Land reform: back, and here to stay

Towards the end of its first term, the Scottish Parliament enacted the Land Reform (Scotland) Act 2003, conferring rights of access to the outdoors for all, and rights of community acquisition in rural and crofting areas. A desire and a drive for further land reform in Scotland remained from some quarters. This was evidenced partly by the passage of the Community Empowerment (Scotland) Act 2015, but all the more clearly by the enactment of further legislation under the land reform brand. As it happens, this also took place towards the end of a Holyrood term, as the Land Reform (Scotland) Act 2016.

The 2016 Act impacts on a wider variety of areas than its 2003 namesake. It takes in issues such as deer management (part 8), the fiscal treatment of shootings and deer forests (part 6), common good land (part 7), and agricultural holdings law (part 10). Whilst all of those changes can be brought under the broad heading of land reform, they each deal with somewhat esoteric areas that do not have much in common with the 2003 Act. Indeed, agricultural holdings law is traditionally dealt with in specific, standalone statutes: the approach adopted when the Agricultural Holdings (Scotland) Act 2003 was passed (and in commentaries in this Journal).

As such, this article will focus on aspects that build on the 2003 Land Reform Act, including a new community right to buy to further sustainable development, and minor reforms to outdoor access law. It will also explain the features that have the potential to affect almost all land in Scotland, namely the promised “land rights and responsibilities statement”, the new Scottish Land Commission, provisions relating to transparency of landownership, and a duty of community engagement.

The land rights and responsibilities statement

Part 1 of the 2016 Act begins by placing an obligation on the Scottish ministers to “prepare and publish a land rights and responsibilities statement”, which is “a statement of principles for land rights and responsibilities in Scotland”. That seems eminently clear, but what it will contain? This is where the clarity fades.

What we have at present is informed speculation. There are seven aspects that ministers must have regard to when preparing the statement, namely: promoting respect for, and observance of, relevant human rights; promoting respect for such internationally accepted principles and standards for responsible practices in relation to land as ministers consider relevant; encouraging equal opportunities; reducing the inequalities of outcome resulting from socio-economic disadvantage; community empowerment; increased diversity of landownership; and furthering sustainable development in relation to land. None of these seem particularly objectionable, although diversity of landownership is perhaps the most curious inclusion, as that seems to indicate facilitation of transfer in certain circumstances.

As to the form of the statement, perhaps the Scottish Outdoor Access Code – which plays an important role in relation to the right of responsible access under the 2003 Act, while falling short of primary legislation – gives a bit of a steer. The statement must be finalised by ministers within one year of the provisions coming into force; they will then be obliged to promote the statement and review it every five years.

The Scottish Land Commission

The 2003 Act deposited new rules, then left Scots law and its institutions to get on with it. The 2016 Act takes a different approach. Along with the reforms discussed below, it introduces a new statutory body, the Scottish Land Commission, with an important watching brief, in what might be thought of as the first “top down” approach to land reform for the whole of Scotland.

Unfortunately, the Commission will share an acronym with not one but two other bodies with a keen interest in Scottish land law, the Scottish Law Commission and the Scottish Land Court. The new SLC might have avoided this fate if Parliament had opted for one of the other names mooted, such as the Scottish Land & Property Commission (Final Report of the Land Reform Review Group, The Land of Scotland and the Common Good, 2014) or the Scottish Land Reform Commission (aired in the Scottish Government’s 2014 consultation). Perhaps the former was a bit unwieldy, while being tattooed with “reform” might have been a tad inflammatory to some.

Nomenclature notwithstanding, the body will comprise five Land Commissioners and one Tenant Farming Commissioner. The Commission as a whole is to be recruited on the basis of expertise and experience in land reform, law, finance, economic issues, planning and development, land management, community empowerment, environmental issues, human rights, equal opportunities, and the reduction of inequalities of outcome which result from socio-economic disadvantage.

That list expanded as the bill progressed and, following evidence and representations by the writer, a commitment to Scottish Gaelic was also introduced, in that the ministers must take every reasonable step to ensure that at least one of the commissioners is a Gaelic speaker (in line with the existing crofting and Scottish Land Court frameworks). The Tenant Farming Commissioner must also have expertise or experience in agriculture, which reflects their important role for the let farming sector in particular, dealing with the preparation and promulgation of codes of practice. As to what those Land Commissioners will do, their broad remit relates to “any matter relating to land in Scotland”, within which they can review the impact and effectiveness of any law or policy and recommend changes accordingly, gather evidence and carry out research, and prepare information and guidance.

Transparency

The pattern and distribution of landownership in Scotland is the cause of recurring comment, particularly in relation to rural areas (where there might be a perception that estates can exert a large amount of influence, as discussed in the Final Report of the Land Reform Review Group, part 6), but also in relation to urban and peri-urban areas, where there might be “banking” of land, denying an alternative use.

Making a proper analysis of the extent to which these things are happening, or working out who communities need to communicate with to resolve any difficulties, is not always a simple process, owing to the occasionally patchy information about who controls what at present. That patchiness may relate to a lack of clearly mapped data on easily accessible public registers for land, or to a lack of clarity about who directs a landowning entity that is not a natural person.

In relation to the former, readers of the Journal will know that full completion of the Land Register has a target date of 2024. As for the latter, the extent to which non-transparent ownership is a problem is difficult to gauge. In proceedings at the Scottish Parliament’s Rural Affairs, Climate Change & Environment Committee in the run-up to the 2016 Act, an estimate that some 750,000 acres of Scotland was owned via non-transparent entities was discussed and not doubted. That figure appeared in the magazine Private Eye (26 June 2015).

