June 2001

Contents

Chapter 1 Introduction

Chapter 2 Background

Chapter 3 The most appropriate type of guarantee

Chapter 4 The Liability

Chapter 5 Proposed changes in legislation

Chapter 6 Questions to which specific responses are requested

Chapter 7 The consultation process

Annex A

Annex B

Chapter 1 Introduction

1.1 The purpose of this consultation is to seek views from the industry, highway authorities and other interested parties to assist Oftel in updating its policy in relation to funds for liabilities. In particular it will consider how a procedure can be put in place which will enable the Director General of Telecommunications (the Director) to be satisfied that telecommunications operators, who have the benefit of the Telecommunications Code and are creating infrastructure on public land (Streetworks), have sufficient funds available to meet any possible liabilities (as defined in Condition 16 of Schedule 4 to a telecommunications operator’s licence).

1.2 Oftel’s published Management Plan for 2001/2 makes reference to a set of high level objectives and principles for the discharging of its functions in an increasingly competitive telecommunications market. These principles, amongst other things, express a wish to keep regulation to the minimum necessary to obtain the appropriate outcome and a wish not to create disincentives for new market entrants or incumbents to invest in infrastructure or to innovate in the provision of new services. There is also a need to encourage industry to meet the needs of consumers rather than rely on the regulator.

1.3 We would also wish to encourage industry, whenever feasible, to regulate itself in those areas where a common approach is necessary. If there is a will within the industry for such self-regulation then any Oftel role can be a fallback one. The policy on Funds for Liabilities which emerges following this consultation should be consistent with those principles.

1.4 As competition in telecommunications continues to develop and more and more new and innovative services are being offered by telecommunications operators, there is a continuing need for these operators to have access to highway authority land in order to build out infrastructure. Equally there is a need for highway authorities, who afford access to operators for the purposes of constructing Streetworks (see note 1 below), to be reassured that sufficient funds are available to meet any liabilities should any particular operator cease to trade or have its licence revoked. In order to satisfy both of these requirements Oftel needs to produce a satisfactory scheme within a short timescale. It would assist greatly in the creation of such a scheme if interested parties were able to respond to this consultation indicating how they believe such a scheme should work.

Note:
1. Defined in section 48(3) of the New Roads and Street Works Act 1991 as the placing, maintaining etc of apparatus in a street in pursuance of a statutory right or a Street Works licence.

Chapter 2 Background

2.1 Section 10 of the Telecommunications Act 1984 makes provision in the case of licences granted by the Secretary of State for the Trade and Industry, for the use of the Telecommunications Code (the Code), a right for telecommunications operators to build infrastructure on both public and private land. Since 1984 Code Powers have been granted to an ever increasing number of operators, the overwhelming majority of whom are holders of Public Telecommunications Operator (PTO) Licences, designated as such under Section 9 of the Act. There are a very small number of non-PTO licensees who also have the benefit of the Code.

2.2 Section 10(4)(c) of the Telecommunications Act permits the Code to be granted subject to exceptions and conditions which appear to the Secretary of State to be requisite or expedient for the purposes of securing that there are funds available for meeting any liabilities which may arise from the exercise of the rights conferred by or in accordance with the Code. In this context a condition, Condition 16, is now included in Schedule 4 of any licence where the Licensee has the benefit of the Code.

2.3 In 1984 the obligation was not felt to be appropriate in the case of BT and Kingston Communications. However following the implementation of the Licensing Directive (see note 2 below) with its non-discrimination obligations, changes were made to both the BT and Kingston licences in September 1999 to bring them into line with other PTO licences.

2.4 Condition 16 places an obligation on the operator concerned to satisfy the Director that arrangements have been put in hand to ensure that sufficient funds are available to meet any liabilities to the Appropriate Authorities (see note 3 below) after the occurrence of a Relevant Event (see note 4 below). A Relevant Event is defined in the licence as the revocation of the licence, without the immediate grant of a similar licence, or if the Licensee ceases to trade.

