Contractual controls - what they are and what it means

In short, certain information about options, pre-emption rights and similar development agreements will need to be registered on a public register within set timeframes. The detail is still in draft and may change slightly before commencement, but no fundamental changes are expected.

What is a contractual control?

A contractual control is a private agreement that gives a party influence over whether, when or how land is sold or developed, without that party having a legal estate in the land. In practice, these arrangements allow a developer or promoter to secure the right to acquire or influence the development of land once pre-agreed conditions are met (for example, the grant of planning permission).

What agreements are likely to contain a contractual control?

The Regulations capture the main development-facing arrangements used in the market, including, options, pre-emption rights, conditional contracts for sale (for example, subject to planning), promotion agreements and hybrid promotion/option agreements.

In what circumstances would a contractual control be caught by the Regulations?

Based on the draft approach, an arrangement is likely to be caught where it relates to registered land and gives an undertaking the right to acquire a legal estate in land either by way of transfer or the grant of a lease of 15 years or more.

Are there any exemptions?

Targeted exemptions are anticipated which include:

Short-term arrangements of less than 18 months
Routine security interests and charges granted to lenders or to protect overage obligations to a former owner
Non-development arrangements
Rights over leases with 15 years or less remaining
Rights contained in s106 Agreements
Arrangements engaging national security or confidentiality in the public interest.

The precise scope of exemptions will be set out in the final version of the Regulations. Care will be needed with bespoke structures and complex joint ventures as the guidance which accompanies the Regulations confirms the exemptions will be interpreted narrowly.

What information must be registered?

While final data requirements may change, the intention is to capture core, non-pricing information to show who controls development opportunities. The obligation to register sits with the grantee, but it will also be expected to provide information about the grantor. The information required will be:

Identity of the parties and their contact details
Description of the land (including title numbers, site plan reference and local planning authority)
Details of the contractual control (option, pre-emption, conditional contract, promotion agreement, etc.) and the date and parties to the agreement
Key dates (grant date, long-stop/expiry) and whether the right is exclusive and/or assignable
High-level conditions precedent (for example, “subject to outline planning consent”)
Subsequent changes (assignments, variations, releases, termination).

Current policy signals suggest that detailed commercial terms (such as price, premium or overage percentages) are unlikely to be required.

When must it be registered?

The regulations are set to be in force from April 2027 and the registration regime is expected to set short, enforceable deadlines as follows:

New agreements: within 60 days of the agreement being entered into
Assignments: within 60 days of the assignment
Variations: within 60 days of the variation
Termination (either by release or effluxion of time): within 60 days of the termination.

The Regulations have set out transitional arrangements which means that from the date the Regulations are made (expected to be in the first half of 2026) any new contractual control arrangement which is entered into must be registered by 6 October 2027. From April 2028 it is anticipated that the Registrar will publish monthly datasets of the information it holds on the contractual control register.

Alongside significant sanctions for non-compliance, it will not be possible to register a notice or restriction protecting the contractual control without first demonstrating registration of the relevant control.

What should you do now?

For developers it is important to audit your pipeline to identify options, pre-emption rights, conditional contracts, promotion and collaboration agreements across your portfolio.
Map data to ensure you can extract parties, land descriptions, dates and key conditions quickly.
Build in information and cooperation clauses to development documents to support timely registration and updates. Ensure the relevant information is obtained from the grantor, before completion, to enable timely registration.
Plan workflows to allocate responsibility for filings and diarise renewal/variation/termination triggers.

VWV provides clear, practical guidance and if you have any questions about the information contained in this article, or would like tailored advice, please contact David Power.