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3. CROFTING REGISTER

3.1 Background

3.1.1 The Crofters Commission has a duty under current legislation to compile and maintain a Register of Crofts. During its inquiry, the Committee considered the completeness and accuracy of the Register of Crofts. The Committee heard evidence from the Crofters Commission and other Stakeholders and found that the Register of Crofts had never been up to date. In its evidence, the Crofters Commission stated that it had neither the resources nor the powers to compel people to provide the information needed to bring the register up to date. In order to remedy this, the ColoC recommended a separation of the functions of the Crofters Commission, with responsibility for the maintenance of the crofting register being transferred to the Keeper of the Registers of Scotland, referred to hereafter as the Registers of Scotland. The CoIoC also proposed that boundaries of crofts that had been accepted for twenty years should not be challengeable.

3.1.2 The Government agreed in its response that responsibility for establishing a definitive new Register of Crofts should be entrusted to the Registers of Scotland. The Registers of Scotland welcomed the proposal, recognising the synergies between the Register of Crofts and the property registers they are currently responsible for maintaining. Rather than transferring the existing register, it was considered that a new Register of Crofts was required that would provide legal certainty on the extent of, and interests in, a croft. It would be similar to the current Land Register and would be open to public inspection. The Registers of Scotland would charge a fee in accordance with a standard fee schedule to make an entry on the new Register of Crofts. The Government's response also indicated that consideration would be given as to whether or not a fee for inspection of the new register should apply.

3.1.3 Legislation will be required in order to establish a new croft register and to confer associated functions on the Registers of Scotland. The Government response indicated that the legislation would require a croft to be recorded in the new register when a defined regulatory decision is to be taken in relation to that croft. Further consideration was to be given to the type of transaction that would trigger the recording of a first registration. The speed of establishment of the new register would depend on the rate of regulated transactions, but it was considered that a complete register would be created in this way within one or two generations.

3.1.4 The Government appreciated the intention of the recommendation from the CoIoC that boundaries that had, in practice, been accepted for twenty years should not be challengeable but is not persuaded that the opportunity to challenge boundaries available under the existing law should be removed before crofts are first entered on the new register. Whilst the Crofting Acts state that a croft is any holding that has been registered in the Register of Crofts for a continuous period of 20 years and has not been challenged, the description of the boundaries in the old Register of Crofts may not be sufficiently accurate to define the boundary of a croft. Furthermore, it was considered that the description may not be sufficient to satisfy the "long negative" provided for under the Prescription and Limitation (Scotland) Act 1973. Therefore, the Government response stated that it would look to make provision for challenge at the point of first registration. Once the period for challenge has elapsed and the croft has been recorded definitively on the new register, it would not be possible to challenge the boundary again.

3.2 Issues for consideration

3.2.1 Responsibility for the new Crofting Register

3.2.1.1 The Government response agreed that there should be a separation of the Crofters Commission's functions and that the Registers of Scotland should be responsible for establishing and maintaining a new register of crofting interests. This would be known as the Crofting Register. Whilst it considers an accurate and current legal Crofting Register to be prerequisite to the effective regulation of crofting, it also considers it to be important to crofters in providing security and confidence over the extent and interests in a croft. It considers that the Crofting Register should have a status similar to that of the Land Register rather than as an administrative tool for the Crofters Commission.

3.2.1.2 Therefore the draft Bill provides the power for the Registers of Scotland to establish and maintain a Crofting Register.

3.2.2 Triggers requiring a registration on the new Crofting Register

3.2.2.1 Legislation will require a croft to be recorded on the Crofting Register when the following regulatory actions are taken:

• Creation of a new croft
• Enlargement of a croft
• Exchange of a croft or part of a croft
• Assignation of a croft
• Division of a croft
• Bequest of a croft
• Change of ownership
• Resumption or decrofting of croft or part of croft
• Reversion of resumed land
• Vacant crofts
• Reorganisation schemes
• Registering an interest in a croft tenancy
• Registration of owner-occupiers.

The Government considers that these regulatory decisions have a significant effect on the extent or interests in a croft and are, therefore, suitable trigger points for requiring a new entry onto the Crofting Register. The draft Bill contains a power to vary the trigger points requiring a new entry onto the Crofting Register.

3.2.2.2 A croft tenant, owner-occupier or landowner will not have to wait for a trigger point to occur before registering a croft as legislation will provide for voluntarily registration.

3.2.2.3 Where an application is made to update the Land Register following the purchase of land in the Crofting Counties, the registrant will be required to provide details to the Registers of Scotland of any crofts on the land. Where crofts exist on the land, the applicant will also be required to update the Crofting Register.

3.2.3 Process for registering a croft on the Crofting Register

3.2.3.1 Legislation would provide for a process by which a crofter tenant, owner-occupier or landowner would make an application to update the Crofting Register. The process for registration has been designed to be as simple as possible and the Crofting Commission will act as the main point of contact for any applications made to update the Crofting Register. Figure 1 overleaf provides a summary of this process.

