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Consultation on providing greater transparency of contractual control land agreements

Reasons to choose Wilson Browne

The government is consulting on plans to require more transparency when using contractual agreements for the control of land, such as option agreements.

Part 11 of the Levelling Up and Regeneration Act 2023 contains powers to collect and publish information about contractual control agreements in England and Wales.

In 2017, the government published its White Paper Fixing our broken housing market, which included proposals for clarifying what land is available for new housing, through greater transparency over who owns land and the options held over it.

The government noted that there were “numerous ways of exercising control over land, short of ownership, such as through an option to purchase land or as a beneficiary of a restrictive covenant”. The government considered that this lack of transparency could:

  • Mean that local communities are unable to know who could benefit from a planning permission.
  • Inhibit competition, with small and medium-sized enterprises (SMEs) and other new entrants finding it harder to acquire land.
  • Risk landbanking (where an option has been acquired over land, but there is no prospect of its development).

The government therefore intended to provide a “clear line of sight” across a piece of land, setting out who owns, controls or has an interest in it.

The Levelling-up ad Regeneration Act 2023 concerned information about dealings with land.

“Relevant contractual rights” are rights which satisfy all of the following namely they:

Arise under a contract (which includes a deed, whether or not made for consideration).
Relate to the development, use or disposal of land in England or Wales.
Are held for the purposes of an undertaking (which includes a business, a charity or similar endeavour, and the exercise of functions of a public nature)

It would appear that the “contractual control agreements” could capture a variety of different arrangements relating to land, such as:

  • sale contracts;
  • transfers;
  • agreements for lease;
    leases;
  • options; and
  • pre-emption agreements.

The reference to “development” and “use” of land, could catch:

  • development documents;
  • covenants;
  • easements; and
  • potentially, landlord’s licenses.

Therefore this could be extremely wide ranging and have wide reaching implications for landowners, land promoters, and developers.

The government intends to create a dataset comprising details of contractual control agreements that will provide a source of information for communities, developers, and other stakeholders.

The consultation is seeking views on these proposals from individuals, organisations, and businesses. The Department for Levelling Up, Housing and Communities state that draft regulations are available for review (see question 40 of the consultation).

The consultation applies to England and Wales and closes on 20 March 2024.

Source: DLUHC: Consultation: Contractual controls on land (24 January 2024).

We have a wealth of experience in dealing successfully with all types of commercial property matters, offering positive advice with speed and efficiency, contact us on 0800 088 6004 if you need our guidance.

Ika Částka

Posted:

Ika Částka

Partner

Ika is Head of the Commercial Property team and has been advising individuals and businesses across Northamptonshire since 1986, specialising in commercial, agricultural and rural property matters for both businesses and individuals.