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Pub: everything you need to know about assets of community value

Simon Chaplin, Head of Pubs & Restaurants - London, explains what you need to know about assets of community value (ACVs) if you're a pub owner.

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A concept intended to empower local communities by enabling them to take ownership of the assets within them,  ACVs are in theory a good idea. However, if you’re a pub owner and your pub has been listed as an ACV (or there is an attempt to list it), there are some things you should know.

Firstly, as the owner, you will have the right to comment on a nomination made to the Council to list your pub as an ACV, as well as request the nomination documents. It is possible that the argument and information put forward by the local community is inaccurate, and you may be able to challenge this.

If the nomination is successful and the Council decides to list the pub, its ACV status will last for five years, after which the community will have to go through the nomination process again. This will affect you if you intend to sell or apply for planning permission (and in some cases, finance) within this time. Effectively, the ACV acts as a block if the use of the property looks to be threatened in any way.

If you do intend to sell it is also worth noting that the local community will not be given the right to submit a bid if it is to be sold as a trading pub for continued use as a pub – in this case, there are no rights under the ACV.  If you plan to sell and close the business then you need to notify the local authority as soon as possible, after which it goes to an interim moratorium period of six weeks where the community is able to express interest in buying the pub. If the community expresses interest, this will then put the sale of the pub on hold for six months unless the community puts in an offer and it is accepted within this timeframe.

Challenges to an ACV listing can take many forms. It is best to challenge a nomination as soon as it is made, but you can still ask the Council to review its decision within three months. Mark Brown of law firm Freeths has a 69% record of success in this area having objected to over 60 nominations when acting for owners – so it is possible!

If the Council upholds its decision at review stage, then an appeal can be made to the First Tier Tribunal. The First Tier Tribunal can reverse the Council’s decision to list if there is a good reason for doing so.

After the six month period triggered by the community’s expression of interest in purchasing the property is up, if no offer is made and it appears to have been effectively used to delay any potential sale, the owner of the land can claim compensation for loss or expense incurred during this time, such as holding costs or increased professional costs. It may also be possible to make a claim for the difference in the value of the pub (should this have decreased) after the six month period is over.

Owners should be open and honest with the community about their plans from the start. If the ACV listing will have an adverse impact on the owner and the business then he or she should communicate this, because that may not be the impact that they want to have. If their intention is to try and retain the pub as a pub, then there may be other ways for them to achieve their objective.

Local authorities are also starting to reject ACV applications backed by CAMRA when they appear purely politically motivated, as in when there seems to be no real reason to list the pub. There has been wide publicity around this which builds on the scepticism and wariness of pub owners and others in the industry too. But not all cases end badly.

Lastly, seeking professional advice is the best thing to do to ensure the best outcome for you and your pub.

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