The recent advances in technology have changed our lives beyond recognition. We rely on digital technology to communicate, to entertain and to work. It is a fundamental part of our lives and relies on high level infrastructure providing guaranteed networks.

Back in 1984 legislation was put in place to protect those networks. The Telecommunications Act 1984 dictated how telecommunications apparatus on spaces across the land should be installed, relocated and removed whilst ensuring an endless stream of uninterrupted communication.

That demand places increasing pressure on operators to source sites for their apparatus, engaging landowners looking to make money from what is often unused space. Unfortunately, what ultimately results is a conflict between the operators’ objective of maintaining communication and the landowners’ freedom to develop or regain control of their land.

It is widely accepted that the 1984 legislation was inadequate – famously described as “one of the least coherent and thought through pieces of legislation in the statute book” by one of our most senior judges. It seems ironic that legislation intended to govern modern communication could cause so much confusion and uncertainty.

For several years there has been pressure to introduce new legislation, and The Digital Economy Act 2017 (“the Act”) came into force on 28 December 2017. Ed Vaizy (the former Minister of State) said that this was intended to acknowledge the economic benefit for all of society from investment in digital infrastructure whilst also balancing it with the rights of land owners.

The new legislation brings with it various changes, many of which have the effect of increasing the freedom available to telecoms operators and consequently restricting landowners’ ability to control and deal with their land. The key provisions include:

1.Code Rights

The Code gives operators the ability to install, inspect, carry out works, connect to a power supply and interfere with access.

2.Code Agreements

Operators can only exercise Code Rights if they are party to a Code Agreement with the landowner. These must be in writing, signed by both parties, state the length of time the rights are exercisable for and the termination notice period. Landowners should be careful of inadvertently granting Code rights – signed heads of terms could constitute a Code Agreement. There is no requirement for Code Agreements to be registered. Purchasers of land may be bound by agreements so site inspections are crucial.

3.Alienation

Operators are free to assign and share their interests in sites. Whilst common practice in the industry, this gives less control to landowners. Options to landowners include obliging operators to give details of alienation arrangements, or imposing guarantees if an assignment takes place.

4.Upgrading apparatus

This is permitted provided that the impact on the appearance of the site is minimal with no additional burden on the landowner. This removes the landowners’ ability to request a premium. It is unclear whether incremental changes to the apparatus will be compared with the original installation or previously upgraded apparatus.

5.Imposing Code Agreements

Agreements can be imposed on landowners by the courts where the landowner is capable of being compensated, and where it is in the public interest for apparatus to be put in place. Landowners can only oppose an agreement where they can evidence redevelopment plans.

6.Rents

Rents under Code Agreements are based on market value. However, they are subject to various assumptions in relation to issues such as use and alienation. These assumptions potentially have the effect of weakening landowners’ negotiating positions. The government’s aim is to ensure that landowners do not profit from an increased public demand for data.

7.Relocation

Landowners have no right under the Code to require the relocation of apparatus and should negotiate contractual rights if necessary.

8.Security of tenure

Code Agreements benefit from security of tenure (the right to remain in a property) under the new legislation, but the Landlord and Tenant Act 1954 does not apply.

9.Termination and removal of apparatus

The Code provides for significant changes in this area.

There will be more developments in this area as the provisions are put into practice. We will comment on those and review the procedure for the termination and removal of the apparatus in our next commentary.

by Karen Taylor
Associate Partner (Litigation)