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Operators beware! Upper tribunal confirms a black hole within the telecoms code

The Upper Tribunal has controversially held that operators remaining in occupation of sites under agreements that expired prior to the Electronic Communications Code 2017 (the Code) coming into force may have no basis upon which to oppose removal or seek renewal.

The key policy driver behind Parliament’s reform of the Code in 2017 was to drastically improve the public’s access to a choice of high-quality electronic communications services. However, the tribunal has recently interpreted the complex provisions of the Code in such a way as to be entirely contrary to this policy.

Facts

In 1997 Arqiva was granted a 20-year lease of a greenfield mast site in Northamptonshire and occupied it for the purpose of providing infrastructure for mobile operators.

That lease, contracted out of the 1954 Act, expired in 2016 and while negotiations for a new lease were intermittently pursued, none was ever completed. Arqiva simply remained in occupation of the site and paid rent to the landowner in accordance with the terms of the expired lease.

In 2019, some two years after the Code had come into force, Arqiva sought to regularise its occupation by seeking a new Code agreement from the landowner. Following the

Court of Appeal’s decision in Compton Beauchamp and the tribunal’s subsequent decision in Ashloch, it is clear that:

  • an operator can not use the procedure under paragraph 20 of the code to obtain a brand new Code agreement for a site where the operator itself is in occupation of it.
  • the ability to renew a code agreement under paragraph 33 of the Code is only available where an operator had a subsisting agreement as at the date the Code came into force (28 December 2017).

Unfortunately for Arqiva, it was in occupation of the site and did not have a subsisting agreement. On the face of it, it therefore fell squarely into a black hole between these two mechanisms for regularising its continued occupation of the site.

Arqiva sought to extricate itself from this dilemma by simultaneously serving a notice seeking temporary Code rights under paragraph 27 of the Code and a notice seeking a full new code agreement under paragraph 20 of the Code.

The tribunal was invited to consider whether this innovative approach enabled Arqiva to obtain a new Code agreement, despite being in occupation of the site itself.

Temporary rights are not a gateway to enable operators to successfully apply for a new Code agreement

The tribunal noted that paragraph 27 of the Code is highly prescriptive as to when an operator can seek to obtain temporary rights. Namely an application under paragraph 27 can only be made if:

  • the operator has served a notice on the landowner under paragraph 20 of the Code.
  • the operator already has electronic communications apparatus on the site.
  • the landowner has the right to seek the removal of the apparatus (i.e. there is no agreement in force between the parties).

It was accepted that all three of the conditions were satisfied in this instance, such that Arqiva were prima facie entitled to apply for temporary rights.

Paragraph 27(4)(b) of the Code states that any temporary code agreement is deemed to take effect on the assumption that the landowner is in occupation of the site, whether or not that is actually the case. Arqiva sought to argue that this same deeming provision should be given a wide interpretation and also apply to its simultaneous application under paragraph 20 for a full new Code agreement.

The tribunal agreed that such an interpretation would enable Arqiva to circumvent the issues experienced by the operator in Compton Beauchamp (where the operator was unable to seek a new Code agreement under paragraph 20 because it, rather than the landowner, was in occupation).

It considered that such an interpretation would also be consistent with both the policy behind the Code and the statutory purpose behind the ability to apply for temporary rights and that the unpalatable alternative was that Arqiva would have to incur the cost of decommissioning its apparatus and vacating the site, before making a fresh application to the landowner under paragraph 20 to reoccupy it. During that intervening period, the public would be deprived of the benefit of the electronic communications services hosted by Arqiva on the site.

However, the landowner drew the tribunal’s attention to obiter remarks made by Lord Justice Lewison in the Court of Appeal’s decision in Compton Beauchamp, which gave a narrow interpretation on paragraph 27(4)(b) and stated that the deeming provision applied for the purposes only of the conferral of the temporary Code rights.

Whilst the tribunal clearly found the Court of Appeal’s narrow interpretation troubling and went so far as to suggest that it may have taken a wrong turn in doing so, it also accepted, reluctantly, that it was bound to follow its view.

As such the tribunal held that whilst Arqiva was fully entitled to seek the imposition of temporary Code rights pending the conclusion of any action by the landowner to enforce its removal from the site, it was not entitled to seek the grant of a new Code agreement.

Temporary rights themselves rendered toothless

The tribunal noted that the statutory purpose behind paragraph 27 is expressly stated as being the maintenance of the service provided by the operator’s network until such time as the proceedings under paragraph 20 (application to obtain a new code agreement) or paragraph 40 (removal of the apparatus) are concluded.

However, if an operator in situ can not successfully pursue an application for the grant of a new Code agreement, it means that temporary rights can only be obtained in the limited scenario where the landowner is taking active steps to seek removal and the operator simply wants to maintain its network coverage until that process concludes.

The tribunal made it plain that this narrow interpretation of temporary rights was wholly at odds with both the statutory purpose expressed in paragraph 27 and the Code’s explanatory notes. However, it accepted it as an unfortunate consequence of its decision that paragraph 20 was not available to Arqiva.

In this particular instance, because the landowner was not actively seeking Arqiva’s removal, the tribunal found that there was no basis upon which the application for temporary rights could be sustained and so struck it out.

Comment

While the tribunal’s evident reluctance to come to the conclusion that it did, along with the suggestion that Arqiva may wish to seek an expedited appeal, are indicative of a decision that is unlikely to be good law for long, in the interim there are likely to be hundreds of sites throughout the UK that are directly affected by it.

Not only does it mean that operators are unable to regularise their ongoing occupation of such sites (the tribunal even expressed uncertainty about whether a new Code agreement could be consensually agreed with the landowner), but they will understandably be concerned about the prospect of quick-thinking landowners taking the opportunity to try and enforce their removal from such sites.

Arqiva Services Limited v AP Wireless II (UK) Ltd [2020] UKUT 195 (LC)

Disclaimer

This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.

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