Financial resilience: demonstrating long-term viability for utilities

Company failure can impose costs on customers as well as society more broadly. To mitigate this, regulators have in recent years subjected companies’ business models to increased scrutiny to enable a broader set of stakeholders to assess risks to financial viability. Stress-testing has been embedded in the banking sector and is increasingly being used elsewhere—such as in the UK water sector

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Contract theory in regulation: the in-betweener of risks and incentives

On 10 October 2016, Oliver Hart and Bengt Holmström were awarded the Nobel Prize in Economic Sciences for ‘their contributions to contract theory’. Their research has helped to define how contracts enable cooperation between parties with potentially conflicting incentives. Applications of this work can be found in many areas of society and policy, from employment contracts to corporate finance and governance. What has been its effect on regulation?

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The CAPEX factor—part 2: giving stakeholders a voice

In the March 2016 issue of Agenda , ‘The CAPEX factor—part 1’ considered ways in which regulators might deal with uncertainty when determining capital allowances at periodic reviews. In this second article we consider another recent trend in regulation—the enlarged role of customers and other stakeholders in the regulatory process—and its implications for the regulation of CAPEX

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The latest intel from Luxembourg: an Advocate General prefers effects analysis in abuse cases

Over the last 15 years, the pendulum of abuse of dominance cases in EU competition law has been swinging between form-based and effects-based approaches. At a time when the former seemed to have gained prominence, the Opinion of Advocate General Wahl in the Intel case, delivered on 20 October 2016, expressed a strong preference for the latter. Where is the debate on abuse of dominance heading?

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