On Tower UK Limited v AP Wireless II (UK) Limited

When determining the terms of a Code agreement, the tribunal must assess the operator’s present and future business needs and the site provider’s potential loss or damage. An operator need not establish a compelling case for wider sharing rights. The Electronic Communications Code does not confine an agreement to rights listed as Code rights. The amendments made by the Product Security and Telecommunications Infrastructure Act 2022 did not make wider rights to share the site, contractual rights or customer equipment unnecessary or impermissible. A site provider’s entitlement to consideration is not itself loss or damage. A Code agreement cannot properly require an operator not to object to planning applications, since making such an objection is not the exercise of a Code right.

On Tower UK Limited appealed against the First-tier Tribunal’s determination of the terms of replacement leases for 12 telecommunications sites owned or managed by AP Wireless II (UK) Limited. The dispute concerned rights to share electronic communications apparatus, the sites and the rights granted by the leases with customers who were not already occupying the sites. The respondent also sought permission to cross-appeal concerning wayleaves, conduits and objections to planning applications.

The principal issues were the correct application of the approach identified in On Tower UK Limited v JH and FW Green Limited, the effect of the 2022 amendments to the Code, and whether the disputed terms minimised loss and damage to the site provider.

1. Appeal allowed. The FTT’s decision was set aside and the sharing clause was ordered in the form sought by the appellant, permitting sharing of the electronic communications apparatus, the site and the lease rights with both existing and future customers.
2. The approach in On Tower UK Limited v JH and FW Green Limited required the tribunal to consider the term sought and the operator’s business need, then the site provider’s concerns and any necessary qualification to minimise loss or damage. The operator had to provide evidence of need, but did not have to establish compelling or exceptional circumstances. The evidence of ordinary customer requirements, including access, cabinets, cables and associated works, was sufficient.
3. The decision in Compton Beauchamp did not alter that approach. Future business needs could properly be considered when settling the agreement, even though an operator might later seek further Code rights.
4. The FTT had misconstrued the effect of the 2022 amendments. Paragraph 3 now identified additional sharing-related matters as Code rights, but did not make all such rights terms of every Code agreement. Nor did it prohibit agreements from conferring rights which were not Code rights. The amendments did not prevent an infrastructure provider from sharing the site or contractual rights, or from allowing customers to install their own equipment.
5. The respondent produced no evidence of loss or damage caused by the wider sharing rights. A possible entitlement to additional consideration was not loss or damage, and the respondent’s commercial objection could not justify restricting the rights.
6. Permission to cross-appeal on wayleaves and conduits was refused. The clauses reasonably reflected the respondent’s position as an intermediate landlord and protected its interests through approval and costs provisions. Permission to cross-appeal concerning objections to planning applications was also refused. Such objections were not an exercise of Code rights and the FTT’s reference to whether the term touched and concerned those rights did not introduce a new legal test.

• First-tier Tribunal (Property Chamber): determined the terms of replacement leases for 12 sites and restricted sharing with customers not already in occupation.
• Upper Tribunal (Lands Chamber): appeal allowed; the FTT decision was set aside and the sharing clause was varied. Permission to cross-appeal was refused.