In the telecoms world, two appeal decisions have recently been handed down.
The first concerns the age-old lease / licence distinction, but this time in the context of a Code Agreement. We reported on the background facts and decision at first instance here: Lease v Licence – applicability to Code Agreements
The question of whether the right decision was made by Mr Justice Edwin Johnson has been considered by the Court of Appeal in AP Wireless II (UK) Ltd v On Tower (UK) Ltd [2025] EWCA Civ 971.
The Court of Appeal had to grapple with whether a 10-year minimum term, which could be terminated after that time "by either party giving to the other not less than 12 months' notice in writing to expire at any time on or after the expiry of the Minimum Term" meant that the agreement was a lease or a licence.
The Court of Appeal confirmed Mr Justice Edwin Johnson's decision at first instance, deciding that a 10 year "minimum term" could not amount to a lease, as the length of the term was uncertain at the outset.
This distinction was important because a lease would need to be renewed under the Landlord and Tenant Act 1954 (which is more favourable to the Site Provider) whereas a licence would be caught by the Code (and is more favourable to the Operator).
The Court of Appeal therefore confirmed the agreement was a licence and the Code would therefore apply.
The second case, On Tower UK Limited v AP Wireless II (UK) Limited UKUT 280 (LC), concerns sharing rights under the Code and was heard by the Upper Tribunal.
The amendments to the Code introduced by the Product Security and Telecommunications Infrastructure Act 2022 makes the right for operators to share a code right. In other words, operators have a statutory right to share with other operators.
Initially, the First Tier Tribunal considered the extent of that right to share, and whether it included any restrictions. It held that the Operator could share the site and associated rights with other operators currently on site, but that any new operators not yet on site would only be able to share the infrastructure (i.e. not the site or the associated rights).
The Upper Tribunal was asked to consider that decision and whether the First Tier Tribunal had wrongly interpreted the impact of the Product Security and Telecommunications Infrastructure Act 2022.
In doing so, it held that the First Tier Tribunal's decision on sharing was wrong, as it imposed restrictions on the right to share apparatus. Although the focus of the case was on sharing, permission to appeal was refused by the Upper Tribunal meaning that there would be no further opportunity for challenge.
This decision clarifies the scope and extent of the changes which were introduced by the Product Security and Telecommunications Infrastructure Act 2022 and settles questions around whether the right to share can be restricted – it cannot.
These decisions are two more examples of the ever-evolving law in the telecoms sphere and reinforce the scrutiny that will be placed on the meaning, and effect, of contractual and/or statutory provisions on questions such as the status of an agreement and the extent of parties' rights.
