Explanatory note

Section 95 (power to trade in function-related activities through a company) of the Local Government Act 2003 (“the Act”) confers a power on the Welsh Ministers, by order, to authorise relevant authorities to do for a commercial purpose anything which they are authorised to do for the purpose of carrying on any of their ordinary functions (“the power to trade”) and to make further provision in relation to a relevant authority’s exercise of the power to trade. Section 96 of the Act confers a power on the Welsh Ministers to impose conditions on the exercise of the power to trade.

Under section 95(4) of the Act, the power to trade must only be exercisable through a company.

Article 1 of this Order specifies the relevant authorities to which this Order applies.

Article 2 authorises relevant authorities to do for a commercial purpose anything which they are authorised to do for the purpose of carrying on any of their ordinary functions. It also prescribes the conditions that a relevant authority must meet before exercising the power to trade.

Article 3 requires a relevant authority to publish any business case approved in accordance with article 2(2)(b) as soon as reasonably practicable.

Article 4 requires a relevant authority to recover any costs incurred by it for anything that it supplies to a company through which it is exercising power to trade, from that company.

Article 5 revokes the Local Government (Best Value Authorities) (Power to Trade) (Wales) Order 2006.

The Welsh Ministers’ Code of Practice on the carrying out of Regulatory Impact Assessments was considered in relation to this Order. As a result, a regulatory impact assessment has been prepared as to the likely costs and benefits of complying with this Order. A copy can be obtained from the Local Government Democracy Division, Welsh Government, Cathays Park, Cardiff, CF10 3NQ.