserted “ in accordance with a restricted retail authorisation ”.

• (3) In subsection (2) (description of the requirement), for “licensed water supplier” there is substituted “ water supply licensee ”.

• (4) In subsection (3) (guidance on making estimate)—

• (a) after “guidance issued” there is inserted “ from time to time ”;

• (b) for “the Secretary of State” there is substituted “ the Welsh Ministers ”.

• (5) Subsection (5) (duty of Secretary of State to consult the National Assembly for Wales before issuing guidance) is repealed.

• (6) Subsection (6) (application of guidance provision to threshold requirement) is repealed.

• (7) In subsection (7) (regulations as to entering into an undertaking to supply water)—

• (a) for “The Secretary of State” there is substituted “ The Welsh Ministers ”;

• (b) for “licensed water supplier” there is substituted “ water supply licensee ”;

• (c) the words “(subject to subsection (12) below)” are repealed.

• (8) In subsection (8) (regulations to alter the threshold)—

• (a) for “The Secretary of State” there is substituted “ The Welsh Ministers ”;

• (b) the words “(subject to subsection (12) below)” are repealed.

• (9) In subsection (10) (procedure), for “each House of Parliament” there is substituted “ the Assembly ”.

• (10) In subsection (11) (consultation before making regulations)—

• (a) for “the Secretary of State”, in the first place where those words occur, there is substituted “ the Welsh Ministers ”;

• (b) for “the Secretary of State thinks” there is substituted “ the Welsh Ministers think ”.

• (11) Subsections (12) and (13) (exercise of powers by Welsh Ministers) are repealed.

13

After section 17D there is inserted—

(17DA) The Authority must publish guidance issued from time to time under— (a) section 17D(3), (b) paragraph 10 of Schedule 2A, or (c) paragraph 4 of Schedule 2B, in such manner as the Authority considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.

14

• (1) Section 17E (determinations by the Authority) is amended as follows.

• (2) For subsection (1) there is substituted—

(1) The Authority may determine, in a case referred to it by— (a) a water supply licensee or a potential customer of a water supply licensee, or (b) a sewerage licensee or a potential customer of a sewerage licensee, whether a proposed supply of water to, or proposed sewerage services for, the customer would be in accordance with what is authorised by the licensee's licence.

• (3) In subsection (2)—

• (a) in paragraph (a), for “section 17A(3) above” there is substituted “ paragraph 4 or 7(a) or (b) of Schedule 2A ”;

• (b) after paragraph (a) there is inserted—

(aa) the extent of the premises to be served for the purposes of paragraph 2 of Schedule 2B;

;

• (c) in paragraph (b), after “to be supplied” there is inserted “ or served ”.

15

• (1) Section 17F (procedure for granting water supply licences) is amended as follows.

• (2) In the title, after “water supply” there is inserted “ and sewerage ”.

• (3) In subsection (4)—

• (a) the words “the Secretary of State or” are repealed;

• (b) the words “he or”, in each place they occur, are repealed.

• (4) In subsection (7)—

• (a) the words “the Secretary of State or” are repealed;

• (b) for paragraph (g) there is substituted—

(g) on each water supply licensee and sewerage licensee (other than the holder of the licence in question);

;

• (c) paragraph (h) is repealed;

• (d) in paragraph (i), the words “if the licence or variation is granted by the Authority,” are repealed.

• (5) In subsection (8), the words “by the Secretary of State or” are repealed.

16

• (1) Section 17G (water supply licence conditions) is amended as follows.

• (2) For the title there is substituted “ Licence conditions ”.

• (3) In subsection (1) (conditions to be included)—

• (a) for “A water supply licence” there is substituted “ A licence under this Chapter ”;

• (b) in paragraph (a), the words “the Secretary of State or, as the case may be,” are repealed;

• (c) in paragraph (a), the words “him or” are repealed;

• (d) in paragraph (b), for “the Secretary of State” there is substituted “ the Authority ”;

• (e) in paragraph (b), for “water supply licence” there is substituted “ licence under this Chapter ”.

• (4) After subsection (2) there is inserted—

(2A) Conditions may be included by virtue of subsection (1)(a) in a sewerage licence whether or not they are connected with— (a) effectual dealing with the contents of sewers, or (b) the use of the sewerage system of a sewerage undertaker.

• (5) In subsection (3) (directions and determinations), for “water supply licence” there is substituted “ licence under this Chapter ”.

