Smooth operator? Arqiva Services Ltd v AP Wireless II (UK) Ltd  UKUT 0195 (LC) and its implications for an operator in occupation of a site without Code rights
On 19 June 2020, the Upper Tribunal handed down judgment in what was fittingly the Land Chamber's first witness trial conducted by the means of electronic communication. This decision confirmed that an operator in occupation of a site without Code rights cannot resort to paragraph 20 to bring itself within the scope of the New Code in order to obtain Code rights.
The new Electronic Communications Code is set out in Schedule 3A of the Communications Act 2003 ("the New Code").
Part 4 of the New Code contains paragraphs 20 and 27, which were described in The University of London v Cornerstone Telecommunications Infrastructure Limited  EWCA Civ 2075 as being "inextricably linked".
Paragraph 20 enables an agreement to be imposed on the parties by order of the Tribunal by which a person confers, or is bound by, Code rights. The starting point requires the operator to serve notice on the relevant person and if agreement cannot be reached consensually to provide for the Code rights sought, the matter can be referred to the Tribunal to impose an agreement.
Paragraph 27 enables the Tribunal to impose temporary Code rights between the parties where an operator has existing apparatus on site and another party has a right to require its removal. An agreement may be imposed by the Tribunal if reasonably necessary to ensure the existing network is maintained and apparatus adjusted or repaired whilst proceedings under paragraph 20 or 40 (the latter dealing with a landowner's or occupier's ability to remove apparatus on site) are determined.
An operator is required to serve notice under paragraph 20 requiring the imposition of an agreement in order for an application to be made under paragraph 27.
AP Wireless II (UK) Ltd is freehold owner of land at Queens Oak Farm, Towcester ("the land").
The claimant, Arqiva Services Ltd ("the operator"), had been occupying the land pursuant to rights acquired under the New Code's statutory predecessor in Schedule 2 of the Telecommunications Act 1984 ("the Old Code") until October 2016 when the term of its lease, which was contracted out of the security of tenure provisions in Part II of the Landlord and Tenant Act 1954, expired. The operator continued occupying the land and paying rent thereafter and no agreement was subsequently reached on the parties entering into a new lease.
Following the introduction of the New Code on 28 December 2017, the operator wished to acquire Code rights and subsequently served notice on the landowner seeking orders under paragraphs 20 and 27 of the New Code.
The issue to be determined by the Tribunal was whether the operator benefitted from Code rights and, if not, how it might go about acquiring them.
At issue were:
Status of occupation
- whether the operator held over, after expiry of its lease in October 2016, as a tenant at will, a periodic tenant or a contractual licensee;
- whether the operator occupied the land pursuant to a subsisting agreement;
- whether the operator's status changed as a result of correspondence passing between the parties' representatives; and
- if there was no subsisting agreement and the operator had not otherwise acquired Code rights by agreement, did the Tribunal otherwise have jurisdiction to impose an agreement on the parties under paragraph 20 of the New Code.
The Upper Tribunal's decision
On the first three questions, the Tribunal concluded the operator occupied the land as a tenant at will following expiry of its lease in October 2016, without a subsisting agreement for the purpose of the transitional provisions and that nothing else had occurred to alter this position, including correspondence which had passed between the parties' respective representatives in which it was apparently agreed that the operator was to occupy as a contractual licensee and that that agreement conferred Code rights on the operator. The operator therefore remained in occupation of the land without rights under the Old Code after October 2016 and remained there still without Code rights.
On the final question, the focus was how, if at all, the operator who was occupying the land and who had electronic communications apparatus on such land without Code rights could proceed to obtain Code rights.
The Tribunal held that it was bound to follow the Court of Appeal's view of the structure of the New Code in Cornerstone Telecommunications Infrastructure Limited v Compton Beauchamp Estates Limited  EWCA Civ 1755, deciding that an operator in situ without Code rights, providing a network or infrastructure so that other operators can do so, is not able to resort to paragraph 20 of the New Code, irrespective of whether an application is also made under paragraph 27 of the New Code.
In applying the Court of Appeal's above decision, the Tribunal concluded that it did not have jurisdiction to impose an agreement under paragraph 20 of the New Code conferring Code rights.
This is an important decision which adds clarity for operators and site providers alike, albeit with potentially unwelcome implications for an operator already in situ of a site which it historically occupied pursuant to rights acquired under the Old Code where no Code rights have subsequently been obtained following the introduction of the New Code.
Whilst the Tribunal's decision offered up some possible alternative avenues for the operator, such as to "find a friendly operator, confer Code rights upon it, and then apply for the landowner to be bound" or alternatively to move off the land and start over from scratch (which the Tribunal appreciated would result in considerable cost and wasted effort), it confirmed that the particular avenue is closed off for an operator in these circumstances to use paragraph 27 of the New Code to seek to bring themselves within the scope of paragraph 20 of the New Code in order to obtain Code rights where it otherwise has none.
The Tribunal has contemplated the prospect of this decision being subject to appeal, and so operators and site providers should watch this space. Until then, an operator who finds itself in similar circumstances will remain "a square peg, without Code rights, unable to fit itself into the round hole of paragraph 20".
If you have any telecoms-related queries, please do not hesitate to contact a member of our specialist telecoms team.