United Kingdom Statutory Instruments

(a) "the Act" means the Water Industry Act 1991;

(b) "applicable turnover" means the turnover of a water enterprise in the preceding business year, or in a case to which regulation 3(4) applies, in the period referred to in that regulation, determined in accordance with the Schedule to these Regulations; and where a business year or a period under regulation 3(4) does not equal 12 months the applicable turnover shall be the amount which bears the same proportion to the applicable turnover during that business year as 12 months does to that period;

(c) "appointed business" means the business of carrying out the activities which are necessary for a water enterprise to fulfil its functions as a relevant undertaker;

(d) "business year" means a period of more than six months in respect of which a water enterprise or, if applicable, the business of which it forms part, prepares or is required to prepare its regulatory accounts;

(e) "regulatory accounts" means regular accounting and other information supplied by the water enterprise to the Director General for Water Services to enable him to compare the financial position and performance of the appointed businesses of all water enterprises.

(a) water enterprises of interconnected bodies corporate;

(b) water enterprises carried on by two or more bodies corporate of which one and the same person or group of persons has control; or

(c) a water enterprise carried on by a body corporate and a water enterprise carried on by a person or group of persons having control of that body corporate.

     6. A person or group of persons able, directly or indirectly, to control or materially influence the policy of a body corporate, or the policy of any person in carrying on a water enterprise but without having a controlling interest in that body corporate or in that enterprise, may for the purpose of paragraph 4, be treated by the OFT as having control of it.

     7. Section 127 of the Enterprise Act 2002 shall apply to the determination of whether water enterprises are under common control for the purposes of paragraphs 5 and 6 as it applies, for the purposes specified in section 127, to section 26 of that Act.

     8. Subject to paragraph 9, applicable turnover shall not include amounts derived from the sale of products or the provision of services between the appointed businesses of water enterprises under common ownership or control.

     9. Where, as a result of the merger situation, one or more water enterprises ceases or will cease to be under common ownership or control with the water enterprise being taken over, the OFT may treat amounts derived from the sale of products or the provision of services between the water enterprise being taken over and any water enterprises ceasing to be under common ownership or control with that water enterprise as applicable turnover. If such sale of products or provision of services has not resulted in any turnover or the OFT considers that the turnover attributed to them does not reflect open market value, the OFT may attribute such value to them as it considers appropriate and include them in the calculation of applicable turnover.

     10. Paragraphs 4 to 9 above shall have no application when determining turnover for the purposes of section 33(1)(b) of the Act.

Aid granted to businesses
     11. Any aid granted by a public body to the appointed business of a water enterprise shall be included in the calculation of turnover if the business is itself the recipient of the aid and if the aid is directly linked to the sale of products or the provision of services by the business and is therefore reflected in the price.