• (6) In subsection (4) (persons who may give directions etc), in paragraph (a)(iii), at the beginning there is inserted “so far as subsection (3) applies to water supply licences,”.

• (7) In subsection (5) (duration and modification of conditions), for “water supply licence” there is substituted “ licence under this Chapter ”.

• (8) In subsection (7) (payments received by Secretary of State paid into the Consolidated Fund), for “the Secretary of State” there is substituted “ the Authority ”.

17

• (1) Section 17H (standard conditions of water supply licences) is amended as follows.

• (2) For subsections (1) to (3) there is substituted—

(1) The Secretary of State may determine the conditions that are to be the standard conditions of water supply licences granted by the Authority. (1A) Before determining the standard conditions, the Secretary of State must consult the Welsh Ministers as regards conditions relating to a restricted retail authorisation or a supplementary authorisation. (1B) The Secretary of State is to publish the standard conditions in such manner as the Secretary of State considers appropriate. (2) The standard conditions may be different depending on the different authorisations or combinations of authorisations to which the conditions are to relate. (3) The power to determine standard conditions in relation to water supply licences giving a particular authorisation or a particular combination of authorisations may be exercised only before the grant of the first licence to give that authorisation or that particular combination of authorisations (but this is without prejudice to the power to modify standard conditions in accordance with the provisions of this Chapter).

• (3) In subsection (4) (general provision about standard conditions), for “of either description” there is substituted “ giving any particular authorisation or combination of authorisations ”.

• (4) In subsection (6) (power to exclude or modify standard conditions in a particular case)—

• (a) the words “the Secretary of State or” are repealed;

• (b) the words “he or” are repealed.

• (5) In subsection (7) (steps before exercising power in subsection (6))—

• (a) the words “the Secretary of State or” are repealed;

• (b) in paragraph (a), the words “he or” are repealed;

• (c) in paragraph (b), the words “he or” are repealed.

• (6) In subsection (8) (publication of notice of intention to modify standard conditions)—

• (a) in paragraph (a), the words “the Secretary of State or (as the case may be)” are repealed;

• (b) for paragraph (b)(i) there is substituted—

(i) if the notice relates to a water supply licence giving a restricted retail authorisation or a restricted retail authorisation and a supplementary authorisation, on the Welsh Ministers;

;

• (c) paragraph (b)(iii) is repealed;

• (d) in paragraph (b)(iv), the words “if the notice is published by the Authority,” are repealed;

• (e) after paragraph (b)(iv) there is inserted—

(v) on the Water Industry Commission for Scotland.

• (7) In subsection (9) (direction not to exclude or modify a standard condition), for “the Assembly” there is substituted “ the Welsh Ministers in a case where notice was served on them under subsection (8)(b)(i) ”.

• (8) In subsection (10) (power under subsection (6) not to be exercised in certain circumstances)—

• (a) the words “Secretary of State or the” are repealed;

• (b) the words “he or” are repealed.

18

After section 17H there is inserted—

(17HA) (1) The Secretary of State may determine the conditions that are to be the standard conditions of sewerage licences granted by the Authority. (2) The Secretary of State is to publish the standard conditions in such manner as the Secretary of State considers appropriate. (3) The standard conditions may be different depending on the different authorisations or combinations of authorisations to which the conditions are to relate. (4) The power to determine standard conditions in relation to sewerage licences giving a particular authorisation or a particular combination of authorisations may be exercised only before the grant of the first licence to give that authorisation or that particular combination of authorisations (but this is without prejudice to the power to modify standard conditions in accordance with the provisions of this Chapter). (5) The standard conditions for the purposes of sewerage licences giving any particular authorisation or combination of authorisations may contain provision— (a) for any standard condition included in a licence of that description not to have effect until brought into operation in such manner and in such circumstances as may be specified in or determined under the standard conditions; (b) for the effect of any standard condition included in such a licence to be suspended in such manner, and in such circumstances, as may be so specified or determined; and (c) for any standard condition included in such a licence which is for the time being suspended to be brought back into operation in such manner and in such circumstances as may be so specified or determined. (6) Subject to subsection (7), each condition which is a standard condition is to be incorporated by reference in each sewerage licence (or in each such licence to which the standard condition applies). (7) Subject to the following provisions of this section, the Authority may, in granting a licence, exclude or modify any of the standard conditions to such extent as the Authority considers requisite to meet the circumstances of a particular case. (8) Before excluding any standard conditions or making any modifications under subsection (7), the Authority must give notice— (a) stating that the Authority proposes to exclude the conditions or make the modifications and setting out the effect of so doing; (b) stating the reasons why the Authority proposes to exclude the conditions or make the modifications; and (c) specifying the time (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed exclusions or modifications may be made, and the Authority must consider any representations or objections which are duly made and not withdrawn. (9) A notice under subsection (8) must be given— (a) by publishing the notice in such manner as the Authority considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the exclusions or modifications; and (b) by serving a copy of the notice— (i) on the Secretary of State; (ii) on the Environment Agency; (iii) on the NRBW; (iv) on the Water Industry Commission for Scotland. (10) If, within the time specified in the notice under subsection (8), the Secretary of State directs the Authority not to exclude or modify any standard condition, the Authority must comply with the direction. (11) The Authority may not exclude any conditions, or make any modifications, under subsection (7) unless the Authority is of the opinion that the exclusions or modifications are such that— (a) the licence holder would not be unduly disadvantaged in competing with other holders of sewerage licences; and (b) no other holder of a sewerage licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence being granted). (12) The modification under subsection (7) of part of a standard condition is not to prevent any other part of the condition from continuing to be treated as a standard condition for the purposes of this Chapter.

