[F17B.—(1) Any condition specified in an order under Article 7(1)(c) in respect of a conveyance exemption which requires the approval of the Authority for the methodology of calculating a system charge in relation to a distribution system or which imposes any obligation on the holder of the exemption in relation to that approval, shall not apply in relation to any closed distribution system.
(2) Where the holder of a conveyance exemption who operates or has control of a closed distribution system receives an expression of interest from a customer who owns or occupies premises that are connected to the system, he must—
(a)inform that customer that the distribution system in question is a closed distribution system; and
(b)within 7 working days, beginning on the day on which he receives the expression of interest, by notice inform any third party supplier identified in the expression of interest that the distribution system in question is a closed distribution system.
(3) Where a customer has served an expression of interest in respect of a closed distribution system and—
(a)the customer, or a third party supplier identified in that expression of interest, serves a notice on the holder of the exemption relating to that distribution system requesting that the methodology for a proposed system charge be submitted to the Authority for approval; and
(b)at the time of receiving the request the holder of the exemption has not received any confirmation that the customer has entered into a contract with a third party, then paragraph (4) applies.
(4) From the time the holder of the conveyance exemption receives the request referred to in paragraph (3)(a), the conditions referred to in paragraph (1) shall have effect as if the distribution system in question were not a closed distribution system.
(5) Where a customer who owns or occupies premises that are connected to a closed distribution system has served a notice on the holder of a conveyance exemption relating to that system that he has entered into a contract with a third party supplier (“the confirmed third party supplier”) and—
(a)the customer or the confirmed third party supplier serves on the holder of the exemption a notice requesting that the methodology for use of the system charge that is being applied be submitted to the Authority for approval; and
(b)the methodology for calculating the charge has not previously been approved by the Authority,
paragraphs (6) to (11) apply.
(6) The holder of the exemption must, within 20 working days, beginning with the day on which he receives the request under paragraph (5)—
(a)provide the Authority with a charging statement in respect of the methodology for any system charge applied at the time the request was made and such other information or documents as the Authority may specify; and
(b)provide the customer and the confirmed third party supplier with a copy of that charging statement.
(7) Where the Authority has requested further documents or information in accordance with paragraph (6)(a) at a time when there are fewer than 10 working days remaining in the 20 working day period mentioned in that sub-paragraph, those further documents or information must be provided within 10 working days beginning with the day on which the holder of the exemption received the request for further documents or information.
(8) Where the holder of the exemption has complied with paragraph (6)(a), the Authority must as soon as is reasonably practicable—
(a)decide whether to approve the methodology set out in the charging statement; and
(b)notify the conveyance exemption holder and the confirmed third party supplier of its decision.
(9) Where the Authority does not approve the methodology, it must give reasons for that decision.
(10) Where the Authority has notified the holder of the exemption of a decision that it does not approve the methodology, that holder must not continue to impose a system charge except where the Authority has considered the methodology for such a charge and has approved it.
(11) Where the Authority has not approved a methodology submitted under paragraph (6), the holder of the exemption may—
(a)submit to the Authority a charging statement containing details of a revised methodology;
(b)provide the Authority with such other information and documents as the Authority may specify; and
(c)send a copy of the charging statement to the customer and the confirmed third party supplier.
(12) If the holder of the exemption takes the steps mentioned in paragraph (11), paragraphs (8) and (9) apply as if he had complied with paragraph (6).]