WICS consults on level playing field arrangements and a customer Code of Practice

WICS is consulting until 6 December on two aspects of Scotland’s non-household retail market, which is now 16 years old.

The first concerns implementing a Code of Practice (CoP) to provide a baseline of commitments customers can expect from licensed providers (retailers). This follows WICS’ decision to introduce a Market Health Check (MHC) and collaborative working with stakeholders to develop the CoP under the Ethical Business Regulation and Practice approach.

Licensed providers suppling 99%+ of customers (all except Smarta Water and Real Water) have committed to the CoP and MHC process and produced common commitments on: sales and marketing activities; billing, debt recovery and contract expiry; complaints and dispute resolution; and transfers. WICS is adopting these without any significant changes, but said it would work with retailers in 2025 to strengthen requirements around the use of third party intermediaries.

WICS intends to implement the CoP by 30 April 2025, via a voluntary licence condition. It will publish a list of retailers who sign up – including for Scottish Water to use in its assessment of wholesale prepay requirements – and audit those who don’t.

WICS also confirmed it would: implement and undertake the MHC; provide licensed providers with the chance to address areas of non-compliance before enforcement is considered; prioritise areas of high risk and high impact; and recover its costs through licence fees.

The second change concerned a review of the current level playing field arrangements. These relate principally to the relationship between Business Stream and its parent (and wholesaler) Scottish Water, and date from market opening when Business Stream supplied all business customers.

WICS said the arrangements, including the Governance Code, remain relevant but need updating in light of many developments since, including regarding financial resilience. The regulator is consulting on the introduction of a principle in the code on the long-term sustainability of Business Stream’s dividend policy and on whether there should be greater reporting transparency and/or separation between the regulated and non-regulated business of Business Stream (the latter relating to its English retail operations).

WICS said it would also review licence conditions for all retailers which restrict cross subsidisation between the Scottish market and related undertakings in the market in England. It is seeking views on whether additional protections are needed.