ESG Enforcement Tracker

Key facts:

With the first claim registered on 2 August 2023, Ms Carolyn Roberts, as the proposed class representative (PCR), is bringing six claims against water companies on behalf of customers who have allegedly been overcharged for the provision of sewerage services by the respondent water companies. These claims being managed together are the first collective proceedings brought with such a strong environmental focus before the Competition Appeal Tribunal.

In the proceedings, Ms Roberts argues that the water companies have committed an abuse of dominant position in breach of section 18 of the Competition Act 1998 in relation to the provision of misleading information to the water companies’ regulatory bodies – the Environment Agency and Ofwat – about the number of pollution incidents that had occurred.

Ofwat operates a “stick and carrot regime” for water companies. Financial incentives are offered to companies that out-perform their targets and performance commitments and, in particular, if they out-perform their targets, they are permitted to charge their customers more for the sewerage services that they provide. Some of these targets relate to specific categories of pollution incidents. Ms Roberts argues that owing to underreporting to the regulators of pollution incidents customers may have been overcharged somewhere between £800 million and £1.5 billion.

A case management conference (CMC) took place on 19 March 2024 during which the Tribunal ruled on the future conduct of the proceedings.

Further to the Tribunal’s CMC order, a hearing took place between 23 and 25 September 2024 to deal with Ms Roberts’ applications for collective proceedings orders which will determine whether the claims will proceed to trial. Judgment is awaited.