7.—(1) Subject to the following provisions of this regulation, an associated company of the incumbent undertaker is not permitted to bid in a tender process for a specified infrastructure project which relates to infrastructure for the use of that undertaker without the consent of the Secretary of State or the Authority issued by notice.
(2) The Secretary of State or the Authority may exercise the power under paragraph (1) only if the Secretary of State or the Authority respectively is of the opinion that the participation of the associated company in the tender process will not have the effect of distorting competition or breaching the principles of non-discrimination or transparency in the process.
(3) The Secretary of State must—
(a)subject to paragraph (5), before exercising the power under paragraph (1), prepare draft reasons for exercising the power and consult—
(i)the incumbent undertaker;
(ii)the Authority;
(iii)where any part of the infrastructure in question is or is to be in Wales, the Welsh Ministers; and
(iv)any other person the Secretary of State thinks appropriate; and
(b)serve on the persons mentioned in sub-paragraph (a) any notice issued by the Secretary of State under paragraph (1).
(4) The Authority must—
(a)subject to paragraph (5), before exercising the power under paragraph (1), prepare draft reasons for exercising the power and consult—
(i)the incumbent undertaker;
(ii)the Secretary of State;
(iii)where any part of the infrastructure in question is or is to be in Wales, the Welsh Ministers; and
(iv)any other person the Authority thinks appropriate; and
(b)serve on the persons mentioned in sub-paragraph (a) any notice issued by it under paragraph (1).
(5) Paragraphs (3)(a) and (4)(a) do not apply to the extent that the Secretary of State or the Authority (as the case may be) has prepared draft reasons and consulted the persons specified in those paragraphs before these Regulations come into force.
(6) The Secretary of State or Authority may by notice vary or revoke the notice issued by the Secretary of State or the Authority (as the case may be) under paragraph (1).
(7) Paragraphs (3) and (4) apply to a notice issued under paragraph (6) as they apply to a notice issued under paragraph (1).
(8) In this regulation “an associated company” means either of the following—
(a)a group company;
(b)a related company.
(9) In paragraph (8)—
(a)a “group company” means, in relation to a relevant undertaker—
(i)any holding company or subsidiary of that undertaker, or
(ii)any subsidiary of any holding company of that undertaker,
and for this purpose “subsidiary” and “holding company” have the meanings given in section 1159 of the Companies Act 2006 M1 (meaning of “subsidiary” etc) as supplemented by Schedule 6 to that Act (provisions supplementary to section 1159); and
(b)a “” means, in relation to a relevant undertaker, any undertaking in which that undertaker has a participating interest, and for this purpose—
(i)“undertaking” has the meaning given in section 1161 of the Companies Act 2006, and
(ii)“participating interest” has the meaning given in paragraph 8 of Schedule 8 (general interpretation) to the Small Companies and Groups (Accounts and Directors' Report) Regulations 2008 M2.