2.5 In the past, with only a comparatively small number of operators having the benefit of the Code, the process of satisfying the Director was carried out on an ad hoc basis, usually at the request of any Licensee who needed access to public land for the purposes of constructing infrastructure. However the increasing number of operators utilising the Code and the growing concerns of highway authorities to ensure that there are sufficient funds available to meet liabilities, has rendered such an ad hoc system inappropriate and it is now necessary to develop and implement a scheme which is uniform for the entire industry and is sufficiently transparent and non-discriminatory to meet the requirements of the Licensing Directive.

2.6 Oftel has had informal discussions with both the industry and local authorities and a number of helpful suggestions and comments have been received. Where appropriate these have been taken into account in the drafting of this consultation document.

Notes:
2. Directive 97/13/EC of the European Parliament and the Council of 10th April 1997 on a common framework for general authorisations and individual licences in the field of telecommunications services.
3. As defined in section 49(6) of the New Roads and Street Works Act 1991.
4. As defined in Paragraph 1 of Part 1 of Schedule 4 of all telecommunications licenses which have the benefit of the Code.

Chapter 3 The most appropriate type of guarantee

3.1 Oftel needs to consider how best the need for satisfactory arrangements can be met and from the advice Oftel has received it appears to us that there are two ways in which an operator could satisfy the Director that funds for liabilities are and will continue to be available, although we should like to hear from respondents on other ways which they think may be equally or more appropriate. The two methods which have been suggested are either to ensure satisfactory insurance cover or to obtain a bond/guarantee by the operator concerned.

3.2 There are however a number of clear options about the way in which these guarantees or an insurance policy could be arranged. While the list set out below is by no means exhaustive, it is considered to represent the principal options. They are:

• To allow the existing informal arrangement to continue.
• To insist on a guarantee/performance bond for every operator who has the benefit of the Code.
• To insist on adequate insurance cover from every operator on an individual basis.
• A performance bond or insurance, but limited to new operators, or operators whose ownership is based overseas and who do not have an established presence in the UK.
• An industry wide bond/insurance policy to which all the operators would be obliged to contribute.

Each of these will now be considered in turn, but it is necessary first to examine the criteria against which the options need to be evaluated.

3.3 Any scheme must conform to the fundamental principles set out in the Licensing Directive, that is to say transparency, non discrimination and proportionality. In addition wherever possible any scheme must be based on a concept of self regulation, with Oftel intervening only where this is absolutely necessary.

3.4 The scheme must also strike a balance between the legitimate interests of highway authorities and their stewardship of the public assets for which they are responsible and the need for operators to have reasonable access to public land in order to create communications infrastructure.

To allow the existing informal arrangements to continue

3.5 More than three hundred licences have been granted where the Licensee has the benefit of the Code. Even taking into account acquisitions and mergers and the individual cable franchise licences which are still extant, there are between a hundred and a hundred and fifty operator groups who are required to make arrangements to satisfy the Director. A list of those licensees which have Code Powers, set out in their corporate groups, is at Annex B. The Licence Condition requires a review by the Licensee and the Director at intervals of not more than two years and the resources required for such a review would be considerable and the tasks for both Oftel and the operators would be onerous. In addition Oftel does not have the particular specialist expertise to be in a position to advise the Director on a case by case basis, without employing expensive professionals to advise on each individual proposal. The costs of these exercises would not be insignificant and would have to be born ultimately by the Licensees themselves. Also since for obvious commercial reasons individual discussions between the Director and the Operator would be carried out on a confidential basis, Oftel may not be fulfilling the requirement of transparency under the Licensing Directive, nor would there be any public independent check on whether or not the proposals as a whole were non-discriminatory.

3.6 A continuation of these ad hoc arrangements would not serve to reduce regulation or to keep Oftels involvement to a minimum consistent with the broad objectives as set out in the Management Plan. Oftel would need to agree each and every arrangement made by every operator. While it would not necessarily create additional barriers to entry for new operators and thus serve to stifle completion, Oftel does not consider that the continuation of existing arrangements would contribute to market access for new entrants.

3.7 We should be interested to hear from operators on whether or not they believe that such an ad hoc arrangement could be continued and whether they consider that a way could be found to comply with the transparency and non-discrimination obligations in the Licensing Directive, without the risk of a breach of confidentiality between Oftel and the operators concerned.

