Mercury Personal Communications Ltd & Anor, R (on the application of) v Secretary Of State For Trade & Industry

Subordinate legislation made under one Act cannot be used to defeat specific statutory rights conferred by another Act. A power to prescribe requirements for bidding for a new licence does not, without express words, authorise the Secretary of State to remove or compel variation of rights under an existing licence.

Nor may the power be used indirectly to secure consent by threatening exclusion from the bidding process. Where primary legislation provides that existing licence conditions may be modified only by consent or following a specified independent regulatory procedure, that protection cannot be undermined by conditional access to a new licensing opportunity.

The applicants were existing mobile telecommunications operators holding licences under the Telecommunications Act 1984. The Secretary of State proposed to make regulations under section 3 of the Wireless Telegraphy Act 1998 requiring existing operators to accept a roaming condition in their 1984 Act licences as a precondition of bidding for third-generation mobile telecommunications licences.

The challenge concerned whether that proposal was within the statutory power to regulate bidding and whether it conflicted with the 1984 Act regime governing modification of existing licences.

1. The application for judicial review succeeded. A declaration was made that the proposal to require existing operators to accept amendments to their 1984 Act licences as a condition of bidding was unlawful.
2. The principle stated in R v Secretary of State for Social Security, ex parte Joint Council for the Welfare of Immigrants [1997] 1 WLR 275 applied: subsidiary legislation must not conflict with specific statutory rights conferred by primary legislation.
3. Section 3(3)(b) of the Wireless Telegraphy Act 1998 was confined to requirements restricting one person from holding two or more wireless telegraphy licences. It did not authorise removal or modification of existing rights under a different licensing regime.
4. Section 3(3)(f) did not confer a wider power than section 3(1). Neither provision authorised regulations which conflicted with existing statutory rights.
5. The Telecommunications Act 1984 established a statutory scheme under which modification of an existing licence required the holder’s consent or, in the relevant circumstances, reference to and a report from the Competition Commission under sections 12 to 15. That scheme did not permit compulsion or a sanction designed to secure consent.
6. Making the opportunity to bid conditional on accepting a modification would indirectly achieve what could not be done directly. It would deprive an existing licence holder of the opportunity to bid unless the holder surrendered the statutory protection against modification. The proposal therefore eroded and conflicted with the 1984 Act scheme.

The judgment records that permission to appeal was granted. No subsequent appellate decision is stated in the supplied text.