Electronic Communications Code – points of note for landowners

19 March, 2018

Charities and not-for-profit organisations that own property (“landowners”) and are considering entering into agreements with electronic communications companies (“operators”) to install electronic communications apparatus on their properties should be aware of the new Electronic Communications Code (“the Code”) which came into force on 28 December 2017.  This blog will focus on the main changes that have been made which will apply to all electronic communications apparatus agreements completed after 28 December 2017 and does not cover the transitional provisions which affect existing agreements entered into before this date:

 

  1. An operator now has the statutory right to assign their Code rights without needing consent from or making payment to the landowner. Any clause which tries to prevent or restrict this assignment right will be void.  Landowners won’t be able to control who the operator assigns to and they won’t be able to benefit financially from an assignment.

  2. An operator has the statutory right to upgrade its apparatus and share that apparatus with another operator so long as any changes made to the apparatus have no/minimal adverse impact on its appearance and no additional burden is imposed on the landowner. Any attempt to prevent or limit this right will be void.

  3. Usually, a landowner will enter into an agreement voluntarily with an operator. Where this is not the case, the Court may impose Code rights on the landowner.  Any rent payable under an agreement imposed by the Court will now be based on the “market value” of the property to the landowner rather than the value of the property to the operator.  If the market value of a property is low (e.g. rooftop), then the level of rent a landowner could get could be lower than they may have expected.

  4. An operator can no longer have protection under both the Code and the Landlord and Tenant Act 1954 (“LTA 1954”). If the primary purpose of the lease is to grant Code rights, then only the Code will govern the termination of the agreement. If the primary purpose of the lease is actually so that the property is occupied for a different purpose, any termination will be dealt with under the LTA 1954.

  5. Code rights continue to exist even if an agreement with an operator has expired unless they are terminated in accordance with the Code. Landowners must now give 18 months’ notice to an operator to terminate a Code agreement stating a statutory ground for the termination such as a substantial breach made by the operator or the landowner intends to redevelop their land.  The operator can serve a counter-notice which will mean the termination procedure will be dealt with and decided by the Court.

  6. Landowners must follow a statutory procedure if they wish to remove electronic communications apparatus on their property. This procedure is in addition to the procedure from termination.  So long as one or more of five conditions are met (e.g. the Code no longer applies to the operator), a landowner can give notice to the operator requiring the apparatus to be removed and the land to be restored to as it was before the apparatus was installed. If no agreement is reached on the key terms of the removal, the Court will decide.  If a court order is made and an operator doesn’t comply with it, the landowner can make further applications to the Court for the removal of the apparatus.

 

Any landowners thinking of entering into a new agreement should be aware that it isn’t possible to contract out of the new Code.  The new Code also does not include “lift and shift” provisions so landowners should consider including these provisions in their agreements.  Landowners should plan ahead and consider what they want to use their property for in the future, especially if they are considering developing their property.  If a landowner will need to terminate any Code rights and remove apparatus to develop their property, a landowner will need to factor in the time it may take to do this into their proposed development timetable.

 

If you require any further information on anything covered in this note please contact rebecca.crosdil@cripps.co.uk.