As we enter the New Year, many people may have set themselves resolutions for how they want to better themselves in the months to follow. Although some resolutions can be short lived, if you are affected and have not yet taken steps to register, your top resolution for 2024 should be to complete your registration in the Register of Persons Holding a Controlled Interest in Land (“RCI”).
On 1 April 2022, following The Land Reform (Scotland) Act 2016 (Register of Persons Holding a Controlled Interest in Land) Regulations 2021 (“the 2021 Regulations”), the RCI came into effect. The main purpose of the RCI is to make information on who can influence decisions concerning land or property, public. There will be an entry in the RCI for each controlled person (i.e. each owner or tenant) known as the ‘Recorded Person’ and for each person who is in the position to influence them, known as the ‘Associate’.
Although there was an initial grace period of one year to complete registration in the RCI, this was extended by a further year as a result of a lack of registrations, seen as being worsened by Covid. This extended grace period ends on 31 March 2024 and there is currently no plan for the grace period to be extended? again.
Who does the RCI affect?
Any occasion where someone exercises control or influences land, including how it might be used, sold or leased, but they are not a recorded or registered owner or tenant, may require registration in the RCI. Although this is by no means exhaustive, common examples of circumstances where registration in the RCI might be required include:
- Where land or property is listed on Partnership Accounts but the title is held in the name of a partner as an individual.
- Where the title to land is in the name of a Partnership and either the Partners are not individually listed, or a new Partner has been assumed since the title was recorded or registered.
- Where the title is held in the name of a Trust and either the current Trustees are not individually listed, or new Trustees have been assumed since the title was recorded or registered.
- Where land is owned by an unincorporated association, such as a club or society, and the office bearers are not listed on the title, or have changed since the title was recorded or registered.
- Where the land is owned and/or controlled by certain overseas entities.
In the event of the land or property being owned by an entity which is subject to another transparency scheme, they are not required to register in the RCI, although they may still have to register as an associate. This includes UK companies, Limited Liability Partnerships and certain types of charities.
The onus is on the Recorded Person to complete the registration process and verify the details of all Associates.
What happens if you fail to register by 31 March 2024?
Any Recorded Person or Associate who fails to comply with their duties in terms of the 2021 Regulations, commits a criminal offence. As well as the requirement to register, there are also duties to keep the RCI updated, for the Recorded Person to notify the Associate of the registration, and for the Associate to provide information on request. Where an offence is committed, it is punishable by a fine of up to £5,000.
If you think you might be required to register in the RCI and have not yet taken steps to do so, you should act now to avoid committing an offence once the grace period ends on 31 March 2024.
You can complete registration yourself or contact a member of the Land and Rural Business team who can assist with the registration process. Please also get in touch if you are uncertain whether you need to register as the Land and Rural Business team can also review your circumstances to advise what action, if any, might be required. Contact the specialist Land & Rural Business team on 03330 430350.