Land Reform (Scotland) Bill: what has changed for the management of large landholdings?

With the Land Reform (Scotland) Bill now passed, the land management obligations for large landowners have been more clearly defined.

In 2024, we reported on the requirements proposed in the draft Bill, and it is now important to consider the changes introduced during the consultation process and review the obligations contained in the Bill.

What will landowners have to do?

As anticipated, the Bill imposes significant obligations on landowners of landholdings over 1000 hectares, most notably through the requirement to prepare a publicly available Land Management Plan (“LMP”).

The proposals discussed last year largely remain intact, but the Bill as passed provides greater clarity on the key requirements for landowners preparing their LMP.

In summary:

Mandatory community and tenant engagement: landowners must actively engage with communities and tenants (including crofters and small landholders) during the initial development of the LMP and when making significant changes to the plan. Importantly, landowners must evidence this engagement, detailing the impact it had on the development of the final LMP.
Transparency obligations: the LMP must disclose the extent and ownership of the land, and the owner’s objectives and long-term plans relating to the use and management of the land including any potential for future sale.
Statutory Compliance: the Landowner must explain how they comply or intend to comply with the obligations contained in the Bill and with the Scottish Outdoor Access Code, as set out in the Land Reform (Scotland) Act 2003 and the Code of Practice on Deer Management, contained within the Deer (Scotland) Act 1996.
Contribution to environmental and climate objectives: the LMP should outline how the landowner intends to manage the land in a manner that supports the Scottish Government’s net-zero target, adapts to climate change, and increases and sustains biodiversity.

Sale of large landholdings

The Bill introduces ministerial powers in relation to the sale of large landholdings. There is a notification requirement to the Scottish Ministers by any owner of a large landholding intending to sell.

Upon receiving such a notification, the Scottish Ministers reserve a right to determine whether it is in the public interest that the landholding be subdivided before sale.

Penalties for failure to comply

The penalties for failure to comply with the provisions of the Bill remain largely unchanged since we last reviewed it in 2024. The Bill, as passed, provides for enforcement by the Land and Communities Commissioner (“LCC”).

As noted previously, the LCC has the power to investigate breaches of LMP arrangements (i.e., failure to publish an LMP or failure to engage with the community) and can demand information from a landowner during their investigation. If a landowner fails to comply with a request for information, the LCC may impose a fine of up to £1,000.

Following their investigation, if the LCC determines that an obligation has been breached, they may offer the landowner an opportunity to agree on remedial action but failure to fulfil those actions may result in a fine of up to £40,000.

Who will be affected?

In 2024, the draft version of the Bill did not specifically indicate which categories of holdings these obligations would apply to.

In contrast, the Bill as passed sets out that a large landholding can comprise of two or more smaller holdings (if the holdings are over 1000 hectares in aggregate), which are within the ownership of one single landowner, or connected persons, and are within 250 metres of each other.

Though we await secondary legislation to provide for clearer definitions and timescales relating to LMPs, the impact of the passing of the Bill on owners of large landholdings cannot be denied.

It remains to be seen whether the Bill achieves the Scottish Government’s policy objective of creating a diversity of smaller landowners in Scotland.

If you have any questions about how the Bill as passed may affect you or your organisation, please get in touch with our market leading Rural team and we will be happy to help.

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