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Landlords face telecoms time bomb over electronic communications code amendments

Posted on 6 November 2019

More bad news for landlords as the government looks to make it easier for operators to acquire interim Code rights.

The government has recently announced plans to amend the new Electronic Communications Code (the "Code"). The move is likely to increase the friction between landlords and operators that has been building steadily since the Code, which is widely seen as very operator friendly, came into force in December 2017.

In an (arguably misguided) effort to encourage operators to invest in the 5G rollout, the Code introduced the "no scheme" basis of valuing land. This disregards the value of the land to the operator with their equipment in situ and instead calculates payments by reference to the underlying value of the land. As a result, rents for telecoms sites have plummeted, and landlords have become ever more wary of allowing operators onto their land.

The government is now proposing to make it easier and cheaper for operators to obtain so-called interim Code rights, which allow operators to install equipment on land for a set period. Currently operators can obtain such rights by making an application to the Upper Tribunal (Lands Chamber). The hurdles an operator has to overcome to obtain interim Code rights are significantly lower than for permanent rights, but at the end of the set period the operator must apply for permanent rights if they wish the equipment to remain.

The government's initial proposals envisaged landlords being able to apply to the magistrates' court for a warrant of entry. These proposals appear to have been abandoned in favour of an expedited version of the existing arrangements. In circumstances where a tenant has made a service request of an operator and the landlord has repeatedly failed to respond to the operator's notice seeking Code rights, the operator will be able to apply to the Upper Tribunal (Lands Chamber). The operator will be granted interim rights to install equipment for up to 18 months if it can provide evidence that it has repeatedly attempted to contact the landlord and has otherwise complied with the Code.

The government's hope is that these proposals will "increase the response rate to requests for access and support tenants’ access to high quality networks".

Landlords have argued that the move is unnecessary, as operators can already obtain Code rights fairly quickly - the Upper Tribunal processes applications for Code rights in under six months. It has also been suggested that interim rights allow operators to circumvent the provisions of the Code, which are designed to protect a landlord when an operator seeks permanent rights.

The government's proposals are a further example of the way landowners' property rights are at risk of being compromised by the Code and are likely to do little to improve the already fraught relationship between landlords and operators.

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