Shropshire Council

Right to Bid FAQs

How does the Community Right to Bid work?

Local voluntary and community bodies can nominate an asset (a building or land) to be included on the List of Assets of Community Value, which we maintain. If the nominated asset meets the required criteria, it will be added to the list.

Then, when the owner of a listed asset wishes to dispose of the property, they must inform us. Some types of disposals are exempt from the scheme and the owner will be able to proceed with their disposal as planned. However, if the disposal is not exempt, we'll notify the community that the owner proposes to sell the property, and a six-week window of opportunity (called the “interim moratorium period”) will be triggered in which the owner cannot sell the asset.

If, during these six weeks, an eligible local community interest group informs us that they would like to be treated as a potential bidder for the asset, a longer moratorium period (up to six months) will be triggered. During this time, the owner cannot sell the asset, and eligible community organisations can use this period to prepare their bids to purchase the property.

However, the owner of the listed asset does not have to accept the community group’s offer, and when the moratorium period ends, the owner can sell the property to anyone of their choosing.

The following Q&A will provide greater detail on each step in the process.

What is the point of the Community Right to Bid?

The government acknowledges that every town, village or neighbourhood is home to buildings or amenities that play a vital role in local life.  They might include community centres, libraries, swimming pools, village shops, markets or pubs.  Local life would not be the same without them, and if they are closed or sold into private use, it can be a real loss to the community.  Over the past decade communities have been losing local amenities and buildings of great importance to them – the village or housing estate shop or pub or community centre or village hall.  The government cites that on average, nearly 300 pubs and 400 village shops have closed each year.

In many places across the country, when local amenities have been threatened with sale or closure, community groups have taken them over.  In some cases, however, community groups who have attempted to take assets over have faced significant challenges.  They often need more time to organise a bid and raise money than the private enterprises bidding against them.

The Community Right to Bid provision in the Localism Act 2011 was introduced particularly for this reason; to give a fair chance to local communities to prepare a bid to keep “assets of community value” in public use and part of local life.

What kinds of assets can (and can't) be nominated for inclusion on the list of Assets of Community Value?

A range of both public and private assets can be nominated, whether the asset is owned by a private company, an individual, Shropshire Council or another public body.  Assets can be buildings or land.  Assets to nominate might include an isolated village shop, a community centre, a children's centre, an allotment, a library, a swimming pool, a museum, or another asset that the community believes to have community value, as long as each asset meets all of the criteria for an “asset of community value” as set out in the Localism Act 2011.

However, as legislated in the Localism Act 2011, there are three types of assets that cannot be nominated for inclusion on the List of Assets of Community Value.  You can find the exact details of these exclusions in Schedule 3 of the Assets of Community Value (England) Regulations 2012, but as a summary, these are:

  • Residential properties – except where an asset which could otherwise be listed contains integral residential quarters, such as an accommodation as part of a pub
  • Land licensed for use as a residential caravan site (and some types of residential caravan site which do not need a license)
  • Operational land of statutory undertakers as defined in s263 of the Town and Country Planning Act 1990, for example, railways, roads, canals, airports, docks, etc.

How do you decide whether or not to list an asset?

When we receive a nomination form from an eligible community or voluntary body, it will evaluate the nomination according to the following criteria laid down in the legislation:

  1. Check that the body submitting the nomination is a valid body as prescribed in the legislation
  2. Check the land registry details to confirm the owner of the property
  3. Undertake consultation with the owner and occupier of the property, the local Shropshire Council member and town or parish council (unless they are the nominating body).
  4. Assess whether the nominated asset meets the requirements of Section 88 of the Localism Act

What are the criteria for deciding whether or not to list an asset?

Nominated land or property has to satisfy Section 88 of the Localism Act. There are two sub sections which provide the basis of assessment depending on whether the use of the land or property is current or has occurred in the recent past.

Section 88 (1): Does the ‘actual current use of the land, that is not an ancillary use, further the social wellbeing or social interest of the local community’ and is it ‘realistic to think that can continue to be a non-ancillary use, which will further (whether or not in the same way) the social well-being or interests of the local community’?

Section 88 (2): Did the ‘actual use of the building or other land that was not an ancillary use defined above occur in the recent past’ and is it ‘realistic to think that there is a time in the next five years when there could be non-ancillary use of the building or other land that would further (whether or not in the same way as before) the social wellbeing or interests of the local community’?

Whilst we can consider representations made by the owner and the relevant parish or town council and Shropshire Council member, ultimately the decision is based on whether the asset passes the two key tests above.

Do I get any say in deciding whether or not my asset is added to the list?

When we receive a nomination we'll notify you (in writing) that a nomination has been made for the asset that you own.  You will be given the opportunity to make written representations prior to any decision being taken. We have to make a decision within eight weeks of receipt so the period of time to respond is quite short. If we decide to include the asset on the List of Assets of Community Value, and you do not agree with this, you also have the right to request an internal review of our decision.  There are also provisions for a further appeal to the General Regulatory Chamber of the First Tier Tribunal, which is wholly independent of us, should you remain unsatisfied with the results of the internal review.

