25 February 2019

The Electronic Communications Code: what’s new?

In the 14 months since the introduction of the Digital Economy Act 2017 and the new Electronic Communications Code in December, the reality of the situation is that the market for property owners granting new agreements for mobile phone masts or renewing existing agreements voluntarily has effectively been wiped out.

Sums being offered by network operators are so low that landowners are just not motivated to even engage with the operators. 
The consequence of this is that operators are having to resort to taking property owners to court to try and secure their phone mast sites and landowners are being forced to incur the expense of defending their assets.

Property owners receiving any communication from a network operator, or their agents, which seeks a new agreement or to renew an existing agreement should seek advice before responding if they are not to put their property assets at risk.

Cases

Some cases are now being reported by the courts and highlight some of the issues that property owners may face.

Interim rights

EE LTD and HUTCHISON 3G UK LIMITED v THE MAYOR AND BURGESSES OF THE LONDON BOROUGH OF ISLINGTON

In this case the Tribunal held that interim rights would be granted for the installation of electronic communications apparatus purely on the basis that the network operators could show that they had a “good arguable case” that they were entitled to be granted full rights over the property in due course. The tribunal also indicated that, in future, property owners could expect to have rights imposed over the properties and mobile phone masts installed on their property, without even a hearing, and that the application should be decided only on the basis of the material put before the Tribunal on paper.

The Tribunal also took account of the fact that the site provider had previously shown themselves to be willing to accept phone masts at the right price:

“If a party has shown itself willing in principle to accept the installation of equipment on its land that may be relevant to the exercise of the paragraph 26 discretion. The Tribunal will have greater confidence in imposing an agreement where it is apparent that the rights sought are not objectionable to the site owner in principle, subject to appropriate financial terms.”

It is for this reason that anyone receiving communications from a network operator should give very careful consideration as to how they respond. The case report can be found here.

Access to survey

CORNERSTONE TELECOMMUNICATIONS INFRASTRUCTURE LIMITED V UNIVERSITY OF LONDON

The Tribunal in this case made an order imposing an agreement for interim Code rights sufficient to enable the claimant to undertake the surveys and investigations required to establish whether the Building is an appropriate site for its apparatus. The Code sets out nine specific rights which a telecoms operator may seek if they wish to install apparatus but does not provide a right to survey in the first instance. Nevertheless, the Tribunal decided that the operators should have this ability and made the order. Property owners receiving a request for access to their land to carry out surveys should seek advice before acknowledging the request. The full judgment is available at this link.

Payment to the Landowner

EE LTD and HUTCHISON 3G UK LIMITED v THE MAYOR AND BURGESSES OF THE LONDON BOROUGH OF ISLINGTON

Following the decision on the interim rights application referred to above, this case came back to the Tribunal on the issue of the full rights agreement and what should be paid to the landowner for it.

Prior to the introduction of the new code, terms had been agreed between Islington and the network operators for an agreement at a rent of £21,000 per annum; however, this was not completed before the new code came into force and subsequently the network operators instead issued a claim in the Tribunal seeking the imposition of an agreement under the new code.
The outcome of that claim was that the Tribunal determined that the operators could have a lease of the site for 10 years and the sum payable for the site would be £2,551.77 per annum.

With regard to the terms of any agreement, whether it be a renewal of an existing agreement or an application for an agreement for a new site, each case will have to be considered on its own facts. Again, with this in mind we would recommend that before engaging with or even acknowledging communication from a communications operator, land owners should seek specialist advice. The full judgment is available at this link.

Current position

The government have ambitious plans for 5G and digital connectivity generally but acknowledge there are major problems in the property market with phone masts and other electronic communications apparatus. In August 2018, they stated:

“The reformed Electronic Communications Code (ECC) came into force in December 2017 with the aim of boosting coverage and connectivity across the UK, through a package of measures which Government expects to deliver significant cost reductions to the sector, while ensuring that landowners receive a fair payment for allowing their land to be used.

Since the new legislation was introduced, there have been problems with negotiations progressing. While some initial uncertainty is to be expected, Government, regulators, the telecoms sector, independent infrastructure providers and the landowner community, recognise the importance of all parties working collaboratively together, both during this transition period and moving forwards.”

It is quite possible that they may look to enacting further legislation to impose phone masts and other equipment on unwilling property owners in due course and therefore we would strongly recommend that specialist advice is sought in relation to both existing sites and any proposals for new ones.

Details of our team of specialists can be found here.