HM Land Registry: Contractual control rights scenarios
Guidance on how the new rules for reporting contractual control rights may apply to commonly encountered types of contractual rights.
Applies to England and Wales
For information about providing information to HM Land Registry about contractual control rights obligations under the Provision of Information (Contractual Control) (Registered Land) Regulations 2026 see our practice guide 84: contractual control rights.
Providing information to HM Land Registry about Contractual Control Rights
Example scenarios
The purpose of this guidance is to explain HM Land Registry’s current understanding of how the Provision of Information (Contractual Control) (Registered Land) Regulations 2026 (‘the Regulations’) apply in a range of common scenarios and to assist grantees and their advisers in deciding when information must be provided.
This guidance does not modify or override the text and meaning of the Regulations and HM Land Registry is not ultimately responsible for determining or interpreting how the Regulations apply to individual cases. However, we will review and update this guidance from time to time, adding to the scenarios outlined where appropriate and taking into account feedback from customers, operational developments and any judicial clarification in relation to the Regulations.
Where information must be provided under the Regulations, it will be an offence under section 225(1) of the Levelling-up and Regeneration Act 2023 to fail to provide the information without reasonable excuse. If you follow the guidance provided here and in practice guide 84: contractual control rights and, on that basis, reasonably conclude that information is not required in a particular scenario, you may consider that this should amount to a reasonable excuse to explain your conclusion.
1. A contract with a person who is not (or not yet) the registered owner
A developer (A) has a contractual right to buy registered land from the owner subject to obtaining suitable planning permission. Before buying the land, A enters into a conditional contract to sell part of the land to B (a housing association).
B’s right to buy the land from A will not be a contractual control right at the time it is granted because at that time, A is not the registered proprietor of the land (nor entitled to be registered as the proprietor). Even if the right meets all other criteria for being a contractual control right, contractual control information will not have to be provided to HMLR about the right unless:
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B applies for a notice or a restriction to protect their right. In that case the right is treated as a contractual control right (see Regulation 5(1)(b)).
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After A buys the land:
- A and B agree in writing to vary the right (see Regulation 4(3)(c)); or
- B assigns the right to C (see Regulation 4(3)(b).
If the right is assigned or varied after A has bought the land, contractual control information will have to be provided at that time, unless due to changed circumstances the right no longer meets all the criteria for being a contractual control right.
2. A right not held for the purpose of ‘an undertaking’
John, a private individual, has an option to buy a plot of registered land from the owner on which he intends to build a house for himself and his family to live in.
John’s option to buy the land from the owner will not be a contractual control right at the time it is granted, even if it has all the other characteristics of such a right, because John has not acquired the option ‘for the purposes of an undertaking’. To fall within the scope of the Regulations a contractual control right must be a ‘relevant contractual right’ within the meaning of section 221, Levelling-up and Regeneration Act 2023. Section 221(4) provides more detail about the meaning of an ‘undertaking’.
If John later decides not to buy the land, but instead assigns the option to his friend Sarah, a builder, so she can build and sell the house on, the right will then be held for the purposes of an undertaking (Sarah’s business). She will have to provide contractual control information following the assignment if the right meets all other criteria for being a contractual control right (see Regulation 4(3)(b)).
3. A short term lease with an option to take a further lease
The trustees of a charitable trust have an option to take a lease for a term of 12 years from a registered proprietor. The agreed form of lease includes an option for the trustees to take another 12-year lease when the original lease term expires.
The trustees’ option to take a lease for a term of 12 years will not be a contractual control right because the lease would be for a term of less than 15 years. To meet the criteria for a contractual control right, the lease would need to be for a term of at least 15 years (see the definition of a “relevant disposition” in Regulation 2).
The option to take a further lease does not change this. The relevant consideration is the term of the lease to which the option relates, rather than the combined terms of two or more possible leases.
4. Multiple rights contained in a single contract
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Under a development agreement, a developer is granted rights to acquire three registered properties from three different landowners.
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Under a joint venture agreement, the parties grant each other reciprocal rights to acquire (or direct a sale) of each other’s properties in specific circumstances.
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A contract granted to a developer that is conditional on the grant of planning permission to build a set number of houses includes an alternative option for the developer to acquire the land at a reduced price if planning permission is only granted to build a reduced number of houses.
A single contract may create several separate rights. The Regulations apply to contractual control rights individually rather than to the whole of a contract containing those rights. Therefore, you need to consider each right separately to determine if that right meets the criteria for a contractual control right. If more than one of those rights meets the criteria for a contractual control right, contractual control information will have to be provided about each right that does so.