19

• (1) Section 17I (modification of licences by agreement) is amended as follows.

• (2) For the title there is substituted “ Modification of licences by agreement ”.

• (3) In subsection (1) (power of Authority to modify licence), for the words from “conditions of” to the end there is substituted

conditions of— (a) a particular water supply licence, or (b) a particular sewerage licence.

• (4) In subsection (2)(b) (modification not to cause undue disadvantage)—

• (a) in sub-paragraph (i), after “water supply licences” there is inserted “ or, as the case may be, sewerage licences ”;

• (b) in sub-paragraph (ii), after “a water supply licence” there is inserted “ or, as the case may be, a sewerage licence ”.

• (5) In subsection (4)(b) (persons to be served with notice of proposed modifications), in sub-paragraph (iv), at the beginning there is inserted “if the notice relates to a water supply licence,”.

• (6) In subsection (5) (direction not to modify a condition), the words “(after consulting the Assembly)” are repealed.

• (7) After subsection (5) there is inserted—

(5A) The Secretary of State is to consult the Welsh Ministers before giving a direction under subsection (5) in relation to a water supply licence.

20

• (1) Section 17J (general modification of standard conditions) is amended as follows.

• (2) For the title there is substituted “ Modification of standard conditions ”.

• (3) In subsection (1) (power of Authority to modify standard conditions), for the words from “may modify” to the end there is substituted

may modify— (a) the standard conditions of water supply licences, or (b) the standard conditions of sewerage licences.

• (4) After subsection (1) there is inserted—

(1A) Modifications may relate to— (a) standard conditions contained in all water supply licences or sewerage licences, or (b) standard conditions contained in those water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations.

• (5) In subsection (2) (power to make incidental and consequential modifications)—

• (a) for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”;

• (b) for “any licence of that description” there is substituted “ any licence so affected ”.

• (6) In subsection (4)(b) (persons to be served with notice of proposed modifications), in sub-paragraph (iv), at the beginning there is inserted “if the notice relates to a water supply licence,”.

• (7) In subsection (5) (direction not to modify a standard condition), the words “(after consulting the Assembly)” are repealed.

• (8) After subsection (5) there is inserted—

(5A) The Secretary of State is to consult the Welsh Ministers before giving a direction under subsection (5) in relation to a water supply licence.

• (9) In subsection (6) (modification conditional on views of relevant licence holders), for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”.

• (10) In subsection (8) (preconditions for modification of standard condition), in paragraph (c), after “a water supply licence” there is inserted “ or, as the case may be, a sewerage licence ”.

• (11) In subsection (10) (consultation with Welsh Ministers), after “subsection (6) above” there is inserted “ in relation to the standard conditions of water supply licences ”.

• (12) In subsection (12) (changed standard conditions to be used in new licences)—

• (a) for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”;

• (b) in paragraph (a), for “licences of that description” there is substituted “ water supply licences or, as the case may be, sewerage licences ”;

• (c) after paragraph (b) there is inserted—

Where the Authority modifies the standard conditions of water supply licences or sewerage licences that grant particular authorisations or combinations of authorisations, paragraph (a) has effect only as regards licences granting the same authorisations or combinations of authorisations.