To insist on a guarantee/performance bond for every operator who has the benefit of the Code

3.8 This would mean that Oftel would have to produce objective criteria for assessing the liability in each and every case and operators would need to provide evidence at least every two years on the liabilities to which they were subject and to confirm that a bond was in place to meet those liabilities (see note 5 below). While the costs of such a bond might not necessarily be prohibitive, in many cases it would represent a charge on the assets of the operator and could in certain circumstances reduce the ability of that operator to obtain further finance for development.

3.9 On the other hand it would maintain the existing situation for individual operators, who would still have some control over the arrangements they made, which would enable them to organise their finances in a way which best suited their business plans. This option has similar difficulties to the previous option in that it would involve Oftel in a great deal of work on at least a biennial basis. Further it may offend the transparency and non- discrimination obligations in the Licensing Directive and the principle of minimum regulation wherever possible.

3.10 There are special difficulties for both new and existing Licensees, especially for the smaller operators who might find it difficult to obtain a performance bond, or more particularly might find the costs of obtaining such a bond prohibitive. A bond could provide additional problems for existing small operators which were disproportionate to the work involved and might make it more difficult for new operators to enter the market, effectively creating a barrier to entry and thus inhibiting the development of competition.

3.11 Oftel would like to know whether or not operators believe that the obtaining of individual bonds would be difficult and/or expensive and whether or not such a process would inhibit the ability of smaller operators to obtain further funding as a result of the charge which a bond could make on that operators’ existing assets. It would also be helpful to receive comments on whether or not operators would wish any discussions with Oftel in these circumstances to be entirely in confidence and whether or not they think it could cause Oftel to be in breach of its obligation of transparency and non-discrimination under the Licensing Directive.

To insist on adequate insurance cover from every operator on an individual basis

3.12 This is in some respects similar to the previous option, except that it would not create problems from the point of view of charging assets and as a consequence the possibility of reducing an operator’s ability to obtain additional funding. The obtaining of an insurance policy for annual inspection by Oftel is likely be a less onerous task than the negotiation and agreement for a bond on an annual or a biennial basis. It is however inconsistent with Oftel’s stated objectives of self and co-regulation as the industry matures and competition develops.

3.13 The cost of cover will vary from operator to operator and situation to situation, depending on the perceived risk by the insurer on each occasion. It is reasonable to deduce at this stage that the larger well established operators would be able to obtain insurance at a considerably lower premium pro rata than new operators entering the market for the first time, particularly if those operators had most of their business assets overseas. Such an arrangement could run contrary to the objectives of easy market access and increased competition.

3.14 Unless Oftel could provide a clear and objective justification for the possible discriminatory affects of such a policy, it may run contrary to the obligations in the Licensing Directive. Oftel would have to set out in advance the criteria on which the value of any liabilities would be calculated so that it could be satisfied that adequate cover had been obtained to meet any of these contingent liabilities.

Performance bond or insurance but limited to new operators, or operators whose ownership is based overseas and who do not have an established presence in the UK

3.15 This option has been included for completeness, but it is not considered to be a realistic way forward. In the first place it would weigh heavily against any new operator, and would not be conducive to the removal of market entry barriers and the fostering of competition. If an established operator had no obligations, or a less onerous obligation to make satisfactory arrangements for any contingent liabilities flowing from the construction of Streetworks, it may be both discriminatory and disproportionate to place such obligations on new entrants. Equally it is difficult to see how a policy could be implemented which did not discriminate against those operators not based in the UK and how such a discrimination could be objectively justified. It seems likely to offend the non-discrimination obligation in the Licensing Directive.

An industry wide bond/insurance policy to which all the operators would be obliged to contribute

3.16 This would be straightforward to administer from the point of view of both Oftel and the companies concerned. It would be unnecessary for Oftel and the operators to negotiate on an individual basis in order for the Director to be satisfied that funds for liabilities were available. All that would be required is an agreed formula, for the purpose of calculating the total liability of the industry, and the Director then being satisfied that adequate cover was available in the event that a Relevant Event occurred. However, all those who had the benefit of the Code would be required to sign up to the scheme as a condition of Code Powers being granted.