5. A right that can only last for less than 18 months
A developer, has an option for a period of 12 months to take a transfer of freehold registered land from the registered proprietor. The 12-month period can be extended by the developer for a further 12 months if planning permission for the proposed housing development has not been granted within the initial 12-month period.
As it is possible that the right of pre-emption right could be extended to a period of up to 24 months, the exemption in the Regulations relating to rights that are short term (that is, for less than 18 months) will not apply, and the right may be a contractual control right.
A right that can only last for a period of less than 18 months (after taking account of any provision to extend the initial period) will not be a contractual control right (see the definition of “total period of control” in Regulation 2).
6. An option to purchase land as an investment
A land investment company takes a 15 year option to purchase a large area of registered land. The land is currently zoned as part of the green belt and is therefore unlikely to be granted permission for housing development in the immediate future, though that may change during the option period. There are no preconditions that must be met before the company can exercise the option and no restriction on its ability to assign the option. The company speculates either that the land will increase in value sufficiently to justify it purchasing the land, or that the prospect of its value increasing will be sufficient for the company to assign the option to a third party at a profit.
Under the Regulations, a right that is held exclusively for a purpose that does not relate to housing development or development that creates a building where the floorspace created by the development is 100 square metres or more will be an exempt contractual right (see paragraph 3 of the Schedule to the Regulations).
In this scenario, the company’s purpose in acquiring the option is as an investment which can be exercised or assigned to realise a profit. Although the company will not be particularly concerned as to the cause of the value of the land increasing, as the possibility of future development may be directly relevant to that happening, the option may not fall within the exemption referred to above. The position might be different if the company could demonstrate that it acquired the option exclusively for a defined purpose that was in no way related to development.
7. A ‘golden brick’ contract
After becoming registered as owner of a freehold development site, the developer enters into a contract with a registered social landlord (RSL), for the sale and continued development of social housing units on the land. The RSL must take a transfer of the land once the housing units have been constructed to the level of two brick courses above damp course level (often referred to as a ‘golden brick’ contract).
In this case the RSL does not intend to develop the land itself. Its ultimate purpose relates to use of the developed units rather than to the development itself. However, as that use depends on development that will occur after the date of the contract, the ‘not for development’ exemption in paragraph 3 of the Schedule to the Regulations would not apply.
If the right meets all other criteria for being a contractual control right, the RSL may be responsible for the provision of contractual control information to HMLR about the right.
8. A section 106 agreement to provide affordable housing
A local planning authority enters into an agreement with a landowner of a registered freehold plot of land under section 106 of the Town and Country Planning Act 1990. The section 106 agreement is a condition for the grant of planning permission to build a block of six flats on the land. Under the agreement, the six flats are to be used as affordable housing and are to be transferred to a housing association nominated by the local planning authority.
A right contained in a section 106 agreement with a local planning authority will be exempt from constituting a contractual control right if the right relates exclusively to the provision of infrastructure, amenities or services in connection with a grant of planning permission (see paragraph 5 of the Schedule to the Regulations).
In this instance, as the local planning authority’s right to direct a transfer of the six flats to a housing association relates to the use of the property as affordable housing, rather than to the provision of infrastructure, amenities or services, the exemption referred to above will not apply.
9. A right granted after 8 June 2026 but before 6 April 2027
A retail company enters into a contract with a landowner in July 2026 which gives the company a right of pre-emption if the landowner wants to sell or grant a long lease of the land during the following 2 years. The company is considering the land as the site for building a new warehouse. In January 2027 the company and the landowner agree to increase the pre-emption period to a total of 4 years from the date of the initial grant.
Even though the right was granted before the Regulations came into force, as the grant was made after 8 June 2026, the company may still have to provide information about the right to HM Land Registry on or after 6 April 2027, when HM Land Registry’s new service is made available.
The company will not be able to provide contractual control information to HM Land Registry before 6 April 2027. It may apply to protect its right in the register by way of a notice and/or a restriction before that date in the usual way.
After 6 April 2027, the company will have until 6 October 2027 to provide the required information, although it may have to provide the information sooner if it applies for a notice or restriction to protect the right between 6 April and 6 October.
The contractual control information provided about the company’s right would need to be accurate at the date the information is provided. In this case the information would need to record the length of the pre-emption right taking account of the variation to the right that took place in January 2027.