In the summer the Digital Economy Bill is set to pass. Here, Fisher German separate the fact from the fiction and explain what it could mean for landowners
June 2017: a significant month that is looming over land and property owners this year. That’s the month the Digital Economy Bill is due to receive Royal Assent and pass into law a few months later – a move that could bring big changes for the land owners and telecoms industry on the whole.
So, with so much uncertainty for all parties, what are the actual facts regarding the bill? How will current arrangements change? And what reaction should we expect from land owners and operators, if any? Fisher German, a leading property consultant and infrastructure service expert, outlines what changes the bill could potentially bring…
What does the Digital Economy Bill aim to do?
Fibre optic broadband and wide spread coverage has long been an aim for the government and it’s an issue where the UK is falling behind other countries. In the Autumn Statement, the chancellor pledged to provide a new £1 billion Infrastructure Fund and work with operators to ensure 98% of the country is covered by Superfast Broadband by 2019.
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.
So why is there negative publicity?
Property and landowners fear that rents paid by telecoms operators will fall significantly as a result of leasing change. They also have reservations over losing control of their land and negotiation powers being taken away. However, 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.
What will this mean for telecoms operators?
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. To increase UK wide coverage and to speed up the process, it is envisaged that operators will be able to share, assign and upgrade their equipment with limited consultation with landowners. However, any changes made by operators can only take place with limited consultation, if there is minimal adverse impact on the landowners retained property.
And what about land and property owners?
Land and property owners will now have more limited means of breaking a tenancy agreement with an operator. Whereas in the past landowners could remove operators purely for the reason of wanting to use the land themselves, this will no longer be a valid reason. Ending a tenancy agreement will now be limited to cases where a valid planning consent has been received, for example a housing or business development. In this case, land and property owners will have to give 18 months’ prior written notice to operators.
What effect does this bill have on current agreements?
The upcoming legislation envisages that those arrangements currently in place and with time to run will continue under the current 1984 Telecommunications Act. Any arrangements made after the Digital Economy Bill is passed will fall under the new legislation.