Wednesday , 27 May 2020
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Impact of new telecoms code still to be tested

After a fairly significant consultation exercise the Government rolled out its new telecom strategy for the country with the primary object of ensuring greater coverage throughout all parts the country and covering areas currently underserved.

To achieve this telecoms operators need encouragement to spend on potentially non profitable sites and in order to promote this, the new code is likely to prompt a substantial reduction on rental levels for those sites which will now be covered by the new code. Landowners’ interests have been postponed for what is seen as the greater public good. The upside is more sites may now be developed as there are many areas with no signal. Site access will also be easier for operators.

When it comes to the expiry of an existing lease the manner in which this will be treated depends on what type of lease has expired. This could be a lease protected by the Landlord and Tenant Act 1954.

This gives protection to a tenant of business premises, allowing tenants to hold over in occupation at the end of the lease with rights for renewal and, if the parties cannot agree, the court can decide the terms of the new lease. Deciding which laws apply will not always be straightforward as, for example, some older sites may not even have formal documentation.

However if the 1954 lease was “contracted out” of the 1954 Act succession provisions by the landlord and the tenant at the time of the grant of the old lease then the termination will be dealt with in accordance with the new code on more favourable terms for the operator.

Another main purpose behind the new code was to remove what was seen as a system where the operator might have two bites of the cherry under both the old code and the 1954 Act regime so the possible duplication of time and costs should be avoided.

In practice there have been very few new leases or renewals since the new code came into force and little evidence from the marketplace or the court on the outcome of negotiations. Operators and landowners are still to see how the market settles down.

If landowners have any queries on an existing or new telecommunications site they should consult a solicitor or land agent with the specialist knowledge needed to give advice on this tricky subject.

Steven Corfield is a partner and agricultural specialist at Shropshire law firm, FBC Manby Bowdler LLP.

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