A TRIBUNAL result has set a precedent that strengthens the position of landowners and tenants renegotiating terms for pre-existing telecoms mast sites on their land.

Since the introduction of the new Electronic Communications Code in late 2017, telecommunications operators have used the new rules to force down annual rents by as much as 90%, to the frustration for many site holders.

However, a recent decision in an Upper Tribunal case – CTIL v Ashloch and AP Wireless (2019) – found that the operator, which had served a lease renewal notice to the landowner under paragraph 20 of the new Code, had been incorrectly using code powers where they did not actually apply.

The crucial fact in this case is that the mast site had been let to the operator by the landowner prior to the introduction of the new Electronic Communications Code in 2017 – and the case clarified that the lease is governed under the Landlord and Tenant Act 1954, rather than the new code. The notice procedure under the new code is therefore not relevant and the legal process for tenancy renewals under the Landlord and Tenant Act 1954 must be followed instead – rendering such renewal notices as completely invalid.

Chartered Surveyor for H and H Land and Estates, North East and Yorkshire, Robert Jauneika, explained the impact this decision will have on the industry: “This is good news for many mast site landlords, as the lease renewal terms under the Landlord and Tenant Act 1954 (including the calculation of rental value) is more favourable to the landlord than the valuation of the same under the new code.

“Under the Landlord and Tenant Act, the rent calculation relates to the open market value of the lease, whereas the new code states that the rent is to be based upon consideration, with operators typically arguing that the consideration for agreements under the new code should be based on surrounding land use value, which leads to very low rental levels, especially for those sites in agricultural surroundings," he explained.

“If you have an existing telecoms mast site and the lease is approaching the termination date, you would be well advised to seek professional advice in relation to the negotiation of the lease renewal and to ensure that the value of your site is maximised," Mr Jauneika urged. “The decision reached by the Tribunal in this case has fundamentally changed the negotiating position of many landlords and tenants of existing mast sites.”