Section 11Part 3 — PROVISION OF WATER SUPPLY OR WASTE WATER SERVICES TO THIRD PARTIES
Power to take possession of water or wastewater infrastructure in certain cases
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Unless otherwise provided for in a licence, the Office may in circumstances where any operator licensee or service provider licensee —
is in fundamental breach of the licence;
persistently breaches any condition attached to the licence or repeatedly contravenes this Law;
is dissolved;
is wound up or declared bankrupt;
is convicted of an offence under this Law and punished by a fine in excess of one hundred thousand dollars;
fails to pay any licence fee, regulatory fee or financial commitment under this Law for a continuous period in excess of three months;
is to be struck or is struck from the register of companies;
compounds with its creditors to the detriment of the public interest; or
obtained the licence by a fraudulent, false or misleading representation or in some other illegal manner;
after consultation with the Cabinet, initiate proceedings to retain a competent operator to take possession of and operate the concession.
The Office shall, before acting under subsection (1), give twenty-one days' written notice to the operator licensee or service provider licensee, in which notice the Office shall —
draw to the attention of the licensee the grounds on which the Office intends to take over the operations of the concession; and
give an opportunity to the licensee, to submit before the expiration of the twenty-one day period of notice, a time bound plan to remedy the breach for the Office's consideration.
If, in the opinion of the Office the public interest or security of the Islands is not harmed in so doing, the Office may approve the plan.
If the Office does not approve the plan under subsection (2)(b), the Office may appoint a competent operator to take possession of and operate the concession in place of the operator licensee or service provider licensee, under the terms and conditions of the licence issued to the operator licensee or service provider licensee.
The appointed operator shall be given full access to take possession of and operate the concession by the licensee, but —
shall not assume any debt that may be owed by the licensee; and
shall be entitled to recover operational costs and a fair and reasonable profit, as determined by the Office, from the operation of the concession.
During the period the appointed operator is operating the concession —
the Office shall make every reasonable effort to ensure that the concession is operated efficiently;
the concession shall remain the property of the licensee; and
the licensee shall have the right, after giving reasonable notice, for its agent or representative to access and monitor the works at any reasonable time;
and the appointed operator shall only be liable for damage occasioned to the assets of the licensee during that period insofar as it arises from or is occasioned by the appointed operator's gross negligence, wilful neglect, wilful default or wilful acts.
The licensee shall be entitled to apply to the Office for the reinstatement of its concession and the Office may —
reinstate the concession and, in doing so, release the appointed operator; and
require the appointed operator to return the operation of the concession to the licensee within a period of fourteen days after being so ordered in writing.
Any costs which the appointed operator has incurred as a direct consequence of operating the concession and which the appointed operator has not recovered by way of revenue derived from the operation shall become a debt due from the licensee.
If, upon a reasonable amount of time to be determined by the Cabinet and upon the advice of the Office, the concession is not reinstated in accordance with the provisions of this section, the Cabinet may compel divestiture of the assets required to operate the concession in accordance with regulations made under this Law.
During the period of transition to the appointed operator, the licensee shall operate the facilities in accordance with prudent practice and shall cooperate fully with the appointed operator until the takeover is completed.
The Cabinet, acting in consultation with the Office, may designate the Authority to operate the concession on terms to be agreed with the Authority having regard to the public interest.
Defined Terms
fundamental breachgross negligencewilful neglectwilful default