• (13) In subsection (13) (meaning of “relevant licence holder”), for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences or of such of those licences as grant a particular authorisation or combination of authorisations ”.

21

• (1) Section 17K (references to competition authority in relation to the modification of licences) is amended as follows.

• (2) For the title there is substituted “ Modification references to competition authority ”.

• (3) In subsection (1) (reference of a particular licence), in paragraph (a)(i), for “a particular licence” there is substituted “ a particular water supply or sewerage licence ”.

• (4) In subsection (2) (general matters that may be referred), in paragraph (a)(i), for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations ”.

• (5) In subsection (5)(b) (persons to be served with copy of reference or variation), in sub-paragraph (iv), at the beginning there is inserted “in a case relating to a water supply licence or licences,”.

22

• (1) Section 17N (reports on modification references) is amended as follows.

• (2) For the title there is substituted “ Reports on modification references ”.

• (3) In subsection (10)(a) (persons to be served with report relating to a particular licence), in sub-paragraph (iv), at the beginning there is inserted “if the report relates to a water supply licence,”.

• (4) In subsection (11)(a) (persons to be served with report relating to a standard condition), in sub-paragraph (ii), at the beginning there is inserted “if the report relates to water supply licences,”.

• (5) In subsection (12) (meaning of “relevant time”), in paragraph (a), after “Secretary of State and” there is inserted “ , if the report relates to water supply licences, ”.

23

• (1) Section 17O (modification of licences following report) is amended as follows.

• (2) For the title there is substituted “ Modification of licences following report ”.

• (3) In subsection (2) (power to make incidental and consequential modifications), for “the standard conditions of retail licences or combined licences” there is substituted

— (a) the standard conditions of water supply licences or sewerage licences, or (b) the standard conditions of water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations,

.

• (4) In subsection (5)(c)(iii), at the beginning there is inserted “in a case relating to a water supply licence or licences,”.

• (5) In subsection (10) (changed standard conditions to be used in new licences)—

• (a) for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”;

• (b) in paragraph (a), for “licences of that description” there is substituted “ water supply licences or, as the case may be, sewerage licences ”;

• (c) after paragraph (b) there is inserted—

Where the Authority modifies the standard conditions of water supply licences or sewerage licences that grant particular authorisations or combinations of authorisations, paragraph (a) has effect only as regards licences granting the same authorisations or combinations of authorisations.

24

• (1) Section 17P (competition authority's power of veto following report) is amended as follows.

• (2) For the title there is substituted “ Power of veto following report ”.

• (3) In subsection (7)(b) (persons to be served with notice of modifications proposed), in sub-paragraph (v), at the beginning there is inserted “if the reference relates to water supply licences,”.

• (4) In subsection (10) (power to make incidental and consequential modifications), for “the standard conditions of retail licences or combined licences” there is substituted

— (a) the standard conditions of water supply licences or sewerage licences, or (b) the standard conditions of water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations,

.

• (5) In subsection (11) (changed standard conditions to be used in new licences)—

• (a) for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”;

• (b) in paragraph (a), for “licences of that description” there is substituted “ water supply licences or, as the case may be, sewerage licences ”;

• (c) after paragraph (b) there is inserted—

Where the Authority modifies the standard conditions of water supply licences or sewerage licences that grant particular authorisations or combinations of authorisations, paragraph (a) has effect only as regards licences granting the same authorisations or combinations of authorisations.

25

• (1) Section 17R (modification of licences by order under other enactments) is amended as follows.

• (2) For the title there is substituted “ Modification by order under other enactments ”.

• (3) In subsection (1) (power for the competition authorities and the Secretary of State to modify standard conditions in order to give effect to orders under the Enterprise Act 2002), for paragraphs (a) and (b) there is substituted—

(a) the conditions of a particular water supply or sewerage licence, (b) the standard conditions of water supply licences or sewerage licences, or (c) the standard conditions of water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations,

.

• (4) In subsection (2) (identification of orders under the Enterprise Act 2002)—

• (a) in paragraph (a)(i), for “a retail licence or combined licence” there is substituted “ a water supply licence or sewerage licence ”;

• (b) in paragraph (a)(ii), for “a retail licence or combined licence” there is substituted “ a water supply licence or sewerage licence ”;

• (c) in paragraph (b), for “a retail licence or combined licence” there is substituted “ a water supply licence or sewerage licence ”.

