A/HRC/36/45 on the general regulatory framework, the levels of institutional capacity and the types of problems that must be addressed. 1. Self-regulation 30. In some countries, regulatory frameworks include the model of self-regulation, whereby public service providers regulate their own activities, set tariffs and quality standards and monitor their own performance. Many countries with public service providers have not seen the necessity of creating a separate regulatory function for the water sector. In El Salvador, the National Water Mains and Sewers Administration, the main service provider in urban areas, sets its own quality of service standards, while the Ministry of Health monitors the quality of drinking water and the Ministry of Economics approves changes to water rates (see A/HRC/33/49/Add.1, para. 25). In Tajikistan, the Ministry of Energy and Water Resources has the overall responsibility for guaranteeing the national drinking water supply and coordinating relevant actors in the water sector (see A/HRC/33/49/Add.2, para. 10). It is also responsible for the adoption and implementation of State programmes for the development of drinking water supply systems, the establishment and regulation of water tariffs and the provision of public information. 31. Self-regulation raises significant human rights challenges in terms of guaranteeing independent monitoring and providing reliable accountability mechanisms. Regulatory principles such as impartiality, accountability, transparency and good governance can potentially be compromised by self-regulation as there is no separation between policy, regulation and service provision. Benchmarking and user consultation and participation also seem to be less common. Self-regulation can also lead to a lack of uniformity in performance, including in tariff-setting, with different service providers abiding by different standards. 2. Regulation by contract 32. Regulatory frameworks may also be characterized by a broad spectrum of contractual arrangements between governments which formally delegate service provision, and third parties. In such cases, the instrument delegating service provision defines the relationship between the public asset owner and the service provider and sets service standards. In the case of State-owned companies, management will usually be delegated via legislation, decrees or contracts, while public authorities will often enter into contracts with private providers. Contracts may differ according to the ownership of assets, the responsibility for capital investments, the allocation of risks, the responsibility for operations and maintenance, and the typical contract duration. France is a country with a long history of this type of regulation, established through private-sector participation contracting with local government. 33. A number of human rights challenges arise when regulating service provision by contract, particularly when non-State actors are involved. Such challenges include guaranteeing transparent and democratic decision-making, addressing power asymmetries in the bidding and negotiation process, ensuring affordable services, avoiding disconnections in cases of inability to pay, ensuring monitoring and accountability, and addressing corruption. It is also important that contracts, which are normally valid for decades, can be reviewed and adapted over time. 34. Meaningful public participation and access to information are human rights principles that often tend to be overlooked by States and service providers during the process of tendering, bidding and contract negotiation. From a human rights perspective, it is crucial that governments ensure that contractual arrangements include the necessary human rights safeguards, and that overall they contribute to, rather than undermine, the realization of the human rights to water and sanitation, without discrimination. 35. Regulation by contract can be combined with supervision by regulatory actors. In these cases, service standards and tariffs agreed upon by the parties to the contract have to be approved by the regulatory actor. The intervention and the oversight of the contract by a regulatory actor, if oriented by the human rights framework, can contribute to the realization of the rights to water and sanitation. 9

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