Community Right to Bid

Page last updated at 21 June 2017 at 14:13

Community Right to Bid Guidance

 

Introduction

The ‘Community Right to Bid’ (also known as Assets of Community Value) was introduced by the Localism Act 2011. The provisions read together with the Assets of Community Value (England) Regulations 2012, give community groups a right to nominate properties (buildings or other land) to be included in the Eastleigh Borough Council’s (“the Council”) Asset of Community Value list.

The intention of this scheme is to allow community groups a ‘fairer’ opportunity to bid for these ‘community assets’, should they come up for sale for example.

How to get an asset listed

What type of property can be nominated?

What  must the application demonstrate?

Who can nominate?

How to nominate a property?

What happens following a nomination?

Register of Assets of Community Value

Internal Review

Tribunal review

 

Once an asset is listed

What happens when the owner wants to sell the asset?

Enforcement

Compensation

Compensation review

When will an asset be removed from the list?

 

Asset listing

What type of property can be nominated?

Although the property can be in either; private or public ownership, not all properties can be listed under the scheme; residences for example are generally excluded.

 

What must a successful nomination demonstrate?

A successful nomination must (in the opinion of the Council) satisfy both A and B of the following criteria below;

A

1.   An actual current use of the building or other land that is not an ancillary use (that is, its primary use), that furthers the social wellbeing or social interest (meaning; cultural, recreational and or sporting interests) of the local community

 -or-

2.   There is a time in the ‘recent past’ when an actual use of the building or other land that was not ancillary to the use furthered the social wellbeing or interests of the local community

B

It is realistic to think that there can continue to be non-ancillary use of the building or other land in the next 5 years, which will further (whether or not in the same way) the social wellbeing or social interest of the local community.

 

Who can nominate?

Only eligible voluntary and community organisations can make nominations. This means either a parish/town council, voluntary or other community bodies with a ‘local connection’.

Unincorporated bodies with 21 or more members for example, may be eligible where they can demonstrate evidence of a ‘local connection’.

You will find further detailed guidance on the eligibility requirements of the nominating group contained in the Nomination Form below. 

 

How to nominate a property?

Please complete and submit the Nomination Form together with any supporting information required to the Council. 

 

What happens following a nomination?

 

Initial checks of the nomination will be carried out. This will involve checking the eligibility of the nominating group and whether or not the property is within the excluded categories. The Council will seek to determine the nomination within eight weeks of receipt of the nomination.

In doing so, the Council will seek to review all the evidence available to it. Applicants are therefore strongly advised to provide as much information as possible to assist the Council in determining the application as soon as possible.

The determination decision will be made by the Council’s Strategic Planning Manager (or another officer if so approved by the Council from time to time) with the assistance of other Council officers. The Council may also invite comments from local ward members, the relevant parish council and Hampshire County Council.

If the decision is taken that the asset should not be listed, details of this decision will be provided in writing to the body making the nomination, the parish council (if there is one) and the owner/occupier as appropriate. These nominations will be added to the Council’s list of land nominated by unsuccessful community nominations, and may remain on that list for up to five years.

If the decision is taken that the asset should be listed, the land will be included on the Council’s List of Assets of Community Value. However, please note that the owner has the right to appeal against this decision, and they must do so within eight weeks of the Council notifying them of the decision.

 

Register of Assets of Community Value

Once the asset is included in the Council’s List of Assets of Community Value, the Council will seek to notify the ‘owner’ and the community group who made the nomination.

The Council will add the asset to its local land charges register and if the land is registered, apply for a restriction on the Land Registry title in form QQ.

There are also requirements on owners or mortgagees applying for first registration of listed land to apply for a restriction on the title register. They require a person who has become an owner of the land following a disposal to inform the local authority and provide ownership details.

 

Internal Review

Within eight weeks of being notified of their property being listed as a ‘community asset’, the owner can appeal to the Council for a ‘listing review'. The asset will remain listed during the review period. The owner and the Council will bear their own costs associated with the review.

Any appeal must be made in writing to the Council. The Council will then have eight weeks from the date of receiving the request to carry out the review (or an extended period if agreed between the parties).

The review will be carried out by a senior officer who was not involved in the decision to list the asset.

The owner may appoint a representative to act on his behalf in connection with the review. The Council will provide the relevant documents required to this representative and advise on the procedure to be followed for the review.

The owner may request an oral hearing; the owner and the owner’s representative may make representations to the reviewer orally and/or in writing.

The decision of the Council will be made in writing, a copy will be provided to the owner and the body who made the original nomination. If the review concludes that the asset should not be included on the List of Assets of Community Value the property will be removed from that list.

