1 Overview

1.1 Please describe the: (a) telecoms, including internet; and (b) audio-visual media distribution sectors in your jurisdiction, in particular by reference to each sector's: (i) annual revenue; and (ii) 3–5 most significant market participants.

The UK has open and competitive telecoms, internet and broadcasting markets. The Office of Communications' ("Ofcom") '2018 Communications Market Report' reported a total UK communications revenue of £54.7bn in 2017, of which £35.6bn was attributable to telecoms (including internet) and £13.6bn to TV with the balance accounted for by radio and post.

Key participants in the UK market include:

  • the ex-incumbent BT plc, which in addition to its position in the fixed and broadband markets, competes in the mobile market through its mobile subsidiary EE and has entered the pay-TV market;
  • national cable TV infrastructure operator Virgin Media, which offers mobile telephony through an MVNO in addition to bundled cable TV, broadband and fixed telephony services;
  • satellite broadcaster Sky, which now also provides broadband, fixed and mobile services;
  • 'infrastructure-light' bundled service provider Talk Talk;
  • 'mainly mobile' (but with bundled offers) Vodafone, O2 and Three mobile infrastructure operators;
  • the licence-fee funded BBC which competes with state-owned but ad-funded Channel 4 and privately-owned ITV and Channel 5 as public service broadcasters, as well as a wider variety of other broadcast channels; and
  • over-the-top providers of both content (such as Netflix and Amazon Prime) and services (such as WhatsApp) as well as internet companies including Google, Apple and Facebook.

1.2 List the most important legislation which applies to the: (a) telecoms, including internet; and (b) audio-visual media distribution sectors in your jurisdiction.

(a) Telecoms and internet

  • Communications Act 2003 ("CA 2003").
  • Wireless Telegraphy Act 2006.
  • Electronic Communications and Wireless Telegraphy Regulations 2011.
  • Digital Economy Act 2017 ("DEA 2017").
  • Regulation of Investigatory Powers Act 2000 ("RIPA").
  • Investigatory Powers Act 2016 ("IPA").
  • Telecommunications (Lawful Business Practices (Interception of Communications)) Regulations 2000.
  • General Data Protection Regulation.
  • Data Protection Act 2018.
  • Privacy and Electronic Communications (EC Directive) Regulations 2003 as amended in 2011.
  • Radio Equipment and Telecommunications Terminal Equipment Regulations 2000.
  • Network and Information Systems Regulations 2018.

(b) Audio-visual media distribution

  • Broadcasting Act 1990.
  • Broadcasting Act 1996.
  • CA 2003.
  • Wireless Telegraphy Act 2006.
  • Digital Economy Act 2010.
  • Digital Economy Act 2017.
  • The Audiovisual Media Services Directive 2010/13/EU.

1.3 List the government ministries, regulators, other agencies and major industry self-regulatory bodies which have a role in the regulation of the: (a) telecoms, including internet; and (b) audio-visual media distribution sectors in your jurisdiction.

(a) Telecoms and internet

  • The UK Government Department for Culture, Media and Sport.
  • Ofcom.
  • The Competition and Markets Authority ("CMA").
  • The Competition Appeal Tribunal ("CAT").
  • Phone-paid Services Authority.
  • The Information Commissioner.
  • Nominet.

(b) Audio-visual media distribution

  • The UK Government Department for Culture, Media and Sport.
  • Ofcom.
  • The Advertising Standards Authority (self-regulatory body for advertising).

1.4 In relation to the: (a) telecoms, including internet; and (b) audio-visual media distribution sectors: (i) have they been liberalised?; and (ii) are they open to foreign investment?

(a) Telecoms and internet

(i) Yes.

(ii) Yes.

(b) Audio-visual media distribution

(i) Yes.

(ii) Yes.

2 Telecoms


2.1 Is your jurisdiction a member of the World Trade Organisation? Has your jurisdiction made commitments under the GATS regarding telecommunications and has your jurisdiction adopted and implemented the telecoms reference paper?

The UK has been a WTO member since 1 January 1995. It made commitments under the GATS/GATT in relation to the telecommunications market and has adopted the WTO basic telecommunications agreement. The UK has also adopted and implemented the telecoms reference paper, which it jointly sponsored alongside the US in the Uruguay round of WTO negotiations.

