The Land Reform (Scotland) Bill as passed – Key Points

The much-anticipated Land Reform (Scotland) Bill was passed by the Scottish Parliament on 17 March 2016. We last commented on the content of proposed Bill at the time of publication in July last year and whilst not all initial proposals have survived committee and subsequent parliamentary scrutiny, the Bill (as passed) does provide some key changes to land ownership in Scotland.

1. Agricultural tenancies: The largest part of the Act deals with tenant farming and provides for the:-

a. creation of a new type of tenancy known as a Modern Limited Duration Tenancy (“MLDT”) which is a tenancy for a minimum of 10 years (although there can be a tenant break at year 5 where the tenant is a new entrant), and provision for the conversion of some existing tenancies into MLDTs;

b. creation of repairing tenancies which are to be for 35 years or more and which require the tenant to improve the land to bring it to a state capable of being farmed (within 5 years or more depending on the provisions of the lease) and which specifically provide they are to be repairing tenancies;

c. removal of the requirement for tenants to register to have a right to buy under leases created pursuant to the Agricultural Holdings (Scotland) Act 1991(the “1991 Act”);

d. amendment of 1991 Act leases in respect of rent review provisions and to accommodate the new types of tenancy;

e. widening of the class of people to whom 1991 Act leases and Limited Duration Tenancies can be assigned and who can succeed to a farming interest, while the already limited grounds for objection are also reduced;

f. ability of a 1991 Act tenant to relinquish their tenancy in exchange for compensation payments and for assignation in the event that the offer is not accepted;

g. provision of compensation for tenant improvements;

h. procedure for diversification applications and reference of disputes to the Land Court;

i. extension of the two months’ notice period for irritancy on non-payment of rent by a further two months;

j. obligation on the Scottish Ministers to review the legislation governing small holdings and lay a report to the Scottish Parliament by 31 March 2017.

2. Land rights and responsibilities: The Scottish Ministers are to prepare and publish a land rights and responsibilities statement after consultation and review every 5 years.

3. Establishment of the Scottish Land Commission: The remit of its Commissioners covers the following for any matter relating to land in Scotland:

a. Review of impact and effectiveness of law and policy;

b. Recommend changes in law and policy;

c. Gather evidence and research;

d. Prepare reports, information and guidance;

e. Work with other Commissioners where their functions relate to agriculture and agricultural holdings*;

f. Prepare codes of practice for agricultural holdings and promote their observance.

g. Deal with alleged breaches of the code of practice*;

h. Prepare reports on the operation of agents of landlords and tenants of agricultural holdings*;

i. Prepare a list of recommendations for a modern list of improvements to agricultural holdings*;

j. Refer to the Land Court any question of law relating to agricultural holdings*.

*matters for the sole Tenant Farmer Commissioner rather than the four main commissioners.

4. Information on the control of land: The Scottish Ministers must make regulations requiring information to be provided about persons who have a controlling interest in owners and tenants of land and that information is to be held in a public register kept by the Keeper of the Registers of Scotland.

5. Community engagement: The Scottish Ministers must issue guidance about engaging communities on decisions relating to land which may affect communities.

6. The right to buy land for sustainable development: The Bill also introduces a new register of applications by the community to buy land.

7. Shooting and deer forests: These will no longer benefit from an exclusion from the valuation roll.

8. Deer management plans: Scottish National Heritage will have powers to require certain land owners and occupiers to prepare a deer management plan. There are other changes to the Deer (Scotland) Act 1996 to increase the level of fines for non-compliance.

9. Core paths: circumstances where core paths plans can be reviewed are inserted into the Land Reform (Scotland) Act 2003. These are where the access authority considers it appropriate or where the Scottish Ministers require this. There is also provision for the amendment of core path plans.

The Bill has been seen as some as a missed opportunity and what is clear is that it is not the sea-change it was initially heralded as. From the introduction of the Bill, the headline-grabbing proposals imposing restrictions on the extent of private land held by one landowner and non-EU corporates never made it into the draft. However, others view the Bill as a step in the right direction and more robust land reform legislation may be forthcoming in the not too distant future.

Statutory instruments are required to give effect to much of the Bill and the timetable for Royal Assent is still to be set. It is expected that the Bill will be enacted before the end of the current parliamentary session.

The full text of the Bill can be found here.

For more information, please contact Rebecca McGladrigan (+44(0)131 200 7697) or Lindsey Wainwright (+44(0)141 304 6262).