 

Tribunal review

If the owner is dissatisfied with the internal review, they will have 28 days from the date on which the Council notifies them of the internal review decision to appeal for a review by the General Regulatory Chamber of the First-Tier Tribunal.

Owners must submit their appeal in writing to the First-Tier Tribunal:

Email: GRC@hmcts.gsi.gov.uk

Post: Tribunal Clerk, Community Right to Bid Appeals, HM Court & Tribunals, First-tier Tribunal (General Regulatory Chamber), P.O. Box 9300, Leicester, LE1 8DJ

 

Once listed

What happens when the owner wants to sell the asset?

Owners intending to enter into ‘relevant disposals’ (which includes some types of sale) must notify the Council in advance, a six week interim moratorium period will then begin on the day the owner notifies the Council of their intention. The Council will then update the list to show the interim and full moratorium dates. The Council will publicise the notification and invite ‘community interest bodies’ who wish to be treated as potential bidders to come forward with an ‘expression of interest’.

During the interim moratorium period, eligible community interest groups may request (and it must be in writing) to be treated as a potential bidder of the asset; this will bring the full moratorium period into force. This ‘expression of interest’ does not need to include any financing details, nor does it bind the community interest group into making a bid.

The ‘community interest group’ must have a local connection and be either; a charity, a community interest company, a company limited by guarantee that is non-profit distributing or a co-operative and community benefit society that is non-profit distributing.

The full moratorium period runs for six months from the date the owner notified the Council of their intention to dispose of the asset. This will give community interest groups an opportunity to, for example, raise funds and make an offer to the owner.

During the interim or full moratorium period, the owner can continue to market and negotiate the sale of the property. However, unless an exempt disposal applies, the owner can only dispose of the asset to a community interest group. A community interest group which bids for the asset does not have to be the same community group which nominated the asset and/or activated the full moratorium.

After the interim or full moratorium period has expired (as applicable), the owner will have an 18 month protected period (from the date when they notified the Council of their intent to dispose), where no further moratorium periods can be triggered. During the protected period, the owner can dispose of the asset to whoever they wish.

Once the protected period has expired, the whole cycle begins again where the owner intends to enter into a ‘relevant disposal’.

 

Enforcement

Local authorities are required to include the ‘community asset’ in its local land charges register, and if the land is registered, apply for a restriction on the title register maintained by the Land Registry.

When a listed asset is disposed of, and a new owner applies to the Land Registry to register a change of ownership of a listed asset, the Land Registry will need a certificate from a conveyancer confirming that the disposal (and any previous disposals if this is the first registration) did not contravene section 95(1) of the Localism Act (the moratorium requirements).

If a non-compliant disposal of a listed asset occurs, the transfer will be ‘void’, meaning that the change of ownership has not taken place. If the transfer has been erroneously registered on the title it will still be void, and would have to be rectified. This penalty will not apply if the owner was unaware through no fault of their own that the land was listed when it was sold.

Owners are encouraged to seek independent legal advice.

 

Compensation

Private owners may claim compensation from the Council for losses and expenses incurred which would not have occurred if the land had not been included on the list.

The Regulations provide that this will specifically include a delay in entering into a binding agreement to sell, which is wholly caused by the moratorium period; or legal expenses incurred in a successful appeal to the Tribunal.

A compensation claim must be made by the owner within whichever is the earlier of 13 weeks from the end of the interim or full moratorium period (as appropriate), or from the date when the land ceased to be listed.

Claims must be made in writing to the Council, stating the amount of compensation sought and providing the necessary supporting evidence. The burden of proving the claim will fall upon the owner.

The Council will consider the validity of the claim as soon as practical and will give written reasons for the decision.

 

Compensation review

An owner who is dissatisfied with the Council’s response to their compensation claim can appeal for an internal review of the claim within eight weeks of being notified of the Council’s decision. The owner can ask for a review of the decision and/or the amount of compensation awarded.

The process for the review will be the same as for a listing review.

An owner who is dissatisfied with the outcome of the Council’s internal review of their compensation claim can appeal for a Tribunal review within 28 days of being notified of the internal review decision.

 

When will an asset be removed from the list?

A property will be removed from the List of Assets of Community Value if;

a) it has been on the register for five years;

b) the owner has been successful in a listing review;

c) the owner has demolished the listed asset;

d) the Council deems the listed asset to no longer be of ‘community value’.

A property will be removed from the Council’s list of land nominated by unsuccessful nominations if it has been on the list for five years.

When a property is removed from either list, the Council will release a statement setting out the reasons for the removal. The Council will seek to notify the owner, any leaseholders and the nominator of the statement. In the case of an asset being de-listed, the Council will also notify the Land Registry.