2.2 How is the provision of telecoms (or electronic communications) networks and services regulated?

The provision of electronic communications networks and services and the use of radio spectrum are regulated by Ofcom.

In particular, Ofcom is responsible for:

  • setting and enforcing the General Conditions of Entitlement ("General Conditions");
  • undertaking market reviews, setting and enforcing SMP conditions (e.g. access and interconnection);
  • setting universal service obligations in accordance with the Secretary of State's specification of services;
  • setting consumer protection requirements and dealing with complaints;
  • managing numbering;
  • issuing and enforcing spectrum licences;
  • regulating conditional access and electronic programme guides; and
  • resolving disputes.

The day-to-day obligations imposed on electronic communications network and service providers ("Communications Providers") are set out in the General Conditions. These were substantially revised on 1 October 2018. Additional obligations apply to operators with significant market power ("SMP"), and designated universal service providers.

Ofcom also has concurrent jurisdiction with the CMA to enforce competition law in respect of electronic communications matters.

The Phone-paid Services Authority regulates the content and marketing of premium rate services, including directory enquiry services.

The Information Commissioner is responsible for data protection and freedom of information matters.

2.3 Who are the regulatory and competition law authorities in your jurisdiction? How are their roles differentiated? Are they independent from the government?

Ofcom is the UK's national regulatory authority for communications, and regulates telecoms, the use of radio spectrum, the TV and radio sectors and post. Ofcom is independent from the Government.

The CMA is the UK's consumer and competition authority (though Ofcom also has concurrent powers to apply and enforce competition law in the telecoms sector). The CMA is a non-ministerial government department independent from the Government.

Rules are in place to co-ordinate the regulators' exercise of concurrent competition law jurisdiction under the Competition Act 1998 and the Competition Act 1998 (Concurrency Regulations) 2014. These rules are primarily designed to ensure that only one competent authority may launch a formal Competition Act investigation into the same conduct. Further, information on the operation of concurrency procedures is provided in the CMA's first 'Annual Report on Concurrency', published in April 2015.

Agreements or conduct relating to the sector covered by a concurrent regulator will generally be dealt with by that regulator.

2.4 Are decisions of the national regulatory authority able to be appealed? If so, to which court or body, and on what basis?

Yes, Ofcom's decisions can be appealed.

Non-price control matters are appealed to the CAT, and price control matters to the CMA.

Since 31 July 2017, appeals are reviewed on a 'judicial review' basis rather than an 'on their merits' basis. This change has made it significantly harder to appeal Ofcom's decisions.

Licences and Authorisations

2.5 What types of general and individual authorisations are used in your jurisdiction?

No licence or other authorisation is required to install or operate electronic communications networks or services unless the use of radio frequency spectrum is involved or the communications require powers to access public or private land.

In order to use radio frequency spectrum, a Communications Provider must have a licence under the WTA, although Ofcom also has the power to authorise spectrum use on a class licence or a licence-exempt basis.

2.6 Please summarise the main requirements of your jurisdiction's general authorisation.

Ofcom significantly revised the UK's General Conditions of entitlement with the changes taking effect on 1 October 2018. The new General Conditions are split into three sections, summarised below:

Part A – Network functioning conditions

  • General network access and interconnection obligations.
  • Standards and specifications.
  • Availability of Services and access to emergency services.
  • Emergency planning.
  • "Must Carry" obligations.

Part B – Numbering and technical conditions

  • Allocation, adoption and use of telephone numbers.
  • Directory information.
  • Number portability.
  • Access to numbers and services.

Part C – Consumer protection conditions

  • Contract requirements.
  • Information publication and transparency requirements.
  • Billing requirements.
  • Complaints handling and dispute resolution.
  • Measures to meet the needs of vulnerable consumers and end-users with disabilities.
  • Calling line identification facilities.
  • Switching.
  • Sales and marketing of mobile communications.

2.7 In relation to individual authorisations, please identify their subject matter, duration and ability to be transferred or traded. Are there restrictions on the change of control of the licensee?

For many activities, individual licences are not required, so the question does not arise.

Whilst there are no hard and fast rules concerning the duration of spectrum licences, typically they are granted for an initial fixed period, with an option to renew on payment of additional licence fees. Where applicable regulations have been passed, the licences may be traded or transferred.

