Section 16-47 - Holding companies. Approval of authority re exercise of control. Investigation and hearing. Annual reports. Injunctive relief. Exemption(a) As used in this section and section 16-47a, (1) "holding company" means any corporation, association, partnership, trust or similar organization, or person, which, either alone or in conjunction and pursuant to an arrangement or understanding with one or more other corporations, associations, partnerships, trusts or similar organizations, or persons, directly or indirectly, controls a gas company, electric distribution company, water company, telephone company, community antenna television company, holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider, and (2) "control" means the possession of the power to direct or cause the direction of the management and policies of a gas company, electric distribution company, water company, telephone company, community antenna television company, holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider, certified competitive video service provider or a holding company, whether through the ownership of its voting securities, the ability to effect a change in the composition of its board of directors or otherwise, provided, control shall not be deemed to arise solely from a revocable proxy or consent given to a person in response to a public proxy or consent solicitation made pursuant to and in accordance with the applicable rules and regulations of the Securities Exchange Act of 1934 unless a participant in said solicitation has announced an intention to effect a merger or consolidation with, reorganization, or other business combination or extraordinary transaction involving the gas company, electric distribution company, water company, telephone company, community antenna television company, holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider, certified competitive video service provider or the holding company. Control shall be presumed to exist if a person directly or indirectly owns ten per cent or more of the voting securities of a gas company, electric distribution company, water company, telephone company, community antenna television company, or a holding company, provided the authority may determine, after conducting a hearing, that said presumption of control has been rebutted by a showing that such ownership does not in fact confer control. For a holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider, or the holding company thereof, control shall be presumed to exist if a person directly or indirectly owns more than forty per cent of the voting securities of such company, provided the authority may determine, after conducting a hearing, that such presumption of control has been rebutted by a showing that such ownership does not in fact confer control.(b)(1) No gas company, electric distribution company, water company, telephone company, community antenna television company, or holding company thereof, or any official, board or commission purporting to act under any governmental authority other than that of this state or of its divisions, municipal corporations or courts, shall interfere or attempt to interfere with or, directly or indirectly, exercise or attempt to exercise authority or control over any gas company, electric distribution company, water company, telephone company or community antenna television company engaged in the business of supplying service within this state, or with or over any holding company doing the principal part of its business within this state, without first making written application to and obtaining the approval of the Public Utilities Regulatory Authority, except as the United States may properly regulate actual transactions in interstate commerce.(2) No holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider, or any official, board or commission purporting to act under any governmental authority other than that of this state or of its divisions, municipal corporations or courts, shall interfere or attempt to interfere with or, directly or indirectly, exercise or attempt to exercise authority or control over any holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider engaged in the business of supplying service within this state, without first making written application to and obtaining the approval of the Public Utilities Regulatory Authority, except as the United States may properly regulate actual transactions in interstate commerce or as set forth in subsection (j) of this section.(c)(1) No corporation, association, partnership, trust or similar organization, or person, shall take any action that causes it to become a holding company with control over a gas company, electric distribution company, water company, telephone company or community antenna television company engaged in the business of supplying service within this state, or acquire, directly or indirectly, control over such a holding company, or take any action that would if successful cause it to become or to acquire control over such a holding company, without first making written application to and obtaining the approval of the authority.(2) No corporation, association, partnership, trust or similar organization, or person, shall take any action that causes it to become a holding company with control over a holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider engaged in the business of supplying service within this state, or acquire, directly or indirectly, control over such a holding company, or take any action that would if successful cause it to become or to acquire control over such a holding company, without first making written application to and obtaining the approval of the authority, except as the United States may properly regulate actual transactions in interstate commerce or as set forth in subsection (j) of this section.