A Telecommunications Code was first enacted in the Telecommunications Act 1984. In 2003 it was extended to cover all electronic communications.

The UK Government has now introduced a new Electronic Communications Code (the “New Code”) within the Digital Economy Act 2017 but the New Code is not yet in force. Ofcom are currently considering representations in respect of drafts of a Code of Practice, Standard Terms and Notices. It is anticipated that the New Code may be brought into effect in December 2017 by a commencement order. The provisions under the New Code include the following:-

Who has the benefit of Code Rights?

As at present, the New Code will apply to operators under Section 106 of the Communications Act 2003. A list of operators to which the current Code is applied can be accessed on OFCOM’s website. The New Code will also apply to providers of infrastructure services for operators.

Agreements between Landowners

Under the New Code written agreements will still be required but the scope for contractual restrictions will be limited.

Code Rights

The statutory Code Rights will include the following rights for the purposes of providing either the operator’s network or an infrastructure system:-

  • to install and keep electronic communications apparatus (“apparatus”) on, under or over land;
  • to inspect, maintain, adjust, alter, repair, upgrade or operate apparatus;
  • to carry out any works in connection with the installation, maintenance, adjustment, alteration, repair, upgrading or operation of apparatus;
  • to enter land to inspect, maintain, adjust, alter, repair, upgrade or operate any apparatus which is on, under or over land or elsewhere;
  • to connect to a power supply;
  • to interfere with or obstruct a means of access to or from land (whether or not any apparatus is on, under or over the land); or
  • to lop or cut back, or require another person to lop or cut back, any tree or other vegetation that interferes or will or may interfere with apparatus.

Assignation of Code Rights and Upgrading and Sharing of Apparatus

A major change will be that landowners will not be able to prevent or limit assignation of an agreement to another operator or make assignations subject to conditions to be met by the operator (including any conditions requiring the payment of money). An operator may also upgrade the apparatus or share the use of it with another operator provided that any changes as a result of the upgrading or sharing have no adverse impact, or no more than a minimal adverse impact, on the appearance of the apparatus and that the upgrading or sharing imposes no additional burden on the other party. This means that site sharing payments to landowners are likely to become a thing of the past. However, the restrictions on assignation, upgrading and sharing will not apply in respect of agreements entered into before the New Code comes into force. Landowners will still be able to require the provision of a Guarantee.

Power of Court to Impose Agreement

If an operator gives notice in writing setting out both the Code Rights and all the other proposed terms of the agreement and also states that the operator is seeking agreement to those terms and if the landowner does not agree within 28 days or at any time after the notice is given gives notice in writing to the operator that he does not agree, the operator may apply for a court order imposing an agreement. The court may make such an order if it thinks that the prejudice caused to the landowner or other relevant person is capable of being adequately compensated by money and the public benefit likely to result outweighs the prejudice to that person. The agreement must include certain provisions, including as to the payment of consideration and terms for ensuring the least possible loss and damage is caused to persons who occupy, own interest in, or are from time to time on the land.

Payments

In terms of the New Code an agreement imposed by court order must include payment of consideration by the operator and may also provide for payment of compensation for loss or damage. The consideration is to be an amount representing the market value but the market value must not be assessed on the basis of the value to the operator of the right or agreement or having regard to the use the operator intends to make of the land in question and it must be assumed that there is more than one suitable site. This is likely to reduce substantially the rents achievable in negotiations.

How may a person bring a Code Agreement to an end?

The existing code focuses on the removal of the apparatus rather than the termination of an agreement and provides that a person entitled to require the removal of the apparatus shall give a notice to the operator requiring its removal and be entitled to enforce removal if the operator does not give a counter-notice within 28 days. If a counter-notice is given an application to court for an order requiring removal is required. Similar provisions are in the New Code but it also provides that agreements may only be brought to an end by giving at least 18 months’ notice on certain specified grounds.

Will the New Code affect existing Agreements?

It is provided in the Act that the New Code is to affect existing agreements, but subject to modifications contained in Schedule 2 to the Act. These include the following provisions:-

  • the limitation of Code Rights to the right to do things listed in the existing code;
  • the restrictions on assignation of rights and upgrading and sharing of apparatus will not apply to an existing agreement. So any such restrictions in an existing agreement will remain in force.

Can the New Code be contracted out of?

Contracting out of the New Code will be prohibited.

We are continuing to monitor the position regarding the coming into effect of the New Code.