3.17 Problems are easy to anticipate in negotiating such a global cover. In the first place if the premiums paid by individual companies were to be based solely on the insurers’ perception of the risk, then the smaller and newer companies would be penalised severely and would be disadvantaged as against their more established and larger competitors. On the other hand if premiums were based on some objective criteria, for example the amount of infrastructure in the ground, or turnover, then any discrimination could easily operate in reverse, that is to say the older established companies who inherently would be deemed to represent a lower risk, would be paying premiums which did not reflect accurately that lower risk and could end up subsidising the premiums of the new and smaller operators. Nevertheless if these difficulties can be overcome, such a scheme would be in accord with Oftel’s aim of the minimum regulation necessary and the removal of as many barriers as possible to market entry.

3.18 As part of the work involved in preparing this consultation, Oftel has had informal discussions with the insurance industry in order to ascertain how in principle such a global insurance scheme might work. Based on these informal discussions and on information received from a broker, which had been involved in a similar situation elsewhere, confidence was expressed that a solution in the form of an industry wide bond or a similar method of risk financing could be found. Clearly such a scheme would be a matter for the industry to agree on, but membership of such a scheme could be sufficient for the Director to confirm to the Relevant Authorities that he was satisfied.

3.19 Oftel would welcome the views of the industry and any others interested, on how such a scheme might work.

Note:
5. Performance bonds are usually granted for a fee and the bondsman will secure a charge over the assets of the person to whom the bond is granted, reducing or preventing altogether the ability of that person to borrow against those assets.

Chapter 4 The Liability

The position of the highway authorities

4.1 In discussion with the highway authorities Oftel understands that they wish to be able to make good any damage from any uncompleted Streetworks and also to take such steps as they believe to be necessary in order to render safe and unobtrusive any telecommunications apparatus which still remains in their jurisdictional area following a Relevant Event, including circumstances where an operator has failed to comply properly with its obligation as to the quality of the work and proper reinstatement. At present it is necessary for licensed operators, who have the benefit of the Code, to approach on an individual basis each and every highway authority in whose area they wish to construct infrastructure, in order to negotiate access to that area. Some highway authorities take the view that, unless and until the operator concerned is able to produce evidence that the Director is satisfied that it has sufficient funds to meet any possible liabilities (as defined in Condition 16), they will not grant access to streets for the construction of telecommunications infrastructure. That can only create additional burdens for the operators, in addition to any delays and frustrations which serve to inhibit the development of infrastructure competition. It is essential therefore that a way forward is found which enables the Director to be in a position to confirm speedily and easily that he is satisfied that a particular operator has made satisfactory arrangements in terms of funds for liabilities, so that access to public land can be made available by the highway authority within a very short timescale. In some of Oftel’s informal discussions with the industry the point was made on behalf of the operators that it was the Director who was required to be satisfied under Condition 16 and not the highway authorities. That may be true, but it is also true that in indicating that he is satisfied that funds for liabilities exist and that such funds are adequate, the Director is aware that that statement will be relied upon by any highway authority which is required to grant access to that operator. The Director will need to be confident that based on the evidence before him, the reliance of that particular highway authority on his confirmation that he is satisfied, is not misplaced.

The amount of the possible liability

4.2 Again unless Oftel is to become involved in detailed and protracted discussions with operators on an individual basis each year, a formula must be found which enables the liability of a particular operator to be calculated quickly and easily. This is obviously in the recognition that absolute accuracy in the calculation of such a liability is impossible as it would have to be forward looking. In preliminary discussions, prior to the issuing of this consultation document, Oftel has received in confidence a considerable amount of information from both the operators and the highway authorities concerned.

4.3 In order to try to evaluate the information which has been provided, Oftel has instructed a firm of Quantity Surveyors to analyse this information and advise the Director on what in its opinion are realistic assumptions and what is the best way to calculate the liability. In making its assessment the Surveyors have assumed that the systems installed by most licensees and which would create a possible liability will comprise combinations of the following types of equipment:

(a) underground cabling in trenches and/or ducts;
(b) overland cable and telegraph poles;
(c) mobile phone masts and aerials;
(d) telephone boxes;
(e) managed service phones;
(f) telephone cabinets; and
(g) microcells and other miscellaneous equipment.