Who is considered the owner for the purposes of the scheme?

The definition of “owner” for the Community Right to Bid comes from section 107 of the Localism Act 2011:

(1)   In this chapter “owner”, in relation to land, is to be read as follows.

(2)   The owner of any land is the person in whom the freehold estate in the land is vested, but not if there is a qualifying leasehold estate in the land.

(3)   If there is just one qualifying leasehold estate in any land, the owner of the land is the person in whom that estate is vested.

(4)   If there are two or more qualifying leasehold estates in the same land, the owner of the land is the person in whom is vested the qualifying leasehold estate that is more or most distant (in terms of the number of intervening leasehold estates) from the freehold estate.

(5)   In this section “qualifying leasehold estate”, in relation to any land, means an estate by virtue of a lease of the land for a term which, when granted, had at least 25 years to run.

(6)   The appropriate authority may by order amend this section;

(a) for the purpose of changing the definition of “owner” for the time being given by this section;

(b) for the purpose of defining “owner” for the purposes of this chapter in a case where, for the time being, this section does not define that expression.

Who can appeal against the listing of an asset?

Only only the owner has a right to request a review of a decision to register an asset. There are no rights for other persons or bodies to have the decision to list or not to list, reviewed.

How can I appeal against my asset being included on the list?

If a nomination is successful, we'll notify the owner of the asset, the community group that made the nomination, and the occupier and other legal interests (if different from the owner) that the asset has been added to the List of Assets of Community Value.

As the owner, if you do not agree with this decision, you may request an internal review within eight weeks of being notified that the asset has been added to the list by writing to our Strategic Asset Management Team. We'll then complete an internal review within eight weeks of receiving your request. We'll inform both yourself and the group that nominated the asset of the results of the review.

If the result of the review is that the asset should remain on the list, but as the owner you do not agree with this result, you may appeal this decision by applying to the General Regulatory Chamber of the First-Tier Tribunal.  You are advised to seek legal advice in this regard.

How long will my asset remain on the list?

When an asset is added to the List of Assets of Community Value, it will remain on the list for five years. In some cases it may be removed earlier than five years, for example:

  • If an internal review or independent appeal judges that the asset has been wrongly listed
  • If a relevant disposal has taken place
  • If it becomes no longer of community value

Once the asset has been removed from the list, a community group can nominate it again to be included on the list.

What happens if you add my property to the list?

If a group’s nomination is accepted, and your asset is added to the list, we'll update the website to include your asset on the list, and notify yourself and the nominator in writing. However, nothing further will occur until you decide to enter into a relevant disposal of your listed asset.

What exactly is a 'relevant disposal' of my asset?

A relevant disposal is defined in section 96 of the Localism Act 2011 and is:

  • A disposal of the freehold estate in land is a relevant disposal of the land if it is a disposal with vacant possession
  • A grant or assignment of a qualifying leasehold estate in land is a relevant disposal of the land if it is a grant or assignment with vacant possession
  • If a relevant disposal within subsection (2) or (3) is made in pursuance of a binding agreement to make it, the disposal is entered into when the agreement becomes binding
  • Subject to subsection (4), a relevant disposal within subsection (2) or (3) is entered into when it takes place
  • In this section “qualifying leasehold estate”, in relation to any land, means an estate by virtue of a lease of the land for a term which, when granted, had at least 25 years to run

Could a small community group prevent me selling my property to whomever I want?

No community group can prevent you from selling your asset to the buyer of your choice, at any price agreed with the buyer.  However, in some circumstances you may have to wait up to 6 months before you can complete the transaction.

The Community Right to Bid allows eligible community groups to nominate your property to be included on the List of Assets of Community Value.  If their nomination is successful, (if it meets the criteria for “asset of community value” that is set out in the Localism Act 2011) we'll add your asset to the list.  If your asset is on the list, and you would like to dispose of it, you must notify us in writing.  We will then notify the community group that nominated the asset that you intend to sell the asset and advertise this locally and on our website and a six-week moratorium period starts, to give a community group the chance to register their interest in bidding with us.  If a group tells us they would like to bid then a six-month moratorium is triggered to allow them time to prepare their bid.  During this moratorium you cannot dispose of the asset.  However, at the end of the moratorium periods, you are completely free to dispose of your asset to whomever you want, at any price agreed between you and the buyer.  You do not have to accept the community group’s bid at any point.  Community groups do not have a right of first refusal.

What should I do when I wish to dispose of my property that is on the List of Assets of Community Value?

If the type of disposal you wish to enter into is not covered by one of the exemptions (see next question), you must notify us that you intend to dispose of your asset.  This is now enforceable under the Localism Act 2011 and any non-compliance will lead to your disposal becoming void.  To inform us of your intention to dispose of the asset, please write to or email our strategic asset manager: steve.law@shropshire.gov.uk

When you notify us of your intention to dispose of the asset, a six-week interim moratorium period will be triggered in which you cannot sell the asset.  During this time, eligible community interest groups can request to be treated as a potential bidder for that asset.  If they do not make this request, you will be free to sell your property when the six weeks have passed.

