Overview

The Upper Tribunal (Lands Chamber) has handed down the latest, strident judgment in a recent spate of decisions concerning the Electronic Communications Code ('the 2017 Code'). The case concerns the circumstances in which operators can obtain code rights against a landowner.

In the case of Arqiva Services Ltd v AP Wireless II (UK) Ltd [2020] UKUT 0195 (LC) the tribunal reluctantly dismissed a reference brought by the operator on the basis that it did not have jurisdiction to impose an agreement on a landowner under paragraph 20 of the 2017 Code.

This case further highlights the confusion caused by the Court of Appeal's decision in Cornerstone Telecommunications Infrastructure Limited v Compton Beauchamp Estates Limited [2019] EWCA Civ 1755 and is a clear indication that the decision in Compton Beauchamp has the potential to throw up results which (at first blush) seem contrary to the legislative intent behind the 2017 Code.

What is the 2017 Code and why was it brought in?

There are undoubtedly some very exciting technological advances on the horizon. From autonomous vehicles to the Internet of Things, all indications point to technology making our lives even easier as we progress into the Twenties and beyond. However, all of this technology needs to be supported by a robust network of cell sites which are able to handle ever-increasing amounts of data - and in order to assemble that network, telecoms operators need land on which to house their cell sites.

The regulations governing the legal relationship between operators of mobile telephone networks and the landowners who provide sites for their apparatus was ripe for an overhaul. The government duly obliged in December 2017 with the coming-into-force of the 2017 Electronic Communications Code.

The 2017 Code:

  1. sets out a suite of rights which can be requested by operators; these rights are designed to facilitate the installation and maintenance of electronic communications networks; and
  2. provides a mechanism by which an operator can procure those rights over a potential cell site (which includes the ability to refer to the Tribunal for an agreement to be imposed if a site provider is not prepared to enter into such an agreement willingly).

New Code, New Problems

One reason the 2017 Code was introduced was to solve the practical problems encountered under the previous code. Unfortunately, novel problems have now been created. In particular, it now seems difficult for an operator in situ to effectively and quickly obtain further code rights against a landowner.

One of the key elements of the 2017 Code is that it is not retrospective in its effect. Most agreements which were in force at the time the 2017 Code came into force (known as "subsisting agreements"), have remained in place subject to a limited number of additional benefits set out in the transitional provisions. The meaning and effect of the transitional provisions have troubled the Tribunal on a number of occasions. In particular, which rights under the 2017 Code are open to operators in actual occupation of sites under subsisting agreements?

The Court of Appeal's decision in Compton Beauchamp suggested that an operator who is in occupation of a site under a subsisting agreement is not able to use the 2017 Code to force an unwilling site provider to enter into an agreement. That decision led to the Tribunal holding, in the case of Cornerstone Telecommunications Infrastructure Limited v Ashloch Limited and AP Wireless II (UK) Limited [2019] UKUT 338 (LC), that an operator who is in occupation under a subsisting agreement which has security under the Landlord and Tenant Act 1954 must renew that lease under the 1954 Act rather than applying to the Tribunal under the 2017 Code; they cannot seek a new agreement under the 2017 Code.

It's fair to say this was a shock to many operators who believed the point of the 2017 Code was to make the acquisition of Code rights easier. Instead, being forced to first renew an agreement under the Landlord and Tenant Act 1954 is time-consuming and disadvantageous, particularly where operators need to move quickly to adapt or upgrade their equipment in response to national telecommunication requirements.

"I suggest, with great respect to the Court of Appeal [in Compton Beauchamp], that a wrong turn may have been taken, and that the narrow interpretation of the requirement of occupation in the Code leads to results that are unacceptable in terms of the policy of the Code." Judge Elizabeth Cooke, Arqiva Services Ltd v AP Wireless II (UK) Ltd [2020].

The Arqiva decision

In this latest case, the Tribunal reluctantly came to the view that it was bound by the Court of Appeal's decision in Compton Beauchamp to dismiss a reference made by Arqiva, who occupied the site under a subsisting agreement.

The Tribunal reached several interesting decisions over the nature of Arqiva's occupation (which it said was as a tenant at will following the expiry of a previous agreement which was outside of the terms of the Landlord and Tenant Act 1954). But the really interesting part of the decision was the Tribunal's thinly-veiled criticism of the Court of Appeal's decision in Compton Beauchamp, which led to a decision which described as "inconsistent with the policy of the [2017] Code". In particular, the Tribunal found it "baffling" that an operator should be debarred from obtaining rights under the 2017 Code simply because it is in occupation of the site in question - especially in circumstances where the operator would be in a much more favourable position if they were not in occupation at all. Finally, the Tribunal suggested - with the greatest of respect to the Court of Appeal, that "a wrong turn may have been taken" in Compton Beauchamp and that the restrictive interpretation of the 2017 Code in that case is contrary to the clear intention of the 2017 Code.

The way forward?

The decisions in both Compton Beauchamp and Ashloch are in the process of being appealed. Ashloch heads to the Court of Appeal in January 2021, and permission to appeal to the Supreme Court has just been granted in Compton Beauchamp. The judge in Arqiva took the unusual decision of indicating that she would grant permission for Arqiva to appeal if such an application were to be made. 2021 already looks to be a busy year for appellate telecoms decisions.

It is clear that - with so many telecoms sites across the country, and a clear imperative on operators to safeguard and strengthen their networks - it is of vital importance that we receive some judicial clarity on the transitional provisions to the 2017 Code to avoid further cases like this where the Tribunal is bound to give a decision which it clearly finds unsatisfactory.