The Law Commission's report on reform of the Electronic Communications Code was published in February 2013, following a consultation that ended in October 2012. Although the government announced last December that it would bring forward reforms to the Electronic Communications Code, it has come as a surprise to many that a new Code has been inserted into the Infrastructure Bill, which is currently before the Public Bill Committee in the House of Commons.
Property professionals, land owners and telecoms operators alike will be scrutinising the fine detail of the new Code, which (if approved by Parliament) will be included as a new Schedule in the Communications Act 2003. In keeping with the Law Commission's recommendations, the Code has been completely rewritten in modern language and style, to make its effect clear and to remove various uncertainties that the previous Code created. This is an encouraging sign but only time will tell whether the new Code is sufficiently unambiguous to avoid potential bear traps for unwary landowners.
Whilst the language of the Code has been drastically improved and major issues ironed out, the basic principles of the regime remain the same. A telecoms operator who enters into an agreement with a landowner, enjoys "Code rights" which it can assign to another operator without the landowner's consent. The Code further confirms that whilst the agreement may be in the form of a lease, any term which prohibits or limits the operator's right to assign will be unenforceable. However, the landlord can require the outgoing telecoms operator to enter into an "Authorised Guarantee Agreement" guaranteeing the assignee's obligations.
It remains the case that, following expiry of an agreement between a landowner and telecoms operator, the operator's "Code rights" will continue indefinitely unless brought to an end under the Code. This requires 18 months' notice by the landowner who must establish that certain criteria have been met (such as an intention to redevelop or where the operator has persistently breached its contractual obligations). However, this can only apply where the primary purpose of the agreement was for the landowner to grant Code rights to the operator. A telecoms operator will not be able to rely both on Code rights and a statutory right of renewal under the Landlord and Tenant Act 1954 to resist a landowner's attempts to recover possession once the telecoms agreement has expired.
The Code that has appeared in the Infrastructure Bill may yet be subject to further scrutiny from Parliament but it is unclear what (if any) further opportunity there will be for the industry to comment before it is enshrined in statute. In the initial analysis, however, the new Code seems to address most of the major issues that gave Lord Justice Lewison reason to describe the original Code as "one of the least coherent pieces of legislation on the statute book". The manner in which the new Code so swiftly and unexpectedly enters the statute book may prove to be a missed opportunity for further reform but it will be a cause of relief to many that the Commission's recommendations have been adopted and codified.