Proposed register of persons holding a controlled interest in land in Scotland

In September of last year, the First Minister announced the Scottish Government’s intention to continue its programme of land reform and to prioritise transparency, accountability and community ownership. As part of this, it has now published draft Regulations to implement provisions of the Land Reform (Scotland) Act 2016 to establish a public register of people who own and manage land in Scotland. If the Regulations are approved, the register, to be called the Register of Persons Holding a Controlled Interest in Land, will reveal for the first time, the controlling interests behind ownership of land in Scotland.

The draft regulations will apply to owners of land and tenants of registered leases (of a duration of more than 20 years). They will identify the controlling person, where it is not apparent from other public registers, for example, where the owner of land is an overseas company or where land is held in a trust arrangement. The proposed register will contain an entry for each person who controls or influences owners and tenants of land in Scotland.

According to the Roseanna Cunningham, Land Reform Secretary, this will create a potential for people in communities to be able to engage directly with those parties, which the Scottish Government believes will lead to better decisions about how Scotland’s land is used. As the Government wishes the information to be as accessible as possible, the Register will be free to access.

The Scottish Government remains a step ahead on increased transparency, with UK legislation expected to follow with a draft bill expected to be published over the summer, with a view to establishing a Register of Overseas Entities’ Beneficial Owners by 2021. The UK register will apply to overseas companies who own land in the UK and will also apply to overseas companies who bid for Central Government Procurement Contracts. To avoid duplication, the Scottish Government has noted that it will consider the UK’s proposals and, should they be suitable, the final regulations may take them into account.

It remains to be seen whether, when implemented, such a register will assist in management and control of land in Scotland or whether it may make Scotland a less attractive location for overseas registered entities to own property.

The Scottish Government has opened a consultation on the draft proposed regulations which can be accessed here. The consultation closes on 8th November 2018. All parties who currently own property registered in Scotland whether via an overseas registered company or a trust should be aware that the controlling interest will become public information once the regulations come into force.

This article was co-written by Emily Wallace.

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