Public and Private Works

2.8 Are there specific legal or administrative provisions dealing with access and/or securing or enforcing rights to public and private land in order to install telecommunications infrastructure?

The DEA 2017 significantly updated and improved the UK's regime enabling access to land – so-called "Code Powers" – from December 2017. The new scheme enables providers of electronic communications networks to construct infrastructure on public land (streets), and to take rights over private land, either with the agreement of the land owner or by applying to court.

In addition, there are also certain exceptions to planning legislation available to Communications Providers. For example, under planning regulations (e.g. the Town & Country Planning (General Permitted Development) (England) Order 2015, as amended), land may be developed by Communications Providers to whom the Code applies for the purposes of their networks, in particular the installation, alteration or replacement of apparatus.

Access and Interconnection

2.9 How is wholesale interconnection and access mandated? How are wholesale interconnection or access disputes resolved?

General Condition A1 requires all Communications Providers to negotiate interconnection on request.

Various SMP conditions also require various UK Communications Providers (most notably BT and, for call termination, mobile operators) to provide various interconnection and/or access services and to publish the reference terms and conditions.

Disputes between different Communications Providers concerning network access and the relevant terms and conditions for such access may be referred to Ofcom for resolution. Ofcom must, other than in exceptional circumstances, make a binding determination resolving the dispute within four months of the date of its decision to handle the dispute, although this timescale is often missed in practice.

2.10 Which operators are required to publish their standard interconnection contracts and/or prices?

Following market reviews, publication obligations have been imposed on Communications Providers including BT for various products, and on Everything Everywhere, T-Mobile and Vodafone for voice call termination.

2.11 Looking at fixed, mobile and other services, are charges for interconnection (e.g. switched services) and/or network access (e.g. wholesale leased lines) subject to price or cost regulation and, if so, how?

Interconnection and network access is subject to price regulation in a number of different markets. In general, where wholesale pricing obligations have been imposed, prices are required to be based on forward-looking long-run incremental costs plus a mark-up for common costs including return on capital employed. In certain markets RPI-X price caps have been imposed. A pure LRIC basis is used for setting mobile termination rates.

2.12 Are any operators subject to: (a) accounting separation; (b) functional separation; and/or (c) legal separation?

(a) Both BT and KCom are subject to accounting separation requirements pursuant to their SMP obligations on certain markets, including cost accounting rules and accounting separation obligations.

(b) In 2005, BT gave Undertakings to Ofcom in order to avoid a reference to the former Competition Commission under the Enterprise Act 2002. Among these obligations was an Undertaking to set up Openreach as a functionally separate business unit of BT to operate BT's local access network.

(c) Following a review by Ofcom, in 2017 BT offered new Undertakings to Ofcom which will replace the 2005 Undertakings when implemented. These include establishing Openreach Limited as a wholly-owned, but legally separate, subsidiary of BT plc, with independent responsibility for the strategy, management and operation of Openreach and the employment of 32,000 employees; Openreach to have a majority independent board; and Openreach having duties to treat all customers equally. The Undertakings also require Openreach control over assets and customer data confidentiality walls.

2.13 Describe the regulation applicable to high-speed broadband networks. On what terms are passive infrastructure (ducts and poles), copper networks, cable TV and/or fibre networks required to be made available? Are there any incentives or 'regulatory holidays'?

BT is the only operator with regulatory obligations to provide access to its high-speed broadband networks, and there are no access obligations imposed on the national cable TV operator Virgin Media, or other fibre network infrastructure operators.

BT is obliged to provide access to its passive infrastructure, copper networks and a "virtual unbundled local access" product on its next generation network.

Some (but not all) of BT's high-speed access products are subject to price regulation.

Price and Consumer Regulation

2.14 Are retail price controls imposed on any operator in relation to fixed, mobile, or other services?

Mobile operators are subject to the EU-level Mobile Roaming Regulation (Regulation 531/2012), which imposes caps on wholesale and retail charges for mobile calls, SMS and data services while roaming between EU Member States.

2.15 Is the provision of electronic communications services to consumers subject to any special rules (such as universal service) and if so, in what principal respects?

Part C of the General Conditions includes a number of consumer protection obligations and requirements which apply over and above general consumer protection law.