4.4 It would be useful if consultees could indicate their agreement with this list of possible infrastructure units, or indicate whether there are additional pieces of infrastructure which should be added.

Calculating the Liability

4.5 It is anticipated by Oftel that most operators who are constructing infrastructure will have accurate figures on the capital cost of that construction and one of the ways of assessing the liability may well be to take a percentage of the capital cost. If funds for liabilities were arranged on the basis of an agreed percentage then it could be assumed in the majority of cases, and excluding special and unforeseen circumstances, that those funds would be adequate to meet any contingent liabilities which might arise.

4.6 The alternative method of placing specific values on each of the individual items on the above list, and then multiplying those on the basis of figures supplied by the operators, could in fact achieve an equally satisfactory result from the point of view of ensuring that funds are available. However, from both the point of view of the operators and Oftel, this second method would involve a considerable amount of additional work.

4.7 It would be helpful if consultees could indicate which of the above two methods of calculating the actual liability they think is more appropriate, or indeed whether there are other methods of calculating funds for liabilities which they think would work more effectively and would not be too onerous to administer.

How any infrastructure is dealt with following a Relevant Event

4.8 In the case of any works which are incomplete, it is assumed that if the part completed work cannot be transferred to another operator quickly then the highway authority concerned will be entitled to remove the infrastructure in the best way possible and dispose of it as it thinks fit. It will also be required to make good any damage to roadways or other public facilities. Funds for Liabilities are intended to cover all of those activities.

4.9 A more difficult issue arises in relation to infrastructure which has been completed and which is functioning when the Relevant Event occurs. If the equipment concerned can be transferred to another operator, who will be required to make any necessary arrangements in respect of any subsequent liability, then there will be no action for the highway authority concerned, except to be satisfied that arrangements have been made to deal with future liabilities. If on the other hand it is not possible for the equipment to be transferred, because no other user can be found, then there is the question of whether the equipment should be left in situ, with any safety measures being taken by the highway authority, or whether it should be removed altogether and reinstatement of the highway authority’s property carried out. Oftel was told by the highway authorities that they are concerned about potential long term dangers from underground works which could deteriorate in time and could cause damage to the surface of roads and other related environmental areas, particularly when, as is often the case, the ownership of the abandoned works is uncertain. They have indicated that they would prefer any arrangements, needed for the long term safeguarding and stability of the infrastructure, to be made as soon as possible after a Relevant Event if another operator was not available to take over responsibility for the Streetworks.

4.10 It is also recognised that significant environmental implications flow from removal of completed works and the long-term concerns of the highway authority notwithstanding, it might be preferable from an environmental point of view if the completed infrastructure were to be left in situ, particularly if its removal would involve the opening up of road surfaces.

4.11 Oftel would welcome the views of both operators and highway authorities on what they think should happen in the case of part completed works in the short term, where an alternative infrastructure provider cannot be found and also separately what they consider is the best way to deal with completed infrastructure both in the short, medium and long term.

The length of the contingent liability period

4.12 Liability to highway authorities will only arise following a Relevant Event. It is not in dispute that any Streetworks in situ will have to be completed and if possible transferred to another telecommunications operator. However, where Streetworks are left in situ a contingent liability will remain for which an appropriate remedy will be required, in the form of an ongoing liability by whatever method of guarantee is arranged.

4.13 Oftel would be interested in the views of consultees on what would be the appropriate period of such an ongoing liability. A period of six years, mirroring that in simple contract law has been suggested as the most appropriate period. This would bring the matter to an end at a time when the risk of further liability would be minimal and should not place undue burdens on the operators or their insurers/guarantors. The alternative is a period of 12 years mirroring agreements made by deed, which we understand is the normal arrangement between some operators and their contractors.

4.14 Oftel would therefore welcome suggestions, from both the industry and highway authorities supported by argument as to why a particular period is appropriate.

Chapter 5 Proposed changes in legislation

5.1 Consultees will be aware that in its White Paper ‘A New Future for Communications’ the Government announced its intention to create a single communications regulator, OFCOM. It is intended also that access to public and private land will continue and will be authorised by a new statutory scheme to be known as the Communications Code.

