Edge Telecommunications Ltd v Office of Communications (“OFCOM”)

Hearing dates: 15 & 16 October 2025

Approved Judgment

This judgment was handed down remotely at 10.30am on 30 October 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

Introduction

In these proceedings, the Claimant (“Edge”) claims damages for breach of statutory duty – section 8(4) of the Wireless Telegraphy Act 2006 – by Ofcom, the United Kingdom regulator for, amongst other things, telecommunications. The breaches alleged are that Ofcom failed to make regulations which would permit the commercial use of telecommunications apparatus known as GSM Gateways without, first, obtaining a licence. Edge alleges that at all material times it was a commercial operator of GSM Gateways and that the fact that this type of equipment was not exempted from the requirement for a licence has caused it loss and damage.

On 11 June 2024 a trial of the following preliminary issues was ordered by consent, and I heard argument on 15 and 16 October 2025:

i) Whether Edge's claims are time-barred?

ii) Whether as a matter of law Edge has an actionable claim in damages in relation to the breaches of statutory duty which it alleges?

I did not hear any evidence for the purposes of determining these issues. However, I was provided with a Schedule of Agreed Facts and there was also a statement of Mr Edward Mercer dated 13 May 2025. He is a solicitor who acts for Edge and he provided background information and his views on various matters. Neither party specifically referred to his statement and, with respect to him, it was of limited assistance in relation to the preliminary issues.

The factual and legal context for the claims

GSM Gateways are items of telecommunications equipment which incorporate one or more SIM cards issued by a Mobile Network Operator (“MNO”). They allow the device on which the SIM card is installed to originate calls and texts on the MNO's network. As a result, calls from fixed lines to mobile networks are treated by the recipient's network as if they were made by a mobile phone, rather than from the fixed line phone. This means that the charges for the call are lower than they would have been had the call been treated as having been made from a fixed line. A GSM Gateway can therefore save money for a user who makes calls from a fixed line to mobile phones and for this reason they have been widely used by businesses and public bodies to reduce their phone bills.

GSM Gateways may be “self-use gateways”, which are used by the user itself, or “commercial use gateways”, which are provided by a business as part of a service to a customer. There are two types of commercial use gateway: commercial single user gateways, or “COSUGs”, have a single end user from which all the calls diverted through the gateway originate; commercial multi-user gateways, or “COMUGs”, have multiple end users so that the calls diverted through the gateway originate from more than one user. The business using the GSM Gateway to provide electronic telecommunications services seeks to make a profit by charging its customers rates for use of the Gateway which mean the customer pays less for their calls from fixed lines than they would otherwise have had to pay to a MNO.

At all material times the position in law has been that the establishing or use of any station, or the installation or use of apparatus, for wireless telegraphy requires a licence unless an exemption applies. This was the effect of section 1(1) of the Wireless Telegraphy Act 1949 (“WTA 1949”), which also enacted a general power of the Secretary of State to provide, by regulations, for exemptions of such classes or descriptions of stations or apparatus as may be specified in such regulations. It was common ground before me that a GSM Gateway falls and fell within the definition of “apparatus” for these purposes at all material times.

The use of telecommunications equipment was, however, regulated by Council of the European Union Directives which were transposed into United Kingdom law by primary and secondary legislation. The most relevant of these Directives for present purposes is the Authorisation Directive (2002/20/EC) which formed part of the Common Regulatory Framework and was required to be implemented by Member States by 24 July 2003. When the Authorisation Directive was first adopted in 2002, Article 5 provided, so far as material, as follows:

“ Rights of use for radio frequencies and numbers

1. Member States shall, where possible, in particular where the risk of harmful interference is negligible, not make the use of radio frequencies subject to the grant of individual rights of use but shall include the conditions for usage of such radio frequencies in the general authorisation.” (emphasis added)

Article 5(2) then dealt with the procedure for obtaining a licence where such was necessary. In very broad summary it required that such procedures be open, transparent and non-discriminatory.

The Common Regulatory Framework was implemented in the United Kingdom primarily through the Communications Act 2003 (“CA 2003”) which contained many of the required provisions and which also made amendments to the WTA 1949. The CA 2003 designated Ofcom as the national regulatory authority which had responsibility for many of the functions set out in the relevant Directives and transferred to Ofcom the powers of the Secretary of State to grant licences and make regulations under section 1 of the WTA 1949. However, section 5 of the CA 2003 provided that the Secretary of State had a power to give directions for specified purposes including in the interests of national security and, under section 5(2), that it was the duty of Ofcom to carry out its relevant functions in accordance which such general or specific directions as were given to them by the Secretary of State.

By way of implementation of Article 5 of the Authorisation Directive, section 166 of the CA 2003 also inserted a new section 1AA of the WTA 1949. This enacted a requirement that Ofcom make regulations exempting the installation and use of specified descriptions of stations or apparatus if it was satisfied that their use was not likely to involve undue interference with wireless telegraphy.

With effect from 7 February 2007, however, the WTA 1949 was repealed and replaced by the Wireless Telegraphy Act 2006 (“WTA 2006”). The position under sections 1 and 1AA of the WTA 1949 was reproduced under section 8 of the WTA 2006 which provided, so far as material, as follows:

“ 8 Licences and exemptions (1) It is unlawful—

(a) to establish or use a wireless telegraphy station, or

(b) to instal or use wireless telegraphy apparatus, except under and in accordance with a licence (a ‘wireless telegraphy licence’) granted under this section by OFCOM.

…

(3) OFCOM may by regulations exempt from subsection (1) the establishment, installation or use of wireless telegraphy stations or wireless telegraphy apparatus of such classes or descriptions as may be specified in the regulations, either absolutely or subject to such terms, provisions and limitations as may be so specified.

(4) If OFCOM are satisfied that the condition in subsection (5) is satisfied as respects the use of stations or apparatus of a particular description, they must make regulations under subsection (3) exempting the establishment, installation and use of a station or apparatus of that description from subsection (1).

(5) The condition is that the use of stations or apparatus of that description is not likely to involve undue interference with wireless telegraphy.”

In 2009, the Authorisation Directive was then amended, with a deadline for implementation of the amendments of 25 May 2011. Following these amendments, Article 5(1) now provided as follows:

“ Rights of use for radio frequencies and numbers

1. Member States shall facilitate the use of radio frequencies under general authorisations. Where necessary, Member States may grant individual rights of use in order to:

— avoid harmful interference;

— ensure technical quality of service,

— safeguard efficient use of spectrum, or

— fulfil other objectives of general interest as defined by Member States in conformity with Community law.

These amendments were transposed by the United Kingdom through the Electronic Communications and Wireless Telegraphy Regulations 2011. Section 8 of the WTA 2006 was amended by the 2011 Regulations so that the conditions of which Ofcom had to be satisfied under section 8(5) were now as follows:

“(5) The conditions are that the use of stations or apparatus of that description is not likely to—

(a) involve undue interference with wireless telegraphy;

(b) have an adverse effect on technical quality of service;

(c) lead to inefficient use of the part of the electromagnetic spectrum available for wireless telegraphy;

(d) endanger safety of life;

(e) prejudice the promotion of social, regional or territorial cohesion; or

(f) prejudice the promotion of cultural and linguistic diversity and media pluralism.'”

(Subsection (5) has since been further amended by the Electronic Communications and Wireless Telegraphy (Amendment) (European Electronic Communications Code and EU Exit) Regulations 2020 but the amendment is not material for present purposes given that it post-dates the period in respect of which the claims are made.)

As far as regulations...