In addition, there are Universal Service obligations on BT.


2.16 How are telephone numbers and network identifying codes allocated and by whom?

Telephone numbers and network identifying codes are allocated and managed by Ofcom.

2.17 Are there any special rules which govern the use of telephone numbers?

Communications Providers are required by General Condition B1 (Allocation, adoption and use of telephone numbers) to comply with the National Telephone Numbering Plan. Numbers are allocated for specific uses, e.g. geographic, mobile, etc., and may be granted for a limited period of time.

In addition, the services offered behind particular number ranges may be subject to regulation by the Phone-paid Services Authority, for example, premium rate or 09 numbers, 08 and directory enquiry services and premium rate SMS.

Communications Providers are required to unbundle charges for calls made to non-geographic numbers, such as 0845 or 03 numbers.

2.18 Are there any obligations requiring number portability?

All Communications Providers are required by General Condition B3 (Number portability) to facilitate the porting of numbers, including mobile numbers. This means that numbers must be ported on a customer's request, subject to a reasonableness requirement, and Communications Providers must enter into porting arrangements when requested by another operator. Porting must take place within one business day. The cross-industry porting procedure has been defined in detail.

3 Radio Spectrum

3.1 What authority regulates spectrum use?

Ofcom regulates spectrum use.

3.2 How is the use of radio spectrum authorised in your jurisdiction? What procedures are used to allocate spectrum between candidates – i.e. spectrum auctions, comparative 'beauty parades', etc.?

Spectrum use may be authorised on the basis of individual licences, class licences or licence-exempt use. In general, Ofcom will use auctions to allocate scarce spectrum.

3.3 Can the use of spectrum be made licence-exempt? If so, under what conditions?

Yes, pursuant to the Wireless Telegraphy (Exemption) Regulations 2003, as amended.

3.4 If licence or other authorisation fees are payable for the use of radio frequency spectrum, how are these applied and calculated?

For commercially exploitable wireless telegraphy licences, fees will normally be payable, either pursuant to prices bid at auction or under administrative incentive pricing ("AIP") set under specific regulations according to the type of service involved. AIP seeks to set fees to mimic the market value of the spectrum.

3.5 What happens to spectrum licences if there is a change of control of the licensee?

If the legal entity that has the benefit of the spectrum licence does not change, the change of control would not usually result in a change to the spectrum licence. However, in a certain spectrum (notably that used for mobile services), a competition assessment may be triggered.

3.6 Are spectrum licences able to be assigned, traded or sub-licensed and, if so, on what conditions?

Yes. The regime for controlling the trading and leasing of spectrum licences is set out in the WTA and the Wireless Telegraphy (Spectrum Trading) Regulations 2012 ("Trading Regulations") which, from 13 September 2012, replaced and revoked the earlier trading regulations. Ofcom's consent is no longer needed for most spectrum trades.

The Trading Regulations allow spectrum licence holders in certain classes to transfer all of their licence rights and obligations.

4 Cyber-security, Interception, Encryption and Data Retention

4.1 Describe the legal framework for cybersecurity.

The Computer Misuse Act 1990 specifies various hacking offences and the Official Secrets Act 1989 deals with national security.

Each of the Communications Act 2003, the General Data Protection Regulation, the Data Protection Act 2018 and the Privacy and Electronic Communications (EC Directive) Regulations 2003 (SI 2003/2426) contain obligations on Communications Providers (and others) to take appropriate technical and organisational security measures.

The Network and Information Security Regulations 2018 implement the EU Network and Information Security Direction in the UK and impose obligations on operators of essential services in the digital information sector, including top-level domain name registries, domain name system service providers and internet exchange operators that meet certain thresholds.

4.2 Describe the legal framework (including listing relevant legislation) which governs the ability of the state (police, security services, etc.) to obtain access to private communications.

RIPA and the IPA govern interception of the content of communications and acquisition of data associated with that communication. Both RIPA and the IPA set out the requirements and process for access to private communications by the state and provide an oversight mechanism.

4.3 Summarise the rules which require market participants to maintain call interception (wire-tap) capabilities. Does this cover: (i) traditional telephone calls; (ii) VoIP calls; (iii) emails; and (iv) any other forms of communications?