(3) Any such corporation, association, partnership, trust or similar organization, or person, applying to the authority for such approval shall pay the reasonable expenses incurred by the authority in carrying out its duties under this subsection, and accordingly, shall deposit with the authority a bond, executed by a surety company authorized to do business in this state, in the amount of fifty thousand dollars, conditioned to indemnify the authority for such expenses.(d)(1) The Public Utilities Regulatory Authority shall investigate and hold a public hearing on the question of granting its approval with respect to any application made under subdivision (1) of subsection (b) of this section or subdivision (1) of subsection (c) of this section and thereafter may approve or disapprove any such application in whole or in part and upon such terms and conditions as it deems necessary or appropriate. In connection with its investigation, the authority may request the views of the gas company, electric distribution company, water company, telephone company, community antenna television company or holding company which is the subject of the application with respect to the proposed acquisition. After the filing of an application satisfying the requirements of such regulations as the authority may adopt in accordance with the provisions of chapter 54, but not later than thirty business days after the filing of such application, the authority shall give prompt notice of the public hearing to the person required to file the application and to the subject company or holding company. Such hearing shall be commenced as promptly as practicable after the filing of the application, but not later than sixty business days after the filing. The authority shall make its determination as soon as practicable, but not later than two hundred days after the filing of the application, unless the person required to file the application agrees to an extension of time or the authority extends the time as provided in this subsection. The authority may extend the time period for making its determination by not more than thirty days if, before the end of such time period, the authority notifies all parties and intervenors to the proceedings of such extension. The authority may, in its discretion, grant the subject company, certificate holder, provider or holding company the opportunity to participate in the hearing by presenting evidence and oral and written argument. If the authority fails to give notice of its determination to hold a hearing, commence the hearing, or render its determination after the hearing within the time limits specified in this subdivision, the proposed acquisition shall be deemed approved. In each proceeding on a written application submitted under said subdivision (1) of subsection (b) of this section or subdivision (1) of subsection (c) of this section, the authority shall, in a manner which treats all parties to the proceeding on an equal basis, take into consideration (1) the financial, technological and managerial suitability and responsibility of the applicant, (2) the ability of the gas company, electric distribution company, water company, telephone company, community antenna television company or holding company which is the subject of the application to provide safe, adequate and reliable service to the public through the company's plant, equipment and manner of operation if the application were to be approved, and (3) for an application concerning a telephone company, the effect of approval on the location and accessibility of management and operations and on the proportion and number of state resident employees. The authority shall only grant its approval of an application filed on or after January 1, 2021, made under subdivision (1) of subsection (c) of this section, if the holding company effects a change in the composition of the board of directors to include a proportional percentage of Connecticut-based directors equivalent to the percentage that Connecticut service areas represent of the total service areas covered by the holding company.(2) The Public Utilities Regulatory Authority shall investigate and hold a public hearing on the question of granting its approval with respect to any application made under subdivision (2) of subsection (b) of this section or subdivision (2) of subsection (c) of this section and thereafter may approve or disapprove any such application in whole or in part and upon such terms and conditions as it deems necessary or appropriate. In connection with its investigation, the authority may request the views of the subject certificate holder, provider or holding company which is the subject of the application with respect to the proposed acquisition. After the filing of an application satisfying the requirements of such regulations as the authority may adopt in accordance with the provisions of chapter 54, but not later than thirty business days after the filing of such application, the authority shall give prompt notice of the public hearing to the person required to file the application and to the subject certificate holder, provider or holding company. Such hearing shall be commenced as promptly as practicable after the filing of the application, but not later than sixty business days after the filing, and the authority shall make its determination as soon as practicable, but not later than one hundred eighty days after the filing of the application, unless the person required to file the application agrees to an extension of time or the authority extends the time as provided in this subsection. The authority may extend the time period for making its determination by not more than thirty days if, before the end of such period, the authority notifies all parties and intervenors to the proceedings of such extension. Such authority-noticed extension may only occur once. The authority shall, upon request of the certificate holder, provider or holding company, grant the subject company or holding company the opportunity to participate in the hearing by presenting evidence and oral and written argument. If the authority fails to give notice of its determination to hold a hearing, commence the hearing or render its determination after the hearing within the time limits specified in this subdivision, the proposed acquisition shall be deemed approved. In each proceeding on a written application submitted under said subdivision (2) of subsection (b) of this section or subdivision (2) of subsection (c) of this section, the scope of review for the authority shall be limited to (A) the financial, technological and managerial suitability and responsibility of the applicant, and (B) the legal, financial and technical ability of the holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider, certified competitive video service provider or holding company which is the subject of the application to provide safe, adequate and reliable service subject to the authority's regulation.