In R. (on the application of VIP Communications Ltd) (In Liquidation) v Secretary of State for the Home Department  EWHC 994 (Admin), the High Court quashed a direction given by the Secretary of State to Ofcom, which purported to limit the use of telecoms devices known as “GSM Gateways” on national security grounds. The Court held that the direction was ultra vires, on the basis that it conflicted with primary legislation.
- The judgment provides useful guidance on the approach to construction of conflicting duties imposed on regulatory bodies by primary and secondary legislation.
- Clear words are required to give a power, by way of secondary legislation, to override a statutory duty imposed by other primary legislation.
- Absent clear wording or a provision to resolve a conflict between duties, the Court should presume that Parliament would not impose inconsistent or clashing duties.
- A direction given by way of secondary legislation which conflicts with a duty arising from primary legislation will be given a narrow interpretation, unless doing so would lead to an absurd result or give rise to a lacuna in the regulatory framework.
Ofcom is under a duty, pursuant to section 8(4) of the Wireless Telegraphy Act 2006 ("WTA"), to make regulations under section 8(3) WTA exempting the establishment, installation and use of a station or apparatus if Ofcom is satisfied that the conditions prescribed by section 8(5) WTA are satisfied.
In July 2017, Ofcom issued a notice stating its intentions to make regulations under section 8(4) of the WTA exempting commercial multi-user gateway GSM apparatus ("COMUGs") from the individual licensing requirement in section 8(1) WTA. A COMUG is a gateway device which uses SIM cards issued by a mobile network operator. Calls made using these devices from fixed lines to mobiles are treated by the recipient’s network as if they were made by a mobile phone. The use of COMUGs is not permitted in the UK without the grant of a licence by Ofcom.
However, Ofcom is also under a duty, pursuant to section 5(2) of the Communications Act 2003 ("CA"), to carry out its functions in accordance with such general or specific directions as may be given to Ofcom by the Secretary of State. In September 2017, the Minister of State for Security gave a direction to Ofcom under section 5(2) CA not to make the regulations under section 8(4) WTA, on the basis of serious national security and public safety concerns. These concerns were based on the fact that, where COMUGs are used, information identifying the number and location of the caller is not transmitted over COMUGs as they are for direct calls. Instead, only the number and location of the SIM card in the COMUG is transmitted. The Claimant did not dispute these concerns.
The Claimant's application turned on whether section 5(2) of the CA conferred power on the Secretary of State to make a direction which overrides the statutory duty imposed on Ofcom to make exemption regulations imposed by section 8(4) of the WTA.
The Claimant contended that the Minister has no power to direct Ofcom not to comply with its duty under section 8(4) WTA. The Defendant, the Secretary of State for the Home Department, contended that section 5(2) imposes a duty upon Ofcom to act in accordance with directions from the Secretary of State which includes a direction which conditions the carrying out of Ofcom's duty under section 8(4) WTA.
The Court allowed the application for judicial review, holding that the Secretary of State's direction was ultra vires its powers under section 5(2) of the CA. There were two central elements to the Court's reasoning.
First, the Court held that the starting point in resolving the conflicting duties is that a restrictive approach to construction is to be adopted and clear words are required to give a power, by way of secondary legislation, to override a statutory duty imposed by other primary legislation. Absent clear wording, or a provision to resolve a conflict between duties, the Court should presume that Parliament would not impose inconsistent duties or clashing duties.
Secondly, the Court held that, as a matter of statutory construction, the power to make directions to Ofcom to carry out its functions in s 5(2) of the CA did not extend to directions to Ofcom "not to carry out a duty".
The Claimant's interpretation of section 5(2) was not absurd and would not leave a lacuna in which the Secretary of State is unable to safeguard national security and public safety issues. There were other ways for the Secretary of State to safeguard these matters. One such way was to amend section 8(5) of the WTA to expand the conditions required to be met for a licence not to be needed.
The Court observed that, in limited circumstances, context may require that effect be given to the direction made by way of secondary legislation, including where that is necessary to avoid an absurd result or a gaping hole in the regulatory framework.
The decision provides useful guidance on the resolution of conflicting duties faced by public bodies. It is a reminder of the importance of parliamentary supremacy in statutory construction. Where a conflict arises between a duty imposed by primary legislation and one arising from another source (such as secondary legislation), parliamentary supremacy will ordinarily require that the duty contained in primary legislation prevails.