The Government can require a Communications Provider to maintain intercept capacity by issuing a specified notice, preceded by consultation.

RIPA sections 12–14 and the Regulation of Investigatory Powers (Maintenance of Interception Capability) Order 2002 set out the framework. Traditional telephone calls, VoIP calls, emails and other forms of electronic communication are all within the scope of interception capability.

4.4 How does the state intercept communications for a particular individual?

Under both RIPA and the IPA, a warrant is required to intercept communications.

4.5 Describe the rules governing the use of encryption and the circumstances when encryption keys need to be provided to the state.

Under RIPA, the Government has the power to serve a notice: to require disclosure of protected information in an intelligible form; to require disclosure of the means to access protected information; and to require disclosure of the means of putting protected information into an intelligible form.

Notice to disclose encryption keys may only be served where necessary for: national security; preventing or detecting serious crime; safeguarding the economic wellbeing of the UK; or "effective exercise or proper performance" by a public authority of statutory powers or duties.

Necessity and proportionality tests must be met.

4.6 What data are telecoms or internet infrastructure operators obliged to retain and for how long?

Under the IPA, operators may be required to retain communications data which may be used to identify, or assist in identifying, any of the following:

(a) the sender or recipient of a communication (whether or not a person);

(b) the time or duration of a communication;

(c) the type, method or pattern, or fact, of a communication;

(d) the telecommunications system (or any part of it) from, to or through which, or by means of which, a communication is or may be transmitted; or

(e) the location of any such system, and this expression therefore includes, in particular, internet connection records.

Operators may be required to retain data for a maximum of 12 months.

The law relating to data retention is contentious and subject to ongoing challenges, notably at the ECJ.

5 Distribution of Audio-Visual Media

5.1 How is the distribution of audio-visual media regulated in your jurisdiction?

Broadcasters of linear and non-linear content are regulated differently (see question 5.2 below). The provision of the infrastructure over which content is delivered is regulated under the telecommunications regulation regime described above.

5.2 Is content regulation (including advertising, as well as editorial) different for content broadcast via traditional distribution platforms as opposed to content delivered over the internet or other platforms? Please describe the main differences.

  • Linear content, whether delivered over the internet or via traditional distribution platforms, is regulated under a licensing regime administered by Ofcom.
  • All UK linear TV channels require a licence (see question 5.3 below).
  • Since 2009, pursuant to the AVMS Directive, UK-based non-linear services have been subject to a set of minimum standards overseen by Ofcom in respect of editorial and administrative regulation. Ofcom has designated the Advertising Standards Authority as the co-regulator for advertising content on non-linear services.
  • Non-linear services do not require a licence, but there is a compulsory pre-notification requirement to Ofcom before making such 'on-demand' services available.
  • There is an additional layer of obligations (and benefits) applying to the public service broadcasters ("PSBs") in the UK, which include BBC, ITV, Channel 4, Channel 5 and S4C. The PSBs are under an obligation to make their core channels available to major platforms; however, this does not apply to on-demand services. In addition, there are "Must Carry" obligations on platforms to carry PSB linear channels, which do not apply to on-demand content.
  • Broadcasters of linear content are subject to the Broadcasting Committee on Advertising Practice (BCAP) Code, whereas non-linear content falls under the remit of the General Committee on Advertising Practice (CAP) Code. As a result, non-linear content providers are not subject to certain rules, such as those regarding the watershed.

5.3 Describe the different types of licences for the distribution of audio-visual media and their key obligations.

The BBC operates pursuant to a sui generis Royal Charter.

Aside from the BBC, the key licence types are as follows:

  • DRL – licence in force for public service broadcasters as the successor to the analogue broadcast licence.
  • DPSL – digital programme service licence; for services distributed via UK digital terrestrial television.
  • TLCS licence – for linear services distributed via other platforms for reception by members of the public.
  • DRL licences contain certain public service obligations regarding the types of programming to be broadcast, but beyond these, all licence types contain broadly similar obligations to comply with:

  • Ofcom programming standards (including standards of taste and decency, protection of minors and editorial integrity);
  • advertising standards (including truth and accuracy in advertising, control over the timing and scheduling of advertisements); and
  • minimum requirements for European content and content from independent producers.

For PSB licences, there are limits on the rights which may be acquired under a commissioning arrangement with an independent producer.