5.2 While Government has yet to decide on the detail of any proposed new statutory scheme, it is clear that some procedure will be needed to ensure that adequate arrangements exist which will provide the assurances highway authorities require when granting access to communications operators to enter onto public land.

5.3 In responding to this consultation, consultees may wish to express a view on whether these or similar arrangements are still needed, or whether it is possible to leave these matters entirely to the operators and highway authorities to negotiate privately on an individual basis. If a formal statute based scheme is to continue, their views would be appreciated on whether it should be administered by OFCOM as successor to Oftel, or whether it is better to remain with the Secretary of State.

Chapter 6 Questions to which specific responses are requested

6.1 In the carrying out of this public consultation Oftel would welcome answers to the following specific questions.

(a) A scheme needs to be created which will provide highway authorities with the assurances they require. How do consultees consider such a scheme should be structured?

(b) Are there any other ways apart from insurance and bonds/guarantees which consultees consider could provide such assurances?

(c) Could the present ad hoc arrangements continue and if so how could Oftel meet its obligations of transparency and non-discrimination under the Licensing Directive while maintaining confidentiality in its dealings with individual operators?

(d) Would individual performance bonds/guarantees work to inhibit the ability of some operators to obtain funding for development and would any scheme based on bonds/guarantees by individual operators be discriminatory?

(e) How could a global scheme of insurance covering the whole industry work in practice and is it likely to operate in a discriminatory manner? 

(f) Should there be any additions or other changes to the list of types of telecommunications apparatus listed in paragraph 10.2?

(g) Which of the two methods of calculating liability as set out in this consultation document do consultees consider to be more appropriate, or are there other methods of calculating such liability which they consider would be more appropriate?

(h) What action is most appropriate in the case of part completed works?

(i) What is the most appropriate period for contingent liabilities?

Chapter 7 The Consultation Process

7.1 The closing date for comments on this document is 20 August 2001. There will then be a further two week period during which comments on the representations made are invited. This will end on 3 September 2001. Comments should be made in writing and sent to:

Javier Camarena
Regulatory Policy
Oftel
50 Ludgate Hill
London
EC4M 7JJ

Tel: 020 7634 8839
Fax: 020 7634 8847

E-mail: javier.camarena@oftel.gov.uk

7.2 Confidential responses should not be sent via the Internet. Written comments will be made publicly available in Oftel’s Research and Intelligence Unit except where respondents indicate that the response, or parts of it, is confidential. Respondents are therefore asked to separate out any confidential material into a clearly marked annex. In the interests of transparency, respondents are requested to avoid confidential markings wherever possible. Appointments to view written comments in Oftel’s Research and Intelligence Unit must be made in advance (tel: 020 7634 8761, fax: 020 7634 8946).

Internet

7.3 This document is available on Oftel’s website at www.oftel.gov.uk/publications/licensing/2001/funds0601.htm. Oftel would like to set up a link between this document and any responses placed on respondents’ own Internet pages. Please contact Jo Hamilton at Oftel on 020 7634 8755 or by e-mail at web.oftel@gtnet.gov.uk to arrange this.

7.4 Oftel has a free e-mail based mailing list to help people stay informed about the work that Oftel is doing. Each time an Oftel document is published and placed on Oftel’s website at www.oftel.gov.uk, subscribers to the list receive an e-mail informing them about the document. To register, please go to the What’s New section of the website and link to the electronic form.

Alternative formats

7.5 Copies of this consultation document are available on disk. The summary can also be made available in large print, Braille, and tape formats.

7.6 Please contact the Oftel Research and Intelligence Unit on 020 7634 8761 or by e-mail at infocent@oftel.gov.uk for more information.

The consultation criteria

7.7 Oftel considers that this document meets the Cabinet Office code of practice on written consultation documents. The code is reproduced below for convenience. If you have any comments or complaints about this consultation process please contact:

Oftel Co-ordinator for the code of practice:
Rob Jex
Oftel
50 Ludgate Hill
London
EC4M 7JJ

Tel: 020 7634 5340
Fax: 020 7634 8943

E-mail: rob.jex@oftel.gov.uk

7.8 Timing of consultation should be built into the planning process for a policy (including legislation) or service from the start, so that it has the best prospect of improving the proposals concerned, and so that sufficient time is left for it at each stage.

