Telecoms: What does the new Product Security and Telecommunications Infrastructure Act 2022 mean for site owners?
After many months of passing through the Parliamentary legislative process the Product Security and Telecommunications Infrastructure Bill ("the Bill") received royal assent on 6 December 2022 and is now called the Product Security and Telecommunications Act 2022 ("the Act").
As reported in our earlier article "Telecoms: A better balanced Bill for site owners?", the Lords sought to make some amendments to the Bill as it passed through Parliament to try to address some imbalances for site owners. One of the later amendments proposed by the Lords, but not covered in our earlier article, was an independent review of the Electronic Communications Code ("the Code") to assess the extent to which the revisions to the Code in 2017 have secured progress towards telecommunications infrastructure targets and the balance of rights and responsibilities of landowners and operators. The Commons rejected this proposal.
Although the Bill has received royal assent the relevant sections of the Act dealing with telecommunications infrastructure (sections 57-75) have not yet come into force and we await regulations by the Secretary of State regarding commencement.
What this means for site owners
The key provisions of the Act for site owners are as follows:
1. The rights to upgrade and share apparatus will apply retrospectively to subsisting agreements and equipment installed before the 2017 Code.
The same provisions in the Code apply so that such sharing or upgrading must neither have an adverse impact on the land nor impose a burden on any person with an interest in the land. The operators must provide notice of their intention to share or upgrade and there is a caveat that this clause does not confer a right on the operator to enter onto land to upgrade or share the use of the equipment.
2. Amendments will be made to the Landlord and Tenant Act 1954 ("1954 Act") to bring renewals of subsisting agreements within the Code's valuation scheme.
This will mean that where previously site owners might have enjoyed higher rents under a renewal agreement governed by the 1954 Act, this is no longer the case as those renewals will fall under the Code's valuation scheme. This applies to court/tribunal-imposed agreements and so there is still scope for site owners and Operators to negotiate higher rents. However, the likely outcome is that rents will fall further as there is no longer the threat of 1954 Act renewal proceedings to seek a higher rent for site owners.
3. A new procedure will apply under which operators can obtain Code rights more quickly over certain types of land where a site owner fails to respond to repeated requests for Code rights.
4. The operator will be under an obligation, if it is reasonably practicable to do so, to consider the use of alternative dispute resolution procedures to reach agreement before applying to court. Whilst this is not mandatory, the tribunal can penalise a party on costs where they have unreasonably refused to engage in alternative dispute resolution.
It remains to be seen when these provisions will come into effect and the scale of the impact they will have on site owners and rents but it is clear that the balance of power has shifted a little further in favour of the operators.