5.4 Are licences assignable? If not, what rules apply? Are there restrictions on change of control of the licensee?

Licences are assignable with the prior approval of Ofcom and are subject to the payment of a small fee to Ofcom (currently £1,000). Other than in respect of the public service broadcasting licences, Ofcom will only decline to approve a licence assignment where the assignee would have been ineligible to apply for the licence in the first place or is not a "fit and proper" person to hold a licence.

There are no restrictions on change of control in Ofcom licences, although any company that acquires control of an Ofcom licensee is required to be a "fit and proper" person and to not belong to the category of entities ineligible to hold an Ofcom licence (political and religious bodies, local government authorities and advertising agents and those "connected" with them, as well as those convicted of certain "pirate broadcaster" offences). Notification must be given to Ofcom within 30 days after any change of control takes place.

6 Internet Infrastructure

6.1 How have the courts interpreted and applied any defences (e.g. 'mere conduit' or 'common carrier') available to protect telecommunications operators and/or internet service providers from liability for content carried over their networks?

Under the Electronic Commerce Regulations 2002, provided that a service provider acting as an ISP, network operator or web host complies with the Regulations, it will generally not be liable for any material where it:

  • acts as a mere conduit;
  • caches the material; or
  • hosts the material.

Where a service consists of either transmitting in a communication network of information which has been provided by a recipient of the service (e.g. an ISP transmitting a customer's email) or where the service consists of the providing access to a particular communication network (for example, an ISP), then the service provider will not be liable for damages, any other financial remedy or any criminal sanction if:

  • it did not initiate the transmission;
  • it did not select the receiver of the transmission; and
  • it did not select or modify the information in the transmission.

There is no general obligation on service providers to monitor content, but once a service provider gains "actual knowledge" of any unlawful material or the removal from its original source of any cached material, it must act "expeditiously" to ensure that such material is taken down. This has been construed relatively restrictively, meaning that if a service provider has taken on any editorial role, it cannot rely on this defence.

Section 1 of the Defamation Act 1996 also provides for a defence for a service provider which has published a defamatory statement where it: (a) is not the author, editor or publisher of the material; (b) takes reasonable care in relation to the publication; and (c) does not know or has no reason to believe that what it did caused or contributed to the publication of a defamatory statement. The leading case of Godfrey v Demon Internet established that it is not necessary for an ISP to remove defamatory material instantly on notification, but that this must be done within a reasonable time (in this case a delay of 10 days defeated the defence).

6.2 Are telecommunications operators and/or internet service providers under any obligations (i.e. to provide information, inform customers, disconnect customers) to assist content owners whose rights may be infringed by means of file-sharing or other activities?

Under the voluntary scheme, Creative Content UK, large ISPs have agreed to collaborate with content owners in a process where infringers are notified and warned of their conduct. In addition, ISPs must provide a list of infringers to the relevant content provider.

Injunctions are available from the UK courts to allow content owners to force ISPs to block access to copyright infringing websites or streaming servers.

6.3 Are there any 'net neutrality' requirements? Are telecommunications operators and/or internet service providers able to differentially charge and/or block different types of traffic over their networks?

Subject to general competition law, Communication Providers are able to differentially charge. However, Communications Providers with SMP (including BT) may be subject to undue discrimination rules.

The Connected Continent Regulation (EU) 2015/2120 sets out high-level rules in relation to net neutrality and BEREC has issued guidelines on its application.

6.4 Are telecommunications operators and/or internet service providers under any obligations to block access to certain sites or content? Are consumer VPN services regulated or blocked?

There are no general obligations to block access.

However, UK copyright law contains a process, under section 97A of the Copyright, Designs and Patents Act 1988, under which content owners have successfully sought injunctions against specific ISPs in connection with sites which are known to be consistent infringers of IP. Such orders have to date been made requiring most of the major ISPs to block content from, e.g., Pirate Bay, Newzbin and a number of other services which offer peer-to-peer or live streaming services.

The Internet Watch Foundation is a voluntary organisation which helps operators and ISPs identify and block access to certain illegal content.

Whilst there is no regulation of consumer VPN services in the UK, streaming services based in the UK have started to introduce measures to prevent users from using VPN to bypass geoblocking.

Originally published in ICLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.