7.9 It should be clear who is being consulted, about what questions, in what timescale and for what purpose.

7.10 A consultation document should be as simple and concise as possible. It should include a summary, in two main pages at most, of the main questions it seeks views on. It should make it as easy as possible for readers to respond, make contact or complain.

7.11 Documents should be made widely available, with the fullest use of electronic means (though not to the exclusion of others), and effectively drawn to the attention of all interested groups and individuals.

7.12 Sufficient time should be allowed for considered responses from all groups with an interest. Twelve weeks should be the standard minimum period for consultation.

7.13 Responses should be carefully and open-mindedly analysed, and the results made widely available, with an account of the views expressed, and reasons for decisions finally taken.

7.14 Departments should monitor and evaluate consultations, designating a consultation co-ordinator who will ensure that all the lessons are disseminated.

Annex A

Condition 16 

FUNDS FOR MEETING LIABILITIES

16.1 In respect of the period commencing on the date of this Licence until 31 March 1999 and thereafter in respect of every period of one year beginning on 1 April the Licensee shall make such arrangements as will satisfy the Director (which arrangements shall be reviewed jointly by the Director and the Licensee at least every 2 years) that sufficient funds are available to the Appropriate Authorities after the occurrence of a Relevant Event to meet the liabilities described in paragraph 16.2 below which have arisen on or before the date on which that Event occurred or may arise thereafter from the exercise of rights conferred upon the Licensee by paragraph 9 of the Telecommunications Code.

16.2 The liabilities referred to in paragraph 16.1 above are:

(a) liabilities, including for the payment of indemnities in respect of costs or expenses incurred, arising under the New Roads and Street Works Act 1991 or, in Northern Ireland, the Electricity Supply (Northern Ireland) Order 1972, as amended by the Telecommunications (Street Works) (Northern Ireland) Order 1984, towards:

(i) any Appropriate Authority, Traffic Authority or other responsible authority under that Act;

(ii) any other person having the authority to execute works in, or having apparatus in, a Street;

(iii) any concessionaire within the meaning of section 1 of that Act, or in the case of Northern Ireland within the meaning of Article 23(1) of the Roads (Northern Ireland) Order 1993;

(b) any other costs or expenses reasonably incurred by any Appropriate Authority or other responsible authority in making good any damage caused by the Installation or removal of Telecommunication Apparatus, whether such damage occurs before or after the Relevant Event;

(c) any other costs or expenses reasonably incurred by any Appropriate Authority or other responsible authority after the Relevant Event occurs in removing any Telecommunication Apparatus:

(i) which is Installed under, over, along or across a Street;

(ii) which is not, or is no longer, used for the purposes of any telecommunication system and in relation to which there is no reasonable likelihood that it will be so used; and

(iii) the removal of which is desirable having regard to any harm it may cause to other persons or property, or to the visual amenity of properties in proximity to which the Apparatus is Installed.

16.3 Where the Director is not satisfied that the arrangements made by the Licensee are adequate to secure that sufficient funds are available after the Relevant Event occurs for meeting the liabilities described in paragraph 16.2 above he may direct the Licensee to take such steps as he considers appropriate for the purpose of securing that such sufficient funds are available and the Licensee shall comply with any such direction.

Annex B

Every effort has been made to ensure that the information provided in this list of licensees is accurate. However changes may occur at any time. New licences are granted regularly and licences are revoked from time to time. Also convergence and other corporate restructuring can take place at any time and, involving one or more licensees.

Oftel accepts no liability whatsoever for the currency and accuracy of this information. Up to date information in relation to telecommunications licences is contained on the Public Register.

For Public Register enquiries please contact the Research and Intelligence Unit, Oftel, 50 Ludgate Hill, London, EC4M 7JJ, tel. 020 7634 8761, fax 020 7210 8946, e-mail: infocent@oftel.gov.uk.