• (5) In subsection (4) (changed standard conditions to be included in new licences and power to make incidental and consequential modifications of existing licences)—

• (a) for “subsection (1)(b)” there is substituted “ subsection (1)(b) or (c) ”;

• (b) for “the standard conditions of retail licences or combined licences” there is substituted “ the standard conditions of water supply licences or sewerage licences or of water supply licences or sewerage licences that grant a particular authorisation or combination of authorisations ”.

• (6) In subsection (5) (publication of modifications), for “retail licences or combined licences” there is substituted “ water supply licences or sewerage licences ”.

26

• (1) Section 18 (orders for securing compliance with certain provisions) is amended as follows.

• (2) In subsection (1)—

• (a) after “Part or” there is inserted “ any person holding ”;

• (b) in paragraph (a), after “that company” there is inserted “ or that person ”;

• (c) in paragraph (a)(i), after “appointment or” there is inserted “the person's”;

• (d) in paragraph (b), after “that company” there is inserted “ or that person ”.

• (3) In subsection (1A)—

• (a) in paragraph (a)(i), for “a company” there is substituted “ a person ”;

• (b) in paragraph (b), for “any company” there is substituted “ any person ”;

• (c) in that paragraph, for “the company” there is substituted “ the person ”.

• (4) In subsection (2), after “Part or” there is inserted “ any person holding ”.

• (5) In subsection (6)(a), after “Part or” there is inserted “ a person holding ”.

27

In section 19 (exceptions to the duty to enforce), for “company”, in each place, there is substituted “ person ”.

28

In section 20 (procedure for enforcement orders), for “company to which”, in each place, there is substituted “ person to whom ”.

29

• (1) Section 21 (validity of enforcement orders) is amended as follows.

• (2) In subsection (1)—

• (a) for “company to which” there is substituted “ person to whom ”;

• (b) for “company”, in the second place it occurs, there is substituted “ person ”.

• (3) In subsection (2), for “company” there is substituted “ person ”.

30

In section 22 (effect of enforcement order), in subsection (3)—

• (a) for “company”, in each place, there is substituted “ person ”;

• (b) for “it” there is substituted “ the person ”.

31

• (1) Section 22A (penalties) is amended as follows.

• (2) In subsection (1)—

• (a) in paragraph (a)(ii), for “company” there is substituted “ person ”;

• (b) in paragraph (b), in the opening words, for “company”, in both places, there is substituted “ person ”;

• (c) in the closing words, for “the company” there is substituted “ that company or that person ”.

• (3) In subsection (2)—

• (a) in paragraph (a)(ii), for “company” there is substituted “ person ”;

• (b) in paragraph (b), in the opening words, for “company”, in both places, there is substituted “ person ”;

• (c) in the closing words, for “the company” there is substituted “ that company or that person ”.

• (4) In subsection (4), in the opening words, for “company” there is substituted “ person ”.

• (5) In subsection (6)—

• (a) in the opening words, after “penalty” there is inserted “ on a person ”;

• (b) in paragraph (a), for “company”, there is substituted “ person ”;

• (c) in paragraph (d), for “company”, there is substituted “ person ”.

• (6) In subsection (7)—

• (a) for “company”, there is substituted “ person on whom the penalty has been imposed ”;

• (b) the words “on it” are repealed.

• (7) In subsection (8)(b), for “company”, there is substituted “ person on whom the penalty is to be or has been imposed ”.

• (8) In subsection (11), for the words from “10%” to “(determined” there is substituted

— (a) 10% of the turnover of the company, or (b) in a case where the person on whom the penalty is imposed is not a company, 10% of the turnover of the business of the person, (determined

.

32

• (1) Section 22C (time limits on the imposition of financial penalties) is amended as follows.

• (2) In subsection (1)—

• (a) in the opening words, after “penalty” there is inserted “ on a person ”;

• (b) in paragraph (a), for “company” there is substituted “ person ”;

• (c) in paragraph (b), for “company” there is substituted “ person ”.

• (3) In subsection (2), in the opening words—

• (a) after the first “penalty” there is inserted “ on a person ”;

• (b) for “company” there is substituted “ person ”.

33

• (1) Section 22E (appeals) is amended as follows.

