by Eifion Bibby of Davis Meade Property Consultants
farMErS and landowners negotiating terms with telecoms companies looking to renew sites for masts or apparatus are advised to seek professional guidance before accepting any offers as a recent tribunal has raised several issues over the new Electronic Communications Code.
The new Electronic Communications Code which came into force in December 2017 contained wide- ranging reforms in favour of operators, with previous enticing rentals being replaced in some cases by derisory offers.
The tribunal case CTIL v Compton Beauchamp Estates Ltd said ‘the evidence presented in future references involving rural property will focus more closely on specific transactions in relevant comparable situations’.
We believe that everyone operating in this sector, including landowners, telecoms firms, land agents and valuers will be advised to be mindful of this guidance.
The government has been promoting the need for more cost effective telecom sites to boost coverage but since the Code was introduced we have seen extreme examples. for instance, one client of mine who previously had been offered £4,650 per annum to host a telecom mast was offered a one-off payment of £32 for 10 years.
In the tribunal case mentioned, CTIL (Cornerstone Telecommunications Infrastructure Limited) proposed a single payment of £26 for the rights sought, based on a vacant possession land value of £10,000.
as the tribunal observed this did not take into consideration the consequences for a landowner having to give someone full access over their land.
The tribunal found force in evidence that many rural landowners have well founded reservations about allowing an operator to have relatively unrestricted access over their land.
reference was made to “evidence of difficulties which had been experienced in practice owing to breaches of bio-security, operators’ vehicles becoming stranded, or interference with sporting rights”; and “risk factors of that sort might weigh in the hypothetical parties’ minds when negotiating consideration”.
“We are not persuaded that the tiny sums suggested…take into account the understandable reluctance of rural landowners to lose control of their land to the extent that entry into an agreement for Code rights is likely to entail“, the tribunal noted.
Comparable rental evidence for alterative agricultural land use agreements will no doubt be useful in supporting valuation methodology to establish, by means of market transactions, what may make a landowner a willing small site provider.