To bring greater publicity, part 3 of the 2016 Act stipulates that ministers introduce regulations “requiring information to be provided about persons who have controlling interests in owners and tenants of land”. Further regulations may allow the Keeper to require information from owners and registered tenants. Once again, much is left for the future, but it is clear that this will have an impact for any practitioners acting for non-natural clients and those who are in a position to influence such entities.

Community engagement

Part 4 began as a rather bare duty on ministers to introduce guidance about engaging communities in decisions relating to land which may affect them. Whilst that remains the core effect of s 44, as the bill progressed the section became substantially longer: initially the guidance was to focus on furthering the achievement of sustainable development; after stage 2 it also included “relevant human rights”, equal opportunities and aspects of social justice; and at stage 3 it was further expanded to bring in internationally accepted principles and standards for responsible practices in relation to land.

There is a duty on ministers to report on how things are going after an initial three year period and then every five years. Presumably, if things are going well and landowners are engaging with communities in decisions that affect them, no further legislation will follow. If otherwise, the soft model of regulation could be replaced by something stronger. That said, there is a cute tie-up between parts 4 and 5, as ministers can take into account the extent to which regard has been had to s 44 guidance in determining whether an application to buy land meets the “sustainable development conditions” to be met on a community buyout (s 56(4)), so this guidance could be important in certain contexts when a community tries to force a sale. It is that forced sale power (which is probably the most radical aspect of the 2016 Act, away from the agricultural holdings reforms) that will be looked at now.

Further community right to buy

As already noted, the 2003 Act introduced two community rights of acquisition. The 2015 Community Empowerment Act amended these in a number of ways, most notably widening the potential forms of juristic persona beyond companies limited by guarantee, and expanding the rural right to buy (2003 Act, part 2) to cover the whole of Scotland (see Combe, “Digesting the Community Empowerment Act” (Journal, August 2015, 40)). These reforms took effect on 15 April 2016.

Even more notable was a brand new right, allowing communities to force a sale of “wholly or mainly abandoned or neglected” land or environmentally detrimental land, in terms of a new part 3A in the 2003 Act. Consultation is underway about the “community right to buy abandoned, neglected or detrimental land”, as it is termed on the Scottish Government website; responses are due by 20 June 2016 (see consult.scotland.gov.uk/community-land-team/abandoned-land). Part 5 of the 2016 Act brings yet another right.

There are many similarities with the other rights of acquisition, but some contrasts can be highlighted. First, the new right has more in common with rights over crofting land (2003 Act, part 3) and neglected, abandoned or environmentally detrimental land (part 3A), going beyond pre-emption and allowing for compulsion (for value) when a community’s scheme is demonstrably better than an existing land use. Quite properly, such profound effects will not be unlocked automatically. Consent for community acquisition can only be given where ministers are satisfied that procedural requirements have been met, including the land being eligible (which it cannot be if it is the current owner’s home) and that the buyout has been approved by the community by ballot.

Exercise of the right to buy must also meet the “sustainable development conditions”. As per the existing rights to buy, this will only be the case if the transfer of land is likely to further the achievement of sustainable development in relation to the land and is in the public interest. Also as per existing legislation, neither public interest nor sustainable development is defined, but this has not been seen as problematic in litigation (see Pairc Crofters Ltd v Scottish Ministers [2012] CSIH 96, commented on by Combe, “Ruaig an Fhèidh: 3” (Journal, February 2013, 31)), and it is generally accepted that sustainable development takes in social, economic and environmental concerns.

Where the 2016 Act differs is in asking that more hurdles than public interest and sustainable development be cleared. The transfer of land must also be likely to result in “significant benefit” to the relevant community, and must be “the only practicable, or the most practicable, way of achieving that significant benefit” (s 56(2)(c)). There is then a further test that “not granting consent to the transfer of land is likely to result in harm to that community” (s 56(2)(d)). Those additional conditions bring the ideas of “significant benefit” and “harm” to the fore; both are to be determined by an analysis of a community’s economic development, regeneration, public health, and social and environmental wellbeing. (None of these terms are defined, but environmental wellbeing features in the right of acquisition in part 3A of the 2003 Act.)

One other innovative feature of part 5 is that a community may nominate a third party acquirer, albeit the transfer to such a nominee would still need to meet all the tests already mentioned, mutatis mutandis.

Taken together with the new framework for community engagement and the existing community rights to buy, it can be seen that a community now has a number of tools to encourage or even force land to be used in a certain way that is more suited to its needs, subject to due process being followed and certain, often stringent, tests being met.

Access rights

Not much need be said of access, but for complete coverage of the interplay with the 2003 Act it is worth mentioning that part 9 of the 2016 Act makes some changes relating to the review and amendment of core paths (the network that all local authorities are responsible for to give the public reasonable access in their area), and also makes an amendment to allow for the service of court documents on someone allegedly taking access in a way that is not responsible.

Not the end

The 2016 Act represents another important step in the land reform journey that Scotland seems to be on. Despite all that it contains, it could have been more radical: for example, the Land Reform Review Group considered a possible cap on landownership above a certain level, pondered restrictions on landholding entities registered outwith the EU, and mooted the introduction of compulsory sale orders (another tool that could be brought to bear when community acquisition was not viable). None of those appear in this particular measure, but there are indications from political parties that further land reform is possible. When that prevailing political climate, the new Scottish Land Commission, and the preparation and ongoing review of measures to do with community engagement and land rights and responsibilities are all mixed together, it seems clear that land reform is not going to retreat into the background any time soon.