Proposal of optimal regulation in the Czech water industry

This thesis deals with post-privatization development of the water industry and sewerage. It leads to problems that the current state of regulation has been unable to handle effectively. There is an outflow of money into private foreign companies rather than investing in the aging infrastructure of the Czech water system. Water has not been earning a financial gain for the state, even though its price over the years continues to grow. The state has been unable to allocate investments toward cities and municipalities that have a high incentive to establish a superior water infrastructure. Water companies often have the privileged position in this field and even though they are regulated by antitrust laws, their operation is not socially efficient. In compliance with the information asymmetry and the pressure of the groups of interest, the regulator is affected more by the preferences of the water system companies rather than the interests of society. The aim of the thesis is to suggest the adjustment of regulation in the Czech Republic on the basis of foreign experience. Comparative analysis of the approaches of chosen European countries was used for this purpose; and further, for a deeper comparison, the situation is presented at a much better mapped and described telecommunication market. From the discussed methods of regulation (following the example of the European experience), not only the recommendations regarding the changes of duties for operators to lease the water infrastructure are suggested, but also non-discrimination of the individual consumer groups, changes of legislation in favor of long-term sustainable development in the field of water supply, and suggestions for dealing with information asymmetry.