However, if a request is made, a longer moratorium period will be triggered in which you cannot sell the asset, and in which community groups can prepare their bids to purchase the property. This period lasts for six months from the date you notified us that you intend to sell your property.

When this period ends you will be free to sell to anyone of your choosing – you do not have to accept the community group’s bid.  You will then be covered by a 12-month “protected period” in which you can sell your asset without being subject to any further moratorium periods.  Please note if you neglect to notify us of your intention to dispose of the asset, or if you claim that your disposal is exempt even though it is not, enforcement and non-compliance policies are in place that will lead your disposal to become void and ineffective.

Owners considering a disposal of an Asset of Community Value are recommended to seek legal advice with regard to this aspect of the legislation.

Who can trigger the full moratorium?

(a) A parish council, if any of the land is in its area; or

(b) A community interest group in relation to any land if the body—(i) is within one or more of sub-paragraphs (c) to (f) of regulation 5(1)(below); and (ii) has a local connection with the land.

(c) A charity

(d) A company limited by guarantee that is non profit distributing

(e) An industrial and provident society that is non-profit distributing (these groups will be renamed as community benefit societies by the 16 co-operative and community benefit societies and Credit Unions Act 2010 when the relevant provisions come into force)

(f) a community interest company*   

(*) A community interest company is one which satisfies the requirements of part 2 of the Companies (Audit, Investigations and Community Enterprise Act. See in particular sections 26, 35 and 36A. There have been amendments to section 26 and a substitution of section 36A which are not significant to these regulations.

Which types of disposals are exempt from the moratorium periods?

Usually, when the owner of a listed property wishes to sell the property, they must notify us of their intention, and as described above, we then trigger a six-week moratorium period and provide the community with this information.  However, in some cases (24 specific situations listed in the legislation), this process does not apply. 

In these cases the owner may proceed with their disposal without telling us, the community is not notified of the owner’s intention to sell, and no moratorium periods are triggered.

Owners considering a disposal of an Asset of Community Value are recommended to seek legal advice with regard to this aspect of the legislation

For full details of these exemptions, please see Section 95(5) of the Localism Act and Schedule 3 of the Regulations.  If you are sure that the type of disposal you plan to enter into is covered by one of these exemptions, you do not have to inform us of your intention to dispose, and no moratorium periods will be triggered.  However, it is very important that you understand the detailed legislation around exemptions, and are confident that the disposal is exempt before you continue.  If it is not exempt, and you proceed with the disposal, your disposal will be considered void and ineffective due to the enforcement and compliance provisions in the Localism Act 2011 (see next question).

Owners considering a disposal of an Asset of Community Value are recommended to seek legal advice with regard to this aspect of the legislation.

What happens if I sell my property during the moratorium period?

Because the asset has been added to the List of Assets of Community Value, a restriction will be placed on its entry in the Land Register, in the form of the following wording:  “No transfer or lease is to be registered without a certificate signed by a conveyancer that the transfer or lease did not contravene section 95(1) of the Localism Act 2011”.  This restriction will ensure that any future disposal of the asset will take place in accordance with the rules of the scheme.  This means that any sale of your property that contravenes the relevant Localism Act 2011 provisions for the moratorium periods would be considered ineffective.

Owners considering a disposal of an Asset of Community Value are recommended to seek legal advice with regard to this aspect of the legislation

How often can these moratorium periods be triggered?

Moratorium periods cannot be triggered in continuation, because of the protected period. This period lasts for a total of 18 months from the date you notify us that you wish to enter into a relevant disposal of the asset.  If you do not sell your asset at the end of the interim or full moratorium periods there will be the remainder of the protected period (eg 12 months) in which you are permitted to sell without triggering another delay.  So, if you do not manage to sell the asset after complying with the rules of the scheme, you would be free over the next 12 months to dispose of your asset without triggering another cycle of interim and moratorium periods.

What if the value of my property goes down during the six months that I must wait before selling my asset?

The government realises that, in order to achieve a significant community benefit, the Community Right to Bid provisions have an impact on the rights of private property owners. Because of this there is a compensation scheme in place that enables private property owners to claim for costs or loss incurred as a direct result of complying with the Community Right to Bid procedures.

What if I don’t want to sell my asset to a community group that makes an offer, even if they make the highest bid?

You do not have to accept the community group’s offer, no matter how high their bid.  The Community Right to Bid provisions do not restrict in any way who the owner of a listed asset can sell his or her property to or at what price, and they do not confer a right of first refusal to community interest groups.

Where can I read more about the Community Right to Bid and the List of Assets of Community Value?

You can view the full text of the Community Right to Bid chapter in the Localism Act 2011 (Part 5 Chapter 3) and the Assets of Community Value (England) Regulations 2012, can be viewed here:

View our up-to-date List of Assets of Community Value.