Event video produced by Alex Pirnak
Jon Fell kicked things off with his usual Chairman's introduction, noting the wide range of speakers, the spectacularly packed agenda and, most importantly, the bonfire night themed refreshments to follow! Jon discussed some of the current developments in 5G, the continuing Huawei controversy, the new shared rural network and the acquisitions of KCOM and Arqiva's telecoms divisions. The topics and speakers at the event included:
- an investor's perspective on telecoms market trends (a panel made up of Greg Leyshon and Mike Freer, Osborne Clarke; Chris Godsmark, Oakley Advisory; and Paul Bradford, Southern Communications);
- a review and update on the UK's Electronic Communications Code and the Communications (Access to Infrastructure) Regulations (Emily Van Schalkwyk and Leona Briggs, Osborne Clarke);
- an overview of foreign investment controls and other regulatory barriers on telecoms funding (Marc Shrimpling, Osborne Clarke);
- UK Regulatory update: Ofcom's focus on consumer issues and what is coming up in advance of the European Electronic Communications Code (Hannah Drew, Osborne Clarke); and
- issues surrounding the future of telecoms and the emergence of new technologies (a panel made up of Eleanor Williams and Catherine Hammon, Osborne Clarke; Federico Boccardi, Ofcom; Prash Mehta, BT; and Tim Stranack, Community Fibre).
An investor's perspective on telecommunications market trends
The first panel session was led by Mike Freer and consisted of experts on the investment trends in the telecoms sector. Chris Godsmark provided valuable insight into some of the current investment opportunities, with Greg Leyshon considering the future of the market in the context of the UK's impending withdrawal from the EU and forthcoming general elections. Paul Bradford gave his thoughts on what makes a successful investor in the sector, noting the importance of being selective when choosing management teams for a MBO and then maintaining a close relationship with those teams throughout the process. All three speakers concurred that, for an investor making decisions in this uncertain and febrile economic climate, it is more important than ever to know when to 'walk away' from a deal.
A review and update on the UK's Electronic Communications Code (the "Code") and the Communications (Access to Infrastructure) Regulations
Next, Emily Van Schalkwyk walked us through the Code, first providing useful background and then in-depth analysis of the most significant tribunal decisions relating to the Code in the 2 years since its inception. One such decision was the landmark EE and H3G v London Borough of Islington case (February 2019), which determined the following points:
- a 6 month window for determination of paragraph 20 of the Code is strictly enforced with costs penalties for any party who frustrates it;
- the appropriate test for consideration under paragraph 24 is to adopt a "no network" assumption and disregard any additional consideration payable as a result of the use as a telecoms site. This may lead to nominal consideration being ordered; and
- compensation is only payable where the site provider has sustained loss and damage. Compensation can be awarded simultaneously with the grant of Code rights or later if loss/damage occurs at a later date.
Leona Briggs then provided an insight into the Communications (Access to Infrastructure) Regulations 2016, noting the lack of obvious use of these regulations over the last 12 months (as in previous years) and the practical reasons behind this.
An overview of foreign investment controls and other regulatory barriers on telecoms funding
Marc Shrimpling then focussed on the regulatory environment for foreign investment in the UK telecoms sector. Marc noted that the UK is clearly still very much 'open for business', with very favourable regulatory conditions for foreign investors. He stressed, however, that such benign conditions may be set to change, highlighting the Government's recent commitment, outlined in the Queen's speech, to protect "national security interests", which expressly includes "infrastructure of national importance" and therefore clearly encompasses the telecoms sector. Marc warned us to watch this space very closely.
UK Regulatory update: Ofcom's focus on consumer issues and what is coming up in advance of the European Electronic Communications Code
Hannah Drew provided an update on changes to the regulations underpinning the telecoms sector, focussing particularly on (1) the Department for Digital, Culture, Media & Sport's proposals for a new telecoms consumer advocate; (2) Ofcom's proposals in relation to split linked contracts; (3) the European Commission's proposals for a template contract summary; and (4) the status of the European Electronic Communications Code ("EECC") - noting that the implementation deadline is now just 13 months away. Hannah also provided the (rather encouraging!) opinion that, despite the uncertainty over Brexit, the Government's fairly unambiguous stance on the implementation of the EECC means there is still some certainty around the future telecoms regulatory framework.
Issues surrounding the future of telecoms and the emergence of new technologies
Finally, Eleanor Williams led a panel discussion on the future of telecoms and the emergence of new technologies, with an emphasis on the practical challenges the UK faces with the roll-out of 5G, fibre and other technologies. The panel members agreed that concerns over security are having an impact on the deployment of 5G technology and that, while we wait for its roll-out, the importance of widespread fibre coverage should not be underestimated. The panel also discussed countries the UK can look to for examples of recent telecoms innovation – with South Korea, Japan and Spain all being mentioned.
The review was punctuated with interactive Slido polls and a rolling digital Q&A which allowed audience members to fire questions at our speakers throughout the afternoon. This year's bonfire night themed telecoms review would not have been complete without toffee apples, cocktail-making and dry-ice infused meringues!