Part 5: Water Section 86: Water and sewerage undertakers in England: modifying appointments New section 12F Determination by CMA of appeal
Subsection (1) sets out that the process in this section applies to all appeals brought under new section 12D.
	Subsection (2) requires CMA to have regard to Ofwat’s duties as set out in section 2 of the Water Industry Act 1991 and the strategic priorities set out in any Strategic Policy Statement issued to Ofwat by Defra Secretary of State under section 2A of that Act. Ofwat’s duties under section 2 include duties to further the consumer objective; secure that the functions of water and sewerage undertakers are properly carried out across Wales and England; secure that undertakers are able to finance the proper carrying out of their functions; secure that the activities authorised by the licence of a licensed water supplier and any statutory functions imposed on it in consequence of the licence are properly carried out; and to further the resilience objective.
	Subsection (3) allows the CMA to consider any matter that Ofwat did not consider, provided Ofwat would have been entitled to do so, such as more recent company data. The CMA must not consider any matter Ofwat would not have been entitled to consider.
	Subsection (4) sets out the grounds on which the CMA can allow an appeal: that Ofwat did not take proper account of its duties under the Water Industry Act 1991 or its strategic priorities; that Ofwat’s decision was based on a factual error; that the modifications do not achieve what Ofwat contended they achieve; that Ofwat did not follow the statutory procedure for making modifications; or that the decision was legally wrong.
	Subsection (5) sets out that, where the appeal is not allowed, the CMA must confirm Ofwat’s original decision.