Précis

On 26 July 2016, in accordance with the requirements of the Communications (Access to Infrastructure) Regulations 2016 (the “ATI Regulations”), Ofcom released a consultation setting out its proposed guidance on how it will handle disputes referred to it under the ATI Regulations (the “Draft Guidance“).

What?

The ATI Regulations came into force on 31 July 2016 and introduced measures to reduce the cost of deploying high-speed electronic communications networks, part of the Government’s strategic vision for ensuring that the country is at the leading edge of the global digital economy.

The ATI Regulations create a series of new rights over ‘infrastructure operators’ whereby ‘network operators’ can, in short, obtain information about, conduct a survey on or gain access to the ‘physical infrastructure’ of such infrastructure operators.

Organisations that fall within the definition of ‘infrastructure operators’ include:

  1. providers of public electronic communications networks (network providers);
  2. undertakings providing physical infrastructure intended to provide a service of production, transport, transmission or distribution of gas, electricity (including public lighting), heating or water (including disposal or treatment of waste water and sewage and drainage systems); and
  3. undertakings providing physical infrastructure intended to provide transport services (including railways, roads, ports and airports).

The significance is the extension beyond electronic communications undertakings to infrastructure providers across other industries and sectors (in particular electricity/gas distribution, water and sewerage companies and transport services)

The measures set out in the ATI Regulations are intended to reduce the cost of deploying high speed electronic communications networks (ie networks that are capable of delivering access to broadband access services at speeds of at least 30 megabits per second (30Mbits/s), in accordance with the requirements of the Broadband Cost Reduction Directive 2014). In summary these measures include the rights to:

  1. access information about physical infrastructure;
  2. request and carry out surveys of the physical infrastructure;
  3. access physical infrastructure;
  4. access in-building physical infrastructure;
  5. obtain information concerning civil works; and
  6. co-ordinate civil works that are being carried out from public funds.

The ATI Regulations also provide that where any disputes arise from requests made pursuant to the rights set out at (a) to (f) above the matter may be referred to Ofcom for resolution. Under the ATI Regulations Ofcom was required to issue guidance on how it expects to handle any such disputes.

The ATI Regulations provide for disputes to be referred to Ofcom where “there is no real prospect of the dispute being resolved without that reference”. In the light of the above, Ofcom’s dispute resolution functions will be crucial.

The most significant right introduced by the ATI Regulations is the right granted to access an infrastructure operator’s physical infrastructure. In the exercise of that right it is likely that disputes will arise in relation to the terms on which access is sought. The infrastructure operator must agree to provide access on ‘fair and reasonable terms’ (including price) within two months of the request being made.

So what?

The purpose of Ofcom’s consultation on the Draft Guidance is to make it clear to stakeholders how to refer a dispute to Ofcom under the ATI Regulations, how such disputes will be dealt with and to provide an indication on the issues that Ofcom is likely to take into consideration where disputes are referred to it. The Draft Guidance broadly addresses the following areas:

  1. the form and manner in which disputes should be referred to Ofcom;
  2. the process, information and evidence Ofcom will require to determine whether a dispute meets the necessary statutory requirements for the dispute to be handled by Ofcom;
  3. the information that Ofcom would expect the parties to submit to enable Ofcom to properly determine the dispute;
  4. the remedies available to Ofcom to resolve disputes referred to it; and
  5. the likely considerations that Ofcom will take into account in reaching a determination in disputes referred to it.

Ofcom has broad powers to make a determination subject to a time limit of four months in relation to access disputes and two months in all other cases unless there are ‘exceptional circumstances’. Ofcom’s formal process for resolving disputes involves two phases, the Enquiry Phase (typically lasting 10-15 days) to determine that the statutory grounds for referring a dispute to Ofcom have been met and the Resolution Phase in which Ofcom investigates and determines the dispute. In making its final decision on a dispute Ofcom can make declarations, fix terms in transactions, give directions and order parties to pay costs.

The consultation closed on 4 October 2016. Ofcom has confirmed it will consider all responses and issue final guidance around the end of the year. It will apply the draft guidance to any disputes it is required to determine in the meantime.