• (2) In subsection (1), for “company on which” there is substituted “ person on whom ”.

• (3) In subsections (2)(a) and (b) (in both places) and (4)(b), for “company” there is substituted “ person ”.

34

In section 22F (recovery of penalties), for “company” there is substituted “ person ”.

35

• (1) Section 23 (meaning and effect of special administration orders) is amended as follows.

• (2) In subsection (1), for “a qualifying licensed water supplier” there is substituted “ a qualifying water supply licensee or a qualifying sewerage licensee ”.

• (3) In subsection (2A)—

• (a) for “a qualifying licensed water supplier” there is substituted “ a qualifying water supply licensee ”;

• (b) for “subsection (6)(b)” there is substituted “ subsection (7) ”.

• (4) After subsection (2A) there is inserted—

(2AA) The purposes of a special administration order made in relation to a company which is a qualifying sewerage licensee must be— (a) the transfer to another company or companies, as a going concern, of so much of the company's undertaking as it is necessary to transfer in order to secure that the activities relating to the removal or removals of matter mentioned in subsection (9) may be properly carried on, and (b) the carrying on of those activities pending the making of the transfer.

• (5) In subsection (2B)(b)—

• (a) in the opening words, for “or (2A)(a)” there is substituted “ , (2A)(a) or (2AA)(a) ”;

• (b) in sub-paragraph (ii), for “or (2A)(a)” there is substituted “ , (2A)(a) or (2AA)(a) ”.

• (6) In subsection (2C), for “and (2A)(b)” there is substituted “ , (2A)(b) and (2AA)(b) ”.

• (7) In subsection (4), for paragraph (b) there is substituted—

(b) a company carries on activities relating to— (i) the introduction or introductions of water mentioned in subsection (7) formerly carried on by another company; or (ii) the removal or removals of matter mentioned in subsection (9) formerly carried on by another company,

.

• (8) In subsection (6)—

• (a) for “licensed water supplier” there is substituted “ water supply licensee ”;

• (b) for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee ”;

• (c) for paragraphs (a) and (b) there is substituted—

(a) it is the holder of a water supply licence giving it a wholesale or supplementary authorisation (within the meaning of Chapter 1A of this Part), and (b) the condition in subsection (7) is satisfied in relation to it.

• (9) After subsection (6) there is inserted—

(7) The condition in this subsection is that— (a) the introduction of water by the licence holder which is permitted under section 66B or 66C is designated as a strategic supply under section 66G, or (b) the introductions of water by the licence holder which are permitted under section 66B or 66C are designated as a collective strategic supply under section 66H.

• (10) After subsection (7) (inserted by sub-paragraph (9)) there is inserted—

(8) For the purposes of this section, sections 24 to 26 and Schedule 2, a sewerage licensee is a qualifying sewerage licensee if— (a) it is the holder of a sewerage licence giving it a wholesale or disposal authorisation (within the meaning of Chapter 1A of this Part), and (b) the condition in subsection (9) is satisfied in relation to it. (9) The condition in this subsection is that— (a) the removal of matter by the licence holder which is permitted under section 117C or 117D is designated as strategic sewerage provision under section 117N, or (b) the removals of matter by the licence holder which are permitted under section 117C or 117D are designated as collective strategic sewerage provision under section 117O.

36

• (1) Section 24 (special administration orders made on special petitions) is amended as follows.

• (2) In subsection (1A)—

• (a) in paragraphs (a) and (b), the words “(after consulting the Assembly)” are repealed;

• (b) in paragraph (b), before “the Authority” there is inserted “by”;

• (c) in the words following paragraph (b), for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee or qualifying sewerage licensee ”.

• (3) After subsection (1A) there is inserted—

(1B) Before presenting a petition under subsection (1A) in relation to a qualifying water supply licensee whose licence gives it a supplementary authorisation, the Secretary of State or the Authority (as the case may be) must consult the Welsh Ministers.

• (4) In subsection (2)—

• (a) in paragraph (bb), for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee ”;

• (b) after paragraph (bb) there is inserted—

(bc) in the case of a company which is a qualifying sewerage licensee, that— (i) action taken by the company has caused a contravention by a sewerage undertaker of any principal duty; and (ii) that action is serious enough to make it inappropriate for the company to continue to hold its licence;

;

• (c) in paragraph (d), for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee or a qualifying sewerage licensee ”.

