The Localism Act 2011 introduced Assets of Community Value (formerly the community right to bid) with the idea behind it to give communities more involvement in the way local services are delivered. In essence, it gives community interest groups an opportunity to purchase local land that has been registered as having a community purpose. This article will look at the process from registering land as an asset of community value through to the landowner disposing of it.
What is an Asset of Community Value (ACV)?
Land of community value is land in a local authority area that is considered to be of value to the local people, for example village halls, churches and pubs. ‘Land’ can be open spaces but can also be buildings or part of a building. When land is placed on the ACV list, it places restrictions on the landowner when they want to sell it.
Who can apply to have land registered as an ACV?
Only a ‘community interest group’ can apply to their local authority to have land registered as an ACV. These groups can include a body designated as a neighbourhood forum, a parish council, an unincorporated body with at least 21 members, a charity, a company limited by guarantee, an industrial and provident society, community benefit societies or a community interest company.
How does a community interest group make an application?
A community interest group can apply to the local authority, nominating a piece of land and giving reasons why they believe it should be listed as an ACV. The local authority will then consider the application and will decide whether to include the land on its ACV list. If it does not, then the community interest group and landowner will be informed. If it does, then again the community interest group and landowner will be informed and the land will be placed on the list for 5 years. A restriction on the property title will be entered as well as a local land charge. The landowner does have a right to ask for the decision to be reviewed.
What if the landowner wants to sell?
When the landowner notifies the local authority of their intention to sell the ACV land, it will trigger a process. A 6 week period will begin in which before anything can happen, the nominating group or another community interest group can make known that they wish to be treated as a bidder. (If no intentions to bid are received then the landowner has an 18 month protected period from the date of notification in which to sell the land.) If a group decide that they do want to be treated as a bidder, the landowner has to wait 6 months from the date of notification to allow the community interest group to make an actual offer. The landowner does not have to accept the offer and the community group do not have to make a formal bid. After the 6 months, the landowner can chose who they wish to sell to (either the group or a private buyer) and they have 1 year after the 6 months to sell the land without any issue.
What happens if the landowner does not sell within that time?
The process restarts, and another 6 week period will begin.
What if the landowner sells the land without following the correct procedure?
If the landowner proceeds without following the correct procedure, the sale will be void and not recognised in law.