Proposed Changes to the Electronic Communications Code: What you need to know

Current Position

Modification

Consequences

Harmonisation of renewal processes under the Code and the Landlord and Tenant Act 1954

•  There are different procedures for renewing agreements governed by the Code and subsisting agreements protected by the Landlord and Tenant Act 1954 (the '1954 Act').
• Where a subsisting agreement is protected by the 1954 Act, it must be renewed under the 1954 Act.
• There are differences between the 1954 Act renewal process and the Code renewal process (including which assumptions apply and the venue for the renewal).

• The differences between the Code and 1954 Act renewal processes will be substantially removed.
• The 1954 Act will be amended to adopt the Code valuation assumptions for telecoms leases.
• The Tribunal rather than County Court is to hear renewals of subsisting agreements under the 1954 Act.

• Simplifies what is an unnecessarily complicated position.
• Some circumstances where the modification to the 1954 Act assumptions will reduce the rent on 1954 Act renewal leases.

Clarification of Sharing Rights

• The right to share is not a standalone Code Right.
• Operators have an automatic right to share apparatus, which can be subject to only limited restrictions.
• There is uncertainty as to the extent to which the Tribunal could impose wider rights to share apparatus.

• Introduction of additional standalone Code Rights to share apparatus and to access land in connection with sharing.
• The statutory purpose behind the Code is to be amended to include operators enabling the provision of other operator’s networks.
• An operator under a Code Agreement can permit a sharer to exercise rights under that Code Agreement.

• Helpful to operators, particularly Passive Infrastructure Sharers, whose business model relies on a wide-ranging ability to share apparatus.
• Concerning for site providers faced with operators being granted unlimited rights to share or upgrade apparatus located on their land.

Grant of Code Rights over operator occupied site

• Code Agreements cannot be imposed on a landowner who is not in occupation of the relevant site, including where the site is occupied by an operator.
• This position poses significant issues for some operators, particularly those holding over under a tenancy at will.
• There is considerable litigation on this point including pending appeal to the Supreme Court.

• Where a site is occupied by an operator, code rights will be able to be imposed on a non-occupier exercising powers of management or control over that land.
• In the absence of such a person, code rights will be able to be imposed on a person whose interest in the land would be prejudicially affected by the exercise of those rights.

• Will clarify a problematic aspect of the Code.
• Deprives site providers in certain circumstances of leverage they were able to exercise under the Code (as previously interpreted by the Tribunal and Court).

Unresponsive Land Owners

• No separate process under the Code to impose agreements on unresponsive land owners.
• Process introduced in 2021 to impose agreements on non-responsive owners of buildings in multiple residential occupation not yet in force.

• Rights will be able to be imposed on an unresponsive land owner if a prescribed notice process is followed.
• Only applies to the installation of apparatus over or under (but not on) bare land.

• Will assist operators with installing lines over or under land in rural areas.
• Site providers and/or managers of bare land should be on the alert for notices from operators.

Sharing/Upgrading Rights of pre-Code underground apparatus

• The automatic right to share and upgrade apparatus does not apply to agreements pre-dating the Code.
• The controls on sharing and upgrading which are in place in subsisting agreements can still be enforced by site providers.

• Proposed introduction of limited automatic rights to upgrade and share apparatus to apply retrospectively to subsisting agreements.
• Limited to underground apparatus.
• Limited to where no adverse impact on the land and will impose no burden on the other party to the agreement.
• Specific notice procedure to follow.
• Similar process for upgrading and sharing apparatus where there is no agreement but the apparatus was installed before 29 December 2003.

• Should assist fixed line operators in entering into sharing rights under pre-existing apparatus.
• Owners and managers of land subject to pre-Code agreements concerning underground apparatus should be on the alert for such notices.

Changes to Pending Code Agreements

• During application to renew or modify an expired Code Agreement, the Tribunal can determine the consideration payable pending the determination of the application.
• No modification of other terms pending the outcome of the proceedings.

• The Tribunal will be able to modify other terms of the agreement pending the outcome of the proceedings.
• When doing so the Tribunal must have regard to all the circumstances of the case.

• Will allow operators to seek to impose their current standard terms on site providers pending the determination of proceedings.
• Site providers resisting modified terms proposed by operators should be aware that they may be subject to these terms pending the outcome of proceedings.

Alternative Dispute Resolution (ADR)

• There are no specific provisions within the Code to encourage the use of Alternative Dispute Resolution (ADR).
• The Tribunal has shown its willingness to impose costs sanctions on parties which it perceived to have behaved unreasonably in proceedings.

• Introduction of various measures to encourage the use of ADR, with the onus being on the operator.
• Operators will be required to consider the use of ADR before applying to the Tribunal.
• Notices served by operators must note the availability of ADR and explain the consequences of refusing to engage in ADR.

• Reminder of the importance of ADR in disputes.
• Operators need to update their standard form notices.

Code of Practice

• OFCOM is under a statutory duty to provide a Code of Practice.

• The Code of Practice will address the handling by operators of complaints.

• Operators should be aware that there will be further guidance on handling complaints.