• (5) In subsection (7)(b), for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee or a qualifying sewerage licensee ”.

37

In section 25 (power to make special administration order on winding-up petition) for “qualifying licensed water supplier”, in both places, there is substituted “ qualifying water supply licensee or a qualifying sewerage licensee ”.

38

In section 26 (restrictions on voluntary winding up and insolvency proceedings), in subsection (1), for “qualifying licensed water supplier” there is substituted “ qualifying water supply licensee or a qualifying sewerage licensee ”.

39

• (1) Section 27 (general duty of Authority to keep matters under review) is amended as follows.

• (2) In subsection (1)(b), for “licensed water suppliers” there is substituted “ water supply licensees or sewerage licensees ”.

• (3) In subsection (2)—

• (a) in paragraph (aa), for “companies” there is substituted “ persons ”;

• (b) in paragraph (b), after “company” there is inserted “ or person ”.

• (4) In subsection (4)—

• (a) in paragraph (c), for the words from “retail” to “Part)” there is substituted “ the authorisations or combinations of authorisations given by licences under Chapter 1A of this Part (see sections 17A and 17BA) ”;

• (b) in paragraph (d), for “company” there is substituted “ person ”.

40

In section 27A (establishment of the Council and committees), in subsection (13), in the definition of “the interests of consumers”—

• (a) in paragraph (a), for “licensed water suppliers” there is substituted “ water supply licensees ”;

• (b) in paragraph (b), for “by sewerage undertakers” there is substituted “ either by sewerage undertakers or by sewerage licensees acting in their capacity as such ”.

41

• (1) Section 27C (the interests of consumers) is amended as follows.

• (2) In subsection (1)—

• (a) the “and” after paragraph (d) is repealed;

• (b) in paragraph (e), for the words from “not eligible” to the end there is substituted “ household premises (as defined in section 17C) ”;

• (c) after paragraph (e) there is inserted

; and (f) customers, of companies holding an appointment under Chapter 1 of Part 2 of this Act, whose premises are below the consumption threshold and in the area of a relevant undertaker whose area is wholly or mainly in Wales,

.

• (3) In subsection (2), for the words from “not eligible” to “the total quantity” there is substituted “ below the consumption threshold if the total quantity ”.

42

In section 27E (provision of advice and information to public authorities), in subsection (1), for “licensed water suppliers” there is substituted “ water supply licensees, sewerage licensees ”.

43

• (1) Section 27H (provision of information to the Council) is amended as follows.

• (2) In subsection (1)—

• (a) the “or” at the end of paragraph (b) is repealed;

• (b) in paragraph (c), for “a licensed water supplier” there is substituted “ a water supply licensee, or ”;

• (c) after paragraph (c) there is inserted—

(d) a sewerage licensee,

.

• (3) In subsections (2), (3) and (4), after “body”, in each place, there is inserted “ or person ”.

• (4) In subsection (4)—

• (a) for “it” there is substituted “ the body or person ”;

• (b) for “its” there is substituted “ the ”.

44

• (1) Section 27K (sections 27H to 27J: supplementary) is amended as follows.

• (2) In subsection (2), for “or a licensed water supplier” there is substituted “ , a water supply licensee or a sewerage licensee ”.

• (3) In subsection (5), for “and a licensed water supplier” there is substituted “ , a water supply licensee and a sewerage licensee ”.

45

• (1) Section 29 (consumer complaints) is amended as follows.

• (2) In subsection (1)—

• (a) for “or a licensed water supplier” there is substituted “ , a water supply licensee or a sewerage licensee ”;

• (b) for “by that licensed water supplier” there is substituted “ by that water supply licensee or that sewerage licensee ”.

• (3) In subsection (5)(a), for the words from “by a licensed water supplier” to “Wales” there is substituted

— (i) by a water supply licensee using the supply system of a water undertaker whose area is wholly or mainly in Wales, or (ii) by a sewerage licensee using the supply system of a sewerage undertaker whose area is wholly or mainly in Wales

.

• (4) In subsections (8)(a) and (b) and (9), for “or the licensed water supplier” there is substituted “ , the water supply licensee or the sewerage licensee ”.

46

In the heading to Chapter 1 of Part 3 (general duties of water undertakers) at the end there is inserted “etc”.

47

In section 37A (water resources management plans: preparation and review)—

• (a) in subsection (3)(b), for “licensed water suppliers” there is substituted “ water supply licensees ”;

• (b) in subsection (8)(d) for “licensed water supplier” there is substituted “ water supply licensee ”.

