Revised Electronic Communications Code - Code Red for Landowners

A revised new Electronic Communications Code has been introduced as one element of the recent Digital Economy Act 2017 (see our TMT ebulletin of 22 May 2017). The existing Code has long been declared unfit for purpose, hopelessly out of date and badly drafted. Introduced in 1984 to deal with the privatisation of British Telecom, it was tweaked slightly by the Communications Act 2003 but failed to keep pace with advances in digital communications technology and the public's relentless appetite for electronic services.

The government has comprehensively overhauled the Code and aims to help operators expand their networks and upgrade infrastructure by lowering the cost and simplifying the roll out of such infrastructure. This is driven in particular by operators seeking to improve the data rich services sought by both consumers (such as video, social media and gaming services) and businesses (such as cloud-based services and those in respect of connected devices) as a result of rapidly emerging digital technologies and handset capabilities. These applications consume increasingly higher bandwidths and will require faster broadband speeds if operators are to meet future capacity, quality and reliability expectations. Operators were given enhanced permitted development rights at the end of last year, to the same end.

The new Code has not been welcomed by landowners, but the government has stated that it is simply putting communications on the same footing as other essential utilities such as water and energy.

In a nutshell

The changes to the Code will:

• lower the threshold for compulsory imposition of code rights on unwilling site providers (landowners, tenants and occupiers);
• supress rents on some sites, such as rooftops, by disregarding their economic value to operators;
• give operators automatic rights to upgrade, assign and share occupation of sites with other network operators at no additional cost and, in most cases, without landowners' consents;
• remove the current overlap that exists at the end of code agreements between continuation of rights under the Code and security of tenure protection for business tenancies under the Landlord and Tenant Act 1954; and
• give landowners a statutory right to terminate agreements for redevelopment purposes (but at the cost of substantially increased notice requirements).

The new Code awaits regulations to bring it into effect, and once in force, it will not be retrospective. Ofcom recently completed a consultation on a proposed Code of Practice, various template notices and standard terms to be used in tandem with the new Code, so the communications industry may have to wait a little longer for implementation.

We are preparing a Client Guide on the new Code.  If you would like to receive a copy, please contact us.

Author: Deborah Caldwell, Professional Support Lawyer, Real Estate, London

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