Conservation covenants: green shoots or withered vines?

Part 7 of the Environment Act 2021 introduces a new type of local land charge called a "conservation covenant". Tobias Shaw Paul and Trevor Ivory summarise how they work, the operation of similar systems in Scotland and France and how effective they are likely to prove in practice in light of previous experience in these other jurisdictions.

Open spaces, historic buildings and natural habitats are valuable social assets, but when faced with the need to deliver new housing, commercial development and infrastructure, the question arises as to how we ensure that these assets are protected and enhanced – especially fragile natural ecology and biodiversity.

In recent years there has been increasing interest in allowing landowners to create binding positive obligations over land for the purpose of conservation and for the benefit of the public, similar to 'conservation easements' in the USA. The existing law (and the work-arounds used to overcome it) was cumbersome and unwieldy so, after significant work by the Law Commission, Part 7 of the Environment Act 2021 has introduced a new concept – the "conservation covenant" – which seeks to provide a solution.

A conservation covenant is an agreement to do (or not do) something on land for a conservation purpose - such as conserving the natural environment or places of architectural or historic interest - made between a landowner (with a freehold or leasehold of over seven years) and an organisation which has been designated as a "responsible body" under the Act. For example, an agreement to allow public access or to refrain from using pesticides on native vegetation. Unlike a section 106 planning obligation, it is not possible to create a conservation covenant unilaterally.

Whilst any organisation with a focus on conservation can apply for designation, these are likely to be mainly public or charitable bodies whose functions relate to conservation, such as Natural England, the National Trust and local authorities. The responsible body enforces the landowner’s obligations and need not itself own land nearby. Enforcement proceedings include applying to court for an injunction or for damages, including potential exemplary damages if the landowner is in breach.

The covenants are intended to be long-lasting and – once registered as local land charges – are capable of binding subsequent landowners and lessees, ensuring that the land's conservation value is protected. Unless the agreement provides otherwise, the covenants remain until the end of the lease or indefinitely over freeholds.

Covenants can be discharged or modified, either by agreement or by applying to the Upper Tribunal.

There are a number of issues with the new conservation covenants. There is no systematical oversight of their content or enforcement and responsible bodies are not required to work together to co-ordinate activities, which could undermine their effectiveness where large-scale conservation across multiple landownerships is needed to achieve the underlying environmental aims.

As well as in the USA, Scotland and France have similar provisions in place although uptake of these has been low.

Conservation covenants are largely based on the 'conservation burdens' and 'climate change burdens' (introduced in 2003 and 2009 respectively) which operate in Scotland in a similar manner - they are created by agreement between the landowner and the 'conservation body' and registered against the landowner's title.

Conservation burdens have been used rarely. [1] The majority relate to 'cultural' rather than 'natural' heritage. Of the roughly 600 burdens registered since 2004, over 300 were held by Historic Scotland and related to grant funding for works to listed buildings, being of only short duration.

No climate change burden has ever been registered. [2]

The French system was introduced in 2016. Obligations are set out in a contract between the landowner and either a public body or an entity involved in nature conservation. The contract is registered in the French land register and will bind future owners for as long as the contract remains in force. At the discretion of the governing municipality, an obligation can also give rise to property tax exemption, but this is limited to agricultural land and practice in granting the exemption is not consistent. Fewer than ten obligations have been completed of which only one involved a private landowner and adoption of this system has met a great deal of resistance. [3]

This is hardly surprising. Landowners generally desire flexibility to use land as they wish and to reduce the number of encumbrances which might depress its value. Even where land is proposed for development, the new covenants offer little advantage over the existing system of planning obligations.

Conversely, conservation easements are widely used in the USA, which reflects the comparative absence of direct regulatory controls on land use that exist in these jurisdictions and the generous tax reliefs (which treat granting a perpetual easement as a charitable donation) which are available. The USA also has far greater cultural and political acceptance of private involvement in environmental protection and enhancement.

The trends seen elsewhere with similar mechanisms to the new regime indicate that, without concerted political effort and sustained public support, conservation covenants may well simply wither on the vine. At the current time they seem to offer little benefit over more traditional planning obligations to secure environmental enhancements necessitated by development.

Trevor Ivory is a partner and Tobias Shaw Paul is an associate at DLA Piper.

[1] Reid, C. T. (2014). Conservation Burdens and Covenants. Scottish Planning and Environmental Law, 1 (165), 109

[2] Steven, A. J. M. (2020). Real Burdens in Scots Law: An Environmental Perspective. Contract and Property with an Environmental Perspective, Demeyere and Sagaert (eds.) (Intersentia), 143

[3] Martin, G. (2021). Les obligations réelles environnementales au service d’une protection des zones humides. Les Cahiers de droit, vol. 62, n. 4 (Dec 2021), 1091

See also:

Biodiversity net gain and the Environment Act 2021: Amy Truman and Henry Jeffreys examine the elements of the Environment Act 2021 which secure the provision of biodiversity net gain.

Measuring Biodiversity Net Gain: In the second article, Marc Sorrentino and Trevor Ivory consider the issue of metrics.

Biodiversity Net Gain and off-site provision: Ian Graves and Trevor Ivory consider off-site fulfilment of obligations.