The new Digital Economy Bill is on the way

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News article

The new Digital Economy Bill is on the way

February 2017

Digital Economy Bill

With the Digital Economy Bill forecast to receive Royal Assent in June of 2017, many land and property owners with leases to telecoms operators will be asking how this act might affect firstly the income derived from their leases and secondly what the telecom operators will be able to do under this new legislation. 

Despite the negative publicity previously given to this proposed legislation by those suggesting that rents paid for telecoms leases will fall significantly and in some cases as low as approximately £500 per annum, the reality is that any arrangement between landowner and telecoms operator will be a ‘consensual arrangement’ and only in extreme cases where the parties cannot agree will the matter be fast tracked to a tribunal for determination. 

The aim of this new legislation is to incentivise the operators to provide wider and higher quality network coverage across the UK and to get both broadband and telecoms coverage to those areas where previously operators have not invested. 

It is likely that rents paid for leases will soften when the methodology of valuing these leases changes. It is proposed that leases are valued based on a ‘no scheme approach’ and ignoring the fact that a telecom operator is in occupation of the land. It is envisaged that operators will be able to share, assign and upgrade their equipment with limited consultation with landowners.  This will bring about a natural loss of control over their land, but importantly only where there is minimal adverse impact on the landowners retained property. 

A land and property owner will have limited means of removing an operator and breaking a tenancy arrangement and specifically will not it is envisaged be able to remove an operator purely for the reason of the landowner’s own use of the land. Reasons for ending a tenancy arrangement will be limited to those cases whereby a valid planning consent has been received, for example a development and where the operator will be required to be given 18 months’ prior written notice. 

The proposed legislation envisages that those lease arrangements currently in place and with time still to run will it is proposed continue under the current legislation known as the 1984 Telecommunications Act. Those agreements coming into place after royal assent is given to the Digital Economy Bill will fall under the new legislation. 

Fisher German have been advising and consulting with The Department for Culture, Media & Sport (DCMS) regards this proposed legislation for several years and are best placed to provide land and property owners with expert advice based on sound knowledge of both existing and proposed legislation and how best to protect the interests of our many clients. 

For an informal conversation about how we can help you in these fast-changing times, please contact Chris Hicks on 01858 410202 or email here.

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