Community Right to Buy

The Community Right to Buy (CRtB) provisions under the Land Reform (Scotland) Act 2003 enable communities with a population of less than 10,000 (in rural Scotland) to register an interest in acquiring land, with the opportunity to have first option to buy that land when it comes up for sale.

You may have identified that your community needs recreational land on a piece of unused land or wants to build a new community centre or business units, or perhaps you can see the potential for the community to manage local woodland. Community Right to Buy is not just for land it also extends to any buildings (for example churches, disused schools and community centres), plus salmon fishing and mineral rights associated with the land already owned, being purchased or being registered under the CRtB.

If you have already got a community group set up and wish to register your interest in land or buildings the CRtB provisions would be a means of ensuring that the community is first in line to buy that land when it comes onto the market.

The Highland Council encourage groups to submit an initial ‘transfer request expression of interest’ so that they are aware of and can begin to understand your interest, can direct you to the appropriate support and provide you with a contact for accessing any relevant information that you may then need to inform completion of a full ‘application for asset transfer’. These forms can be found on the Highland Councils website under “Community Asset Transfer".

• No fewer than 20 members – the majority of whom should be from the local community (in very small communities where it may be prohibitive to have 20+ members, the Scottish Ministers may agree a smaller number if it is in the public interest)

• A clear definition of the community it serves (this is usually by postcode units)

• a clause that specifies surplus funds or assets of the company are to be applied for the benefit of the community.

Who can make an asset transfer request

Part 5 of the Community Empowerment (Scotland) Act 2015 allows a community transfer body (CtB) to make an asset transfer request to a relevant authority, with s77 providing a definition as to what can be considered a “community transfer body.

A CtB can be either a community controlled body (as defined in s19) or a body designated by the Scottish Ministers.

A community controlled body does not have to be incorporated, but it does have to have a written constitution.

If you want to buy a property through asset transfer however, you must be incorporated as a company, a SCIO or a BenCom (Community Benefit Society). 

If your request is for lease or other rights, the property remains in the ownership of the relevant authority, and they will want to be satisfied that your structure and governance is appropriate for the responsibilities you are seeking to taken on.

• They may require for you to be incorporated.

• Funders may also have particular requirements for their grants.

Whatever type of organization you choose for your group, to qualify as a community controlled body it must have certain provisions in its governing documents:

• a clear definition of the community to which the organisation relates (e.g. those who are resident in Highland, or those who are resident in a postcode unit)

• A provision that the majority of the members consist of members of that community

• A provision that the members have control of the organisation (i.e. there are more members who are also members of the community, than members who are not members of the community)

• A provision that membership is open any member of that community

• A statement of the organisations aims and purposes, including the promotion of a benefit for that community

• A provision that any surplus funds or assets are to be applied for the benefit of that community

A provision effectively stating

• “on the winding up of the company and after satisfaction of its liabilities, its property (including any land, and any rights in relation to land, acquired by it as a result of an asset transfer request) passes – (i) to another community transfer body, or (ii) to a charity.”

A provision that your organisation must have no fewer than 20 members (for a full asset transfer)

• In very small communities Scottish Ministers may agree a smaller number if it is in the public interest.

If you would like further guidance on qualifying as a community controlled body or how to form or amend your governing document, please get in touch.

Advantages of Community Right to Buy

• The opportunity of secure knowledge that the land cannot be sold to a third party for the duration of the registered interest

• It also grants ‘first refusal’ to buy land for community ownership, once it is made available for sale, without having to compete with other private bidders

• At the right to buy stage, Scottish Ministers will pay for an independent market value valuation of the land to be sold.

Disadvantages of Community Right to Buy

• The process requires registration prior to the land coming up for sale, though there is provision for “late” applications (where the land has been exposed for sale).

• Legislative deadlines and requirements to meet which must be met.

• Involves a willing seller, therefore it may be some time before the land (or eligible buildings) come on the market.

Communities of Interest

The legislation on asset transfers does not define what a "community" can be. It simply requires a community transfer body to define the community it relates to, and ensure the body is open to and controlled by members of that community, and uses its assets to benefit that community. Whether an organisation is eligible to make an asset transfer request depends on their governing document meeting the requirements, not on what community it represents.

A community can be any group of people who feel they have something in common. In many cases, it is that they live in the same area. However, it can also be that they share an interest or characteristic.

• Communities of interest could include faith groups, ethnic or cultural groups, people affected by a particular illness or disability, sports clubs, conservation groups, clan and heritage associations, etc. 

• They may be very specialised or local, ranging up to national or international groups with thousands of members.

Registering Interest

A community body wishing to register an interest under Community Right to Buy is required to complete a community right to buy application form.

In addition, the community body is required to demonstrate a level of community support alongside its application. 

Completed application forms, including maps, a petition showing community support and supporting documentation, should then be sent to CRTB@gov.scot 

After an application has been submitted to Scottish Ministers and passed initial checks to ensure compliance, they then forward it onto the landowner and any heritable creditor for their comments. At this stage, a temporary Prohibition will be placed on the landowner or creditor preventing them for taking steps to transfer or dispose of the land. This does not apply if the property was advertised for sale, or negotiations had started to transfer it to someone else, before the asset transfer request was made.

You are not required at this stage to set out detailed project proposals for the intended community use of the land, but it may help to set down some ideas on how you intend to utilise the land once purchased.

After the Prohibition has been enacted, the Scottish Ministers will then decide whether or not to approve the application. If the application is approved, the registration will remain over the land for five years with the chance to re-register that interest every five years on a rolling basis.

Right to Buy Process

The right to buy will only be activated when the landowner has indicated that the registered land is to be transferred, or when the provisions of the Act are breached.

If the right to buy is activated the Scottish Ministers will check that your group is still interested and you will have a period of 30 days to decide whether to proceed.

If the community body decides to proceed, the Scottish Ministers will take them through the right to buy process. As part of this process, ministers will appoint and pay for an independent valuer to determine the market value of the land. They will then appoint and pay for a ballotter to ballot the defined community. It is at this stage that additional evidence in support of your right to buy will be required. The results from the ballot will form part of the right to buy application, along with any evidence provided to support the proposal, such as a business plan or feasibility study.

Should ministers give consent to proceed with the right to buy, the community body will then have 8 months from the date they confirmed they wished to proceed (or longer if agreed between both parties) to conclude the transfer of the land.