48

In section 37C (water resources management plans: provision of information)—

• (a) for “licensed water supplier”, in each place, there is substituted “ water supply licensee ”;

• (b) in the closing words to subsection (3), for “licensed water supplier's” there is substituted “water supply licensee's”.

49

In section 37D (water resources management plans: supplementary), in subsection (3)(b), for “licensed water supplier” there is substituted “ water supply licensee ”.

50

In section 38B (publication of statistical information about complaints)—

• (a) in subsection (1), for “licensed water suppliers” there is substituted “ water supply licensees ”;

• (b) in subsection (2), for “licensed water suppliers” there is substituted “ water supply licensees ”.

51

• (1) Section 39A (information to be given to customers about performance) is amended as follows.

• (2) In subsections (1) and (2A), for “licensed water suppliers”, in both places, there is substituted “ water supply licensees ”.

• (3) After subsection (1) there is inserted—

(1A) Each water supply licensee must, in such form and manner and with such frequency as the Authority may direct, take steps to inform the licensee's customers of— (a) the standards of overall performance established under section 38ZA(1) which are applicable to that licensee; (b) that licensee's level of performance as regards those standards. (1B) The Authority may direct that the requirement in subsection (1A) is not to apply to such water supply licensees as may be specified in the direction.

• (4) In subsection (2), for “any such direction” there is substituted “ a direction under subsection (1) or (1A) ”.

• (5) In subsection (2B), for “section 17B(5)” there is substituted “ section 17B ”.

• (6) In subsection (3), for “licensed water supplier” there is substituted “ water supply licensee ”.

52

In section 39B (drought plans: preparation and review)—

• (a) in subsection (4)(b), for “licensed water suppliers” there is substituted “ water supply licensees ”;

• (b) in subsection (7)(d), for “licensed water supplier” there is substituted “ water supply licensee ”.

53

In section 39C (drought plans: provision of information)—

• (a) for “licensed water supplier”, in each place, there is substituted “ water supply licensee ”;

• (b) in the closing words to subsection (3), for “licensed water supplier's” there is substituted “water supply licensee's”.

54

In section 42 (financial conditions for compliance with the duty in section 41), subsection (7) (terms defined in sections 43 and 43A) is repealed.

55

Sections 43 and 43A (calculations for the purpose of section 42) are repealed.

56

In section 47 (conditions of connection with water main), in subsection (1), for “sections 48 to” there is substituted “ sections 49 and ”.

57

Section 48 (interest on sums provided by way of security) is repealed.

58

• (1) Section 52 (domestic supply duty) is amended as follows.

• (2) In subsection (4A) (exclusion of certain premises), in paragraph (c), at the beginning, there is inserted “in the case of premises to be supplied using the supply system of a water undertaker whose area is wholly or mainly in Wales,”.

59

In section 55 (supplies for non-domestic purposes), in subsection (1A)(b), after “17C above) or” there is inserted “ , in the case of premises to be supplied using the supply system of a water undertaker whose area is wholly or mainly in Wales, ”.

60

• (1) Section 61 (disconnections for non-payment of charges) is amended as follows.

• (2) In subsection (1)—

• (a) for “the following provisions of this section” there is substituted “ subsections (1A) to (6) ”;

• (b) after “cut off a supply of water to any premises,” there is inserted “if subsection (1ZA) or (1ZB) applies.

(1ZA) This subsection applies

.

• (3) After the subsection (1ZA) so formed there is inserted—

(1ZB) This subsection applies if a water supply licensee requests the undertaker to disconnect the service pipe or otherwise cut off the supply of water to the premises. (1ZC) A water supply licensee may make a request under subsection (1ZB) only if— (a) the occupier of the premises is liable under an agreement with the licensee to pay charges to the licensee in respect of the supply of water to the premises, (b) the licensee has served notice on the occupier requiring payment of charges due, (c) the occupier has failed to pay the charges before the end of the period of seven days beginning with the day after the notice was served, and (d) that period has expired.

• (4) In subsection (2)—

• (a) in paragraph (a), for “subsection (1)” there is substituted “ subsection (1ZA) ”;

• (b) in the words following paragraph (b), for “that subsection” there is substituted “ subsection (1) ”.

• (5) After subsection (2) there is inserted—