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What, Where, Who and When? – Contractual Control Agreements on Land

Property planning land registry

The Government, in its ever increasing era of transparency, is currently consulting on contractual control agreements on land.

This will apply to England and Wales with the aim of increasing transparency around “contractual arrangements used to exercise control over the buying and selling of land” by creating a public register of interests of certain agreements such as options, rights of pre-emption and estate contracts (but not overage or clawback agreements). The Government has said it wants to “seek to create a dataset comprising the “what”, “where”, “who” and “when” of contractual control agreements that will promote transparency by providing a reliable and accessible source of information for communities, developers, and other stakeholders”.

Under such proposals, beneficiaries of contractual arrangements would need to disclose certain information about their arrangements to the Land Registry within 60 days of any eligible arrangement being entered into. The Government has indicated making such data publicly available, would make it easier to identify development opportunities within a local community and assist smaller developers in understanding what land is available to explore for development purposes. Surely, local land agents are best placed to identify (and know about) available development sites?

The scope of data to be collected is existing agreements entered into from 6 April 2021 (5 years before the expected commencement of the regulations, which is expected on 6 April 2026) as well as on extant agreements entered into at any time, if they are varied in such a way that alters any of the required information or are assigned from the commencement date of the regulations. Data will need to be provided within 60 days of arrangements being entered into.

Currently there is no legal requirement to provide information on contractual arrangements and the Government is concerned this means “it is impossible to gain a complete picture” of affected land which it believes then delays development. Currently, the vast majority of contractual arrangements involving land are partly publicly available as most beneficiaries either register a unilateral notice (which will list the benefitting party) or a title restriction on the registered title of the affected land, meaning that solicitors (or anyone else reviewing the registered title) can establish if there is likely to be some form of contractual control (such as an option) in place. It remains unclear exactly what additional information would be published from the collected data set.

Furthermore, the Government is not seeking to collect controls data on unregistered land, which is arguably a more pressing area of ownership transparency!

In a time where profit margins are being squeezed more and more, this will be yet another hurdle for those in the development sphere to overcome. For those whose core business it is to promote and gain planning permission on land before selling to a third party, or for those who use options and pre-emptions within their development business or as part of a complex development transaction, will need to undertake an extensive audit of all their contractual arrangements, collate data and provide this to the Government in a timely fashion.

Similar to the rules for overseas land ownership (please refer to our article here), there will be criminal penalties for non-compliance and the Land Registry will refuse to register a notice or restriction to protect a control agreement unless information regarding the agreements has been provided.

The consultation is currently open until 20 March 2024. The link to the consultation briefs can be found here.

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