New Electronic Communications Code brings changes for site providers who are operators

The Electronic Communications Code gives licensed telecoms operators statutory rights to have equipment on private land. The Digital Economy Act 2017 contained a new Code with sweeping changes in favour of operators.

Main drawbacks of the new code for site providers:

• Site sharing: regardless of the terms of any written agreement, telecoms operators can share sites without the landowner’s consent. Landowners can no longer insist on sharing the income from operators sharing sites.
• Site dealings: regardless of the terms of any written agreement, telecoms operators can transfer their leases without landowners' consent
• Upgrades: so long as any adverse visual impact is at most minimal and no extra burden is placed on the landowner, telecoms operators may upgrade equipment without landowners' permission. 
• Valuations: Telecoms sites had been valued on an open market basis. Under the New Code they will be valued on a 'no scheme' basis where the existence of telecoms leases and the telecom operator’s rights will be disregarded. So compulsory purchase principles will be applied merely to value the land lost to the mast and equipment cabins and any adverse impact. This will greatly reduce landowners' income from operators. 
• Terminating code rights: Here there has been a welcome clarification of grounds. But landowners must serve a notice specifying the date when the agreement is to cease. That date must be at least 18 months from the date of notice and the contractual term of the lease must have expired by the end of that 18 month period. The telecoms operator then has three months to serve a counter-notice on the landowner and a further three months to apply to court. Even when the court has terminated the agreement the landowner then has to reapply to court to get the equipment removed unless the telecoms operator removes it voluntarily in the meantime.
• Retrospectivity: The New Code’s sharing, assignment and upgrading rights will not apply to leases granted before it came into force on 28th December 2017.

Not unnaturally site providers are keen to avoid the New Code applying if they can.

It was the policy of the New Code that the New Code was not to be asserted by Telecoms Operators against other Telecoms Operators. Such arrangements were to be regulated by OFCOM. The easiest way to have achieved this would have been for the New Code to exclude itself giving Operators rights against other Operators or applying to any other Operator’s electronic communications apparatus.

Instead, the New Code draftsmen modified the New Code’s definition of “Land” over which all code powers are exercised “to expressly exclude “electronic communications apparatus”.  

Save for that exclusion “land” includes anything and everything annexed to it.

The New Code defines “electronic communications apparatus” to mean:

“(a) apparatus designed or adapted for use in connection with the provision of an electronic communications network, ... and

(d) other structures or things designed or adapted for use in connection with the provision of an electronic communications network."

This distinction between “apparatus” and “structures or things” is significant.

As a matter of law a “structure” is a composite thing put or built together from a number of different things.

All “buildings” are “structures”, but not all structures are “buildings.”

A motorway embankment may be a structure but not a building.

This has created artificial distinctions.

Antennae may be attached to “structures”, which are not obviously electronic communications apparatus such as grain silos, overground gas mains, bridges and aqueducts.

None of those structures will have been “designed” for “use in connection with the provision of an electronic communications network”, but they may or may not have been made suitable or modified (i.e. “adapted”) for such use.

Strange results will arise from pursuing the concept of “adaption” to its semantic conclusion – illogical though the outcomes may appear.

The act of attaching an antenna to a “structure” may or may not make the structure “adapted” for “use in connection with the provision of an electronic communications network” but strengthening that structure to take the weight and windloading of the antenna would make the structure “adapted”.

A single cable may sit in established channels or bespoke cable carrying trays may added to support the cable. Where the cable sits in an existing channel, the channel would be “land” and so Code rights would apply. If the cable sits within a tray added to the channel, the channel would have been adapted and so would be itself electronic communications apparatus and Code rights would not apply.

Similarly attaching brackets to a motorway embankment would be “adapting a structure for use in connection with the provision of an electronic communications network” so any electronic communication apparatus attached to those brackets would be attached to “electronic communications apparatus”, not land, and so the New Code would not apply to them.

However the position would be different if the brackets were attached, not to a motorway embankment, but instead to the parapet walls of an office roof. This is because Paragraph 5(3) of the New Code says that a “structure” only includes a “building” if the sole purpose of that building is to enclose other electronic communications apparatus.

This introduces fresh uncertainty. A water tower or grain silo may or not be a “building” as well as a “structure”.

Worst still the New Code only excludes new leases from security of tenure under the Landlord and Tenant Act 1954 where their “primary purpose” is the grant of Code Rights. If it is uncertain whether the New Code applies how can such be the "primary purpose"? Where there is doubt it would be as well to continue old lease contracting out procedures.