COMMENT On 27 January 2021, the Department for Digital, Culture, Media & Sport issued its consultation “Access to land: consultation on changes to the Electronic Communications Code”, which concluded on 24 March. It cites a report which suggests that the average time for agreements to be completed is 11 months, with 80% taking more than six months. Nearly a third of negotiations stall, presumably with no agreement being reached.
Encouraging consensual agreements
Despite the issue of compensation playing a large part in the difficulties in brokering agreements – with operators routinely offering rock-bottom compensation from the off – the consultation makes it clear that there is no intention to revisit the “no scheme” valuation protocol. Instead, the proposal is for the introduction of a statutory process for raising complaints about non-compliance with the Ofcom Code of Practice, making an alternative dispute resolution scheme available and fast-tracking court procedures.
Of course, nominal levels of compensation aren’t the only problem. Landowners who host operators’ equipment will often find little benefit for occupiers. The lack of any real benefit constitutes a lose-lose for landowners – they are expected to provide 24/7 access to operators (often making it difficult to balance existing third-party rights) and receive inadequate compensation while seeing no improvement in service.
There are also real issues around redevelopment. The disconnect between the notice period under the Landlord and Tenant Act 1954 (six to 12 months) and that under the Code (18 months) has long been problematic for landowners. The failure to reference these issues is a serious omission, since it would be fair to assume that there would be considerable support for an amendment to the Code to bring the 18-month period down to match that contained in the 1954 Act. The failure to tackle this point in the context of the difficulties of encouraging consensual agreements is therefore a major oversight.
Upgrading and sharing
At present, even where an operator does not have an explicit right to upgrade (ie a paragraph 3(c) right, conferred either by agreement or following an application to the Upper Tribunal (Lands Chamber)) it can avail itself of limited rights to upgrade and share contained in paragraph 17, so long as two conditions are met. These are that changes do not:
(i) have an adverse impact on the appearance of apparatus; or
(ii) create an additional burden on one party to the agreement, subject to agreed terms.
The consultation seems to propose to add an additional layer of detail into the Code with regard to the conditions set out above, to make it clear that installing new or further equipment (even where existing installations are retained) falls within the scope of paragraph 17. The premise seems to be that there is sufficient flexibility within the existing wording of paragraph 17 to effectively expand the automatic rights, without needing to rewrite the existing wording of the Code itself. An expansion of automatic rights in this respect would tip the balance further in favour of operators, however, which in turn may lead to further reticence by landowners to enter into agreements.
Further, referencing the approach of the UT in Cornerstone Telecommunications Infrastructure v University of the Arts London [2020] UKUT 248 (LC); [2020] EGLR 36 and Cornerstone Telecommunications Infrastructure Ltd v London & Quadrant Housing Trust [2020] UKUT 282 (LC); [2020] PLSCS 187, the consultation states that one of its aims is to make clear that the tribunal has a wider jurisdiction to impose rights to upgrade and share beyond paragraph 17 and to make clear that this should apply where the tribunal is imposing either a new agreement or a renewal agreement.
Modifying existing agreements
At present under the Code, while the parties can voluntarily agree to modify an agreement, there is no jurisdiction for one party to apply to the tribunal and force a change on the other party.
The consultation queries whether the status quo in this respect should continue, including with regard to upgrading and sharing rights. This would effectively allow operators to keep the terms of agreements under continual review, and place a further burden on landowners. At present, once an agreement is completed, a landowner has the peace of mind that the terms will continue in force for the duration of the agreement. Conferring an ability on an operator to bring existing agreements back for further expansion of the rights conferred under the same would increase the burden on landowners and surely fuel scepticism further.
Expired agreements
With regard to expired agreements, the consultation states that the Code, as enacted, was intended to create “steady phasing in of new Code rights” through transitional arrangements.
The document identifies a means of achieving this intended expansion by rolling out the provisions of Part 5 “to apply in all cases”, ie to those “previously subject to different statutory regimes”. This would, seemingly, bring in agreements currently within the 1954 Act. Such a change would reverse the effect of the decision in Cornerstone Telecommunications Infrastructure Ltd v Ashloch Ltd and another [2021] EWCA Civ 90; [2021] PLSCS 25, and would narrow the grounds available to a landlord to refuse a renewal, such as the right to refuse where the landowner wishes to use the land for his own business purposes.
A missed opportunity?
Resetting some of the known issues with the Code is no easy task, but there is little of comfort for landowners in the government’s proposals.
Laura West is a senior associate (barrister) in the real estate litigation team, Pennington Manches Cooper LLP
