(1) Article 57 is amended as follows.

(2) In paragraph (3) -

(a) in sub-paragraph (a) for "£5,000" substitute "£2,500";

(b) for sub-paragraph (b) substitute -

"(b) if there is a penalty year, subject to paragraph (4A), the operator is liable (after the end of the last penalty year), to a civil penalty of the sum of the avoided compliance costs for all penalty years.".

(3) After paragraph (4) insert -

"(4A) When setting the amount of the civil penalty to be imposed under paragraph (3)(b), the regulator may increase the sum of the avoided compliance costs for all penalty years (before any reduction under article 48) by 10% of the total or £2,500, whichever is higher.".