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Should Wales follow England's lead in ACV legislation?

The Welsh Government has issued a consultation on protecting community assets. Its aim is "to consider the best ways to protect assets for the benefit of communities, while being realistic about the costs and challenges involved in doing this and respecting the rights of asset owners." So how do they propose doing this?

Whilst there are some suggestions in the consultation that the Welsh Government wants the Welsh system to be more far-reaching than the English equivalent, it is also clear that they are seeking to address issues that have arisen with the English system.

For example, the consultation makes it clear that "neglected or abandoned properties which are not being used currently for the benefit of the community" are being considered within the scope of the consultation. The English system enables community nominations of such properties as Assets of Community Value (ACVs). It provides that a property which in the recent past furthered the social well being or interests of the local community can be listed as an ACV if it is realistic to think that there is a time in the next five years when it would do so again. However, what constitutes the recent past is open to interpretation. This can lead to buildings which have no realistic prospect of ever being brought into community use being listed as ACVs simply as a means of blocking development. The consultation seeks to address this sort of issue by asking whether the definition of Assets of Community Value contained in the Localism Act 2011 is appropriate for use in relation to protecting assets in Wales.

Three options for a Welsh system are set out in the consultation:

  • Adopt a very "light touch" approach, where legislation is not brought in. The focus would be, instead, on achieving greater community involvement in the management of local facilities with the consent and cooperation of landowners. However, as the consultation sets out, this would not give any legal protection to community assets; it would rely on cooperation and focus on support for communities.
  • Follow the approach set out in the Localism Act 2011. If this approach is taken forward, the Welsh system would follow the one in England, with all the associated issues that have been encountered.
  • Develop a new Welsh model. This is likely to require primary legislation. The consultation suggests that a Welsh system may provide, amongst other things, for communities having increased rights to approach Public Sector Bodies to initiate assets transfers and/or having a right of first refusal on Private Sector Assets. This would be of great concern to landowners and would be more far-reaching than the current English system.

Anyone who has had their property successfully nominated as an ACV in England will know how frustrating and obstructive the legislation is. The approach of local authorities to whether a particular type of nomination is successful differs greatly and some local authorities add properties to ACV lists following very weak nominations. Although there is a right to request a review of an ACV listing, this review is also carried out within the local authority.

Once on an ACV list, the rights of the landowner are severely hampered. If the landowner wants to dispose of the property, either by way of a freehold sale or the grant of a lease for a term of 25 years or more, it must (unless the transaction falls within a limited list of "excluded disposals") inform the local authority of its intention. This triggers an initial moratorium of six weeks, during which time the landowner can only dispose of the property to a community interest group. If a community interest group expresses an interest in buying the property (regardless of whether they have, or have any prospect of raising, a realistic sum to do this) a full moratorium of six months is put in place. This prevents the owner from selling, or entering into a contract to sell, to anyone other than a community interest group for this six month period. It has been proposed that this period be extended to nine months. A nine month delay on any disposal on the open market would further infringe the landowner's rights.

In England, pubs, village shops, community centres, libraries, and open space are examples of types of properties that have been successfully listed as ACVs. If you own property in Wales you would be well advised to respond to the consultation.

Responses to the consultation are required by 11 September 2015.

Contributor: Alexandra Holsgrove Jones

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at June 2015. Specific advice should be sought for specific cases. For more information see our terms & conditions on www.TLTsolicitors.com

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