This note briefly discusses the 'community right to bid' for ‘assets of community value’, introduced by the Localism Act 2011. Councils must maintain a list of ‘community assets’, nominated by community groups. If the asset is sold, the group will be given time to come up with a bid. The note discusses the workings of the scheme and related options with regard to community land and buildings.Jump to full report >>
Part 5 Chapter 3 of the Localism Act 2011 provides for a scheme called ‘assets of community value’. This requires district and unitary councils to maintain a list of ‘community assets’. It has also become known as the ‘community right to bid’.
Community assets can be nominated by parish councils or by groups with a connection with the community. Individuals cannot nominate community assets. If the nomination is accepted, local groups will be given time to come up with a bid for the asset when it is sold.
The right to bid only applies when an asset’s owner decides to dispose of it. There is no compulsion on the owner to sell it. The scheme does not give first refusal to the community group, unlike the equivalent scheme in Scotland. It is not a community right to buy the asset, just to bid. This means that the local community bid may not be the successful one.
Certain types of land, most notably residential property, are exempt from being placed on the register. Owners of property placed on the register may appeal against its listing and can claim compensation if they can demonstrate its value has been reduced. Also, certain types of transfer of land or assets do not count as ‘disposals’ for the purposes of the legislation.
The community right to bid extends to England; the Welsh Government has not yet commenced it with regard to Wales. It is separate from the community right to reclaim land and community asset transfer, which are also addressed within this note.