in influencing policy positions related to water and sanitation through their influential municipal associations (the Deutsche Städtetag representing the largest cities and towns and the Deutscher Städte- und Gemeindebund representing smaller cities and towns). There are no autonomous regulatory agencies for water and sanitation in Germany at the state or federal level. The recently created federal regulatory agency for network industries (Bundesnetzagentur) covers telecommunications, postal services, electricity, gas and rail. It does not cover water supply and sanitation, since it is a responsibility of the states. Water and sanitation tariffs are approved through different procedures in each state, usually by a department in the state Ministry of Economy after a review of the tariff increase request by an independent auditor. In city-states (Berlin, Hamburg, Bremen) this means that the Minister (called Senator) of Economy both requests the tariff increase in his capacity as chairman of the board of the utility and also approves it, which constitutes a conflict of interest. In the case of some private utilities, tariffs are set by a mutually agreed arbitrator based on the professional opinion of an auditor. Drinking water quality is monitored by the public health departments of municipalities and counties (Landkreise). Environmental monitoring is largely based on self-monitoring, which has proven to be reliable, and occasional samples by environmental Ministries of the states. Business associations Industry associations and professional associations also play an important role in self-regulating the water and sanitation sector (verbandliche Selbstverwaltung). In early 2007 there were six associations in the sector. They include two industry associations, the Association of Electricity and Water Utilities BDEW and the VKU (association of municipal utilities); two professional associations, the DWA (professional association for water and sanitation), BVGW (professional association for gas and water); and two associations specialized on sub-sectors, the ATT (working group of dam operators providing drinking water) and DBVW (association of land and water associations). In particular the two professional associations play an important role assisting in the development of technical norms and, more recently, in performance benchmarking. Recent developments: debate on liberalization and modernization A study commissioned in 2000 by the Ministry of Economy suggested to liberalize the German water sector, allowing competition similar to the telecommunications and electricity sectors. The proposal met with harsh criticism, including from the Federal Environment Agency (UBA) and the associations of municipalities, which alleged that liberalization could entail setbacks for the protection of health and