(e) During any proceeding under subdivision (1) of subsection (b) of this section or subdivision (1) of subsection (c) of this section, the authority may order any party to such proceeding and the officers, directors, employees and agents of such party to refrain for a specific time period from communicating, directly or indirectly, with the record and beneficial owners of securities of the gas company, electric distribution company, water company, telephone company, community antenna television company or holding company which is the subject of such proceedings, in regard to the matters submitted to the authority for its approval under said subdivision (1) of subsection (b) of this section or subdivision (1) of subsection (c) of this section. If the authority issues such an order, it shall also order all other parties to the proceeding and the officers, directors, employees and agents of such parties to refrain for the same time period from communicating, directly or indirectly, with such record and beneficial owners of such securities, in regard to such matters. No order issued pursuant to this subsection shall prohibit any party from complying with disclosure and reporting obligations under any other provision of the general statutes or under federal law.(f) Each holding company shall, not later than three months after the close of its fiscal year, annually, file with the authority a copy of its annual report to stockholders for such fiscal year. If the holding company does not print such an annual report, it shall file instead, not later than the same date, a comprehensive audit and report of its accounts and operations prepared by an independent public accounting firm approved by the authority. The provisions of this subsection shall not apply to any holding company in the form of a person.(g) Any action contrary to the provisions of subsection (b) or (c) of this section shall be voidable on order of the authority.(h) Whenever any corporation, association, partnership, trust or similar organization, or person, takes or engages in any action which may or would violate subsection (b) or (c) of this section or any order adopted pursuant to said subsection (b) or (c), the Superior Court, upon application of the authority or any holding company or gas company, electric distribution company, water company, telephone company, community antenna television company, holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider or certified competitive video service provider affected by such action, may enjoin any such corporation, association, partnership, trust or similar organization, or person from continuing or doing any act in violation of said subsection (b) or (c) or may otherwise enforce compliance with said subsection (b) or (c), including, but not limited to, the reinstatement of authority or control over the gas company, electric distribution company, water company, telephone company, community antenna television company, holder of a certificate of cable franchise authority pursuant to section 16-331p, certified telecommunications provider, certified competitive video service provider or holding company to those persons who exercised authority or control over such company, certificate holder or provider before such action.(i) The provisions of this section shall not be construed to require any person to make written application to or obtain the approval of the authority with respect to any telephone company or holding company of a telephone company over which such person exercises authority or control or operates as a holding company on June 30, 1987.(j) Notwithstanding subsections (a) to (i), inclusive, of this section or any other provision of the general statutes, a holder of a certificate of cable franchise authority pursuant to section 16-331p, a certified telecommunications provider, a certified competitive video service provider or a holding company thereof shall not be required to make a written application to, or obtain the approval of, the Public Utilities Regulatory Authority with respect to any internal reorganization or restructuring of such certificate holder, provider or company that does not involve a change in the operational control or management of such certificate holder, provider or company.(1949 Rev., S. 5438; P.A. 75-486, S. 1, 69; P.A. 77-614, S. 162, 610; P.A. 80-482, S. 80, 348; P.A. 82-252, S. 4, 6; 82-472, S. 176, 183; P.A. 85-549, S. 1, 3; P.A. 86-40, S. 1, 2; P.A. 87-446, S. 1, 3; P.A. 94-74 , S. 10 , 11 ; P.A. 98-28 , S. 98 , 117 ; P.A. 09-218 , S. 1 ; P.A. 11-80 , S. 1 ; P.A. 14-134 , S. 69 .)
Amended by P.A. 23-0191,S. 4 of the Connecticut Acts of the 2023 Regular Session, eff. 7/1/2023.Amended by P.A. 23-0098, S. 19 of the Connecticut Acts of the 2023 Regular Session, eff. 7/1/2023.Amended by P.A. 20-0005, S. 7 of the Connecticut Acts of the 2020 Third Special Session, eff. 1/1/2021.Amended by P.A. 14-0134, S. 69 of the Connecticut Acts of the 2014 Regular Session, eff. 6/6/2014.Amended by P.A. 09-0218, S. 1 of the the 2009 Regular Session, eff. 7/8/2009. Commission's approval of a transfer which in time might result in an allocation of water outside of franchise area upheld. 146 Conn. 1 .