(1) Where the Regulator concludes -

(a) that the appropriate obligations imposed under Regulations 51 to 56 have failed to achieve effective competition, and

(b) that there are important and persisting competition problems or market failures identified in relation to the wholesale provision of certain access product markets,

it may, on an exceptional basis, in accordance with Regulation 50(4), impose an obligation on vertically integrated undertakings to place activities related to the wholesale provision of relevant access products in a business entity operating independently.

(2) The independently operating business entity referred to in paragraph (1) shall supply access products and services to all undertakings, including to other business entities within the parent company, on the same timescales, terms and conditions, including those relating to price and service levels, and by means of the same systems and processes.

(3) Where the Regulator intends to impose an obligation of functional separation under this Regulation, it shall submit a request to the European Commission that includes -