Part 11 of the Levelling-Up and Regeneration Act 2023 empowers the government to require disclosure of information relating to land ownership and control with the aim of identifying those who hold “relevant contractual rights” in land across England and Wales. The government has launched its consultation along with draft Regulations, to seek views from individuals, organisations and businesses on the implications of collecting and publishing information on contractual control agreements.
The consultation closes on 20 March 2024, and any responses can be submitted here.
Which agreements will be captured?
The consultation aims to capture contractual control agreements, being any agreement which secures land or property for residential, commercial or mixed-use developments. Examples of these include option agreements, pre-emption agreements, conditional contracts and promotion agreements. In essence, any contractual arrangement which binds the landowner into a future disposition is sought to be caught and the relevant information supplied.
At present, the intention is that provision of information will only be required for arrangements which have a duration of 12 months or more, relate to registered land and are entered into after 6 April 2021 (or where the original agreement is varied or assigned after that date).
What information is to be published?
Whilst many developers/promoters protect contractual control agreements by way of a restriction and/or unilateral notice on the affected land at HM Land Registry, there is no legal requirement at present to provide information on such agreements. The government acknowledges that there is a need to balance the provision of transparent, detailed and accessible data whilst still protecting commercially sensitive information. The proposal is to include key information, such as:
- Type of agreement;
- Contracting parties (including Companies House registration number, Charity Commission registration number or similar);
- The date the agreement was entered into;
- The start date and expiry date of the agreement (including any periods permitted for extensions);
- Territorial extent of agreement;
- Title numbers of land affected; and
- Solicitor Regulation Authority number for the solicitors involved in the transaction.
Where a new relevant contractual control agreement is entered into, the grantee (the developer/promoter/pre-emption holder) will be obliged to provide the aforesaid information within 60 days of the agreement being entered into. The government suggests that this information is provided by the conveyancer acting for the grantee to ensure accuracy. This information must be supplied before HM Land Registry will process any applications to register a restriction or notice protecting the agreement.
The government intends to also collect data relating to existing agreements which will subsist for more than 12 months from the commencement date of the draft Regulations. The grantee will have a period of 12 months following commencement of the Regulations to provide the relevant information. Where any contractual control agreement is varied so as to vary the relevant information, this updated information will also need to be provided to HM Land Registry.
What are the implications if you do not provide the information required?
As stated above, HM Land Registry will refuse to register any restriction or notices where the relevant information is not provided.
Where information is not provided or false information is given knowingly or recklessly, this would constitute a criminal offence under the Levelling Up and Regeneration Act 2023 which carries a maximum of 2 years imprisonment and an unlimited fine.
Is greater transparency required?
The government acknowledges there is a balance to be struck between the extent of information necessary to give a clear picture of contractual control agreements and protecting the commercial interests and commercially sensitive information of landowners, developers and promoters. Whilst the information intended to be caught by the Regulations is limited, it still includes key information such as the end date for the agreement. This is likely to cause concern for developers/promoters, as this information could be utilised by competing developers/promoters if they wish to seek their own agreement for that land.
This additional information might be beneficial to local authorities, who can use this information to inform their development plans and housing supply requirements. Whilst it may benefit local authorities, developers/promoters usually have obligations to actively promote land under their control and the question has to be asked as to whether greater transparency would add much benefit to local authorities in determining land to include in its local plan.
If the draft Regulations are implemented, the administrative burden on grantees, their conveyancers and HM Land Registry would increase significantly. That, coupled with the sanctions imposed on those in breach of the Regulations and the commercial sensitivity of the information, calls into question whether the need for greater transparency has been prioritised above other matters.
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