The Community Right to Bid is a tool designed to help communities safeguard the property assets they value.
Once a property has been successfully nominated with us as an asset of community value (ACV), we add it to our list of such properties, and the Community Right to Bid is triggered if and when the owner wishes to dispose of the freehold or a leasehold of at least 25 years.
The owner who wants to sell an asset of community value must notify us of their intention to do so. We then inform the group that originally nominated the property as an ACV, and publicise the intended sale in the area where the property is located.
Community interest groups will then have six weeks to lodge with the owner (via the Council) a non-binding expression of interest, in which case a window of opportunity of a further four and half months (making six months in total) will come into effect to delay the sale. The full moratorium period exists to afford community interest groups sufficient time to prepare and raise money to bid for the property, potentially in competition with other interested parties.
Unlike the wider range of bodies that can nominate an asset for listing, any bid for the asset in the initial six week moratorium period can only be submitted by a community interest group – ie. a legally constituted organisation such as a charity, a company limited by guarantee that does not distribute profits amongst its members, a co-operative or community benefit society, a community interest company (CIC) or a parish council. During the moratorium period, the owner may market and pursue discussions about the sale with whomever they choose, but may not exchange contracts other than with a community interest group (this may be an incentive in certain circumstances).
However, it is important to understand that the Community Right to Bid does not confer a right of first refusal to a community interest group. At the end of the moratorium period, the owner is free to sell to whomever they wish, at the price they wish, and for a protected period of 18 months will not again be subject to a further moratorium.
There are a number of exemptions to the moratorium, when disposals are permitted to go ahead without triggering the Community Right to Bid. The most relevant are as follows:
- Gifts or disposals to family members
- Disposal of a business sold as a going concern
- Disposals where only part of the property is listed as an ACV
- Disposals in fulfilment of a planning obligation, option or pre-emption right made before the asset was listed
- Disposals under statutory compulsory purchase
- Disposals for the purpose of enabling NHS services to continue to be provided on the land
- Disposals held for the purposes of a school, a 16-19 academy or an institution within the further education sector.
(Note: the above list is a generalised summary only. The definitive list and description of exempt disposals can be found at section 95(5) of the Localism Act 2011 and schedule 3 to the Assets of Community Value Regulations 2012.)