CAT rejects proposed competition claims against water companies

12/03/25

Professor Carolyn Robert brought applications for collective proceedings order against six water and sewerage undertakers (the “PDs”) alleging that, in breach of section 18 of the Competition Act 1998, the PDs had abused a dominant position by under-reporting the number of pollution incidents that occurred on their sewerage networks and, through the operation of the relevant regulatory price control regime, had thereby recovered greater revenues from their household customers than they would have had they correctly reported the number of pollution incidents.

The PDs contended that the proposed claims were: (i) excluded by a statutory ouster clause in section 18(8) of the Water Industry Act 1991; (ii) precluded because the Competition Act 1998 did not apply to the relevant activities of the PDs as statutory monopolists; and, in any event, (iii) not suitable for certification under section 47B of the Competition Act 1998 and the Competition Appeal Tribunal Rules 2015.

In its judgment of 7 March 2025, the Tribunal held that the proposed claims were excluded by section 18(8) of the Water Industry Act 1991 because breach of the PDs’ conditions of appointment as water and sewerage undertakers was an essential ingredient of the proposed claims for beach of section 18 of the Competition Act 1998. The proposed private law claims could not therefore be brought; enforcement of compliance with the PDs’ appointment conditions rests primarily with the regulator, Ofwat.

Although the issues did not strictly arise for determination in light of the Tribunal’s conclusion on the ouster question, the Tribunal rejected the PDs’ contention that the Competition Act 1998 did not apply to the PDs’ alleged conduct and rejected the PDs’ contention that the claims were not suitable for certification. 

The Tribunal’s judgment can be accessed here.