3.2.3.2 When an application is submitted to the Crofting Commission for a regulatory decision, a registration form setting out the current details of the croft to be included in the Crofting Register and a registration payment should also be submitted. The Commission would check the details contained in the registration form against the current Register of Crofts, if the Commission is satisfied with the details contained within the registration form it will forward the registration form to the Registers of Scotland for a provisional entry to be made in the new register.

3.2.3.3 At this point, the Crofting Commission would be required to write to the landlord of the croft and the landlord and tenants of land adjacent to the croft to inform them of the provisional registration and to let them know they would have six months to appeal the information to be registered. The Commission would also be required to write to the applicant requesting that they give public notification of the provisional registration. Where none of the details on the registration form are contested or an appeal to the Land Court over the information contained in the form is unsuccessful, the provisional entry would become permanent. Where an appeal is successful, the Land Court would be required to inform the Registers of Scotland of its outcome and the provisional entry would be updated to reflect the outcome of the appeal.

3.2.3.4 Once a decision has been taken in respect of a regulatory application and this amends the details of the provisional registration, the Commission would instruct the Registers of Scotland to update the provisional registration. If an application is refused no changes would be made to the provisional registration.

Figure 1: Process for making a first registration on the Crofting Register

3.2.3.5 If details of a croft are already held on the Crofting Register, and the Crofting Commission agrees to a regulatory application which will change these details, the Commission would be required to notify the Registers of Scotland of these changes once payment has been made.

3.2.3.6 Once a croft is registered on the new register permanently it will not be possible to dispute any of the details contained within the register relating to that croft, except where there has been an administrative error in which case it will be possible to rectify the register. Provisions are made to indemnify anyone who suffers loss as a result of an administrative error. However, it is important to note that it will not be possible to rectify the register once the prescription period has elapsed simply because somebody failed to object within the prescribed period. This would undermine the certainty provided by the new register.

3.2.4 Information to be held on the Crofting Register

3.2.4.1 The Government considers it important to ensure that any information captured on the Crofting Register is relevant to the interests of crofters. The Government has therefore consulted with the Registers of Scotland, the Land Court and the Crofters Commission on the type of information that should be held on the Crofting Register. Legislation would provide for the information which should be held on the Crofting Register, which is similar to other property registers such as the Land Register.

3.2.4.2 The information to be contained on the new register is as follows:

• The name, location and extent of every croft, fixed and scaled against the ordnance map or other mapping system used by the Registers of Scotland
• The name, location and extent of every apportionment, fixed and scaled against the ordnance map or other mapping system used by the Registers of Scotland
• The name, date of birth, and address of the tenant (this would appear as "vacant" on the register where there is no tenant)
• The name, date of birth, and address of the landowner (this would appear as "owner-occupier" where the landowner occupies the croft)
• Any registered interest in a croft tenancy, such as a heritable security
• Any contract or agreement made by a crofter by virtue of which he is deprived of any right conferred on him under the 1993 Act
• Any other contract or agreement made between a crofter and a landowner, or order from the Land Court, concerning access to the croft
• Any other information that the Scottish Ministers may, by Order, require to be registered
• Any other information that the Registers of Scotland may consider expedient to be registered.

3.2.4.3 As previously mentioned, the Crofting Register will be used to compile an electoral roll for Area Committee elections. The Government proposes that only those of 18 years or over and whose details are held on the Crofting Register will be eligible to stand for election to Area Committees. It is also proposed that only those of 16 years or over and whose details are held on the Crofting Register will be eligible to vote during Area Committee elections. However, members of the public will be unable to access details of the date of birth for any registered crofter. As both tenant and owner-occupier crofters will be entitled to vote, it will be necessary to capture the date of birth where the landowner is the crofter.

3.2.4.4 The draft Bill contains a provision making it possible to amend the list of information required in the Crofting Register.

3.2.5 Inclusion of owner-occupiers' details in the Crofting Register

3.2.5.1 In order to ensure that the Crofting Register is a comprehensive record of all land in crofting tenure, provision has been made in the draft Bill to include crofts which are owned by crofters
(owner-occupiers). Owner-occupiers are currently considered to be "landlords of vacant crofts", however, the draft Bill has re-defined the meaning of an owner-occupier. The Government considers it vital for the successful future administration of crofting that crofts which are owner-occupied are properly recorded on the Crofting Register and that they are distinguished from landlords that do not occupy their crofts. This is also consistent with the ColoC's recommendation that crofters and owner-occupiers should be treated alike.

3.2.6 Registration of common grazings

3.2.6.1 The Crofters Commission currently records details of common grazings on the Register of Crofts. The Government proposes that the new Crofting Register should also record details of common grazings in order to ensure that the register captures all land in crofting tenure. The Government proposes to cover the costs for the initial registration of a common grazing. However, charges for subsequent amendments will need to be met by shareholder(s) wishing to make a change to the common grazing record. It is proposed that an application for a new entry or amendment to the Crofting Register for a common grazing would be made to the Crofting Commission who would check the details contained within the registration form against its records and, if content with the details contained in the form, the Commission would forward this to the Registers of Scotland. It is considered to be in the shareholders' interest to have a clear record of their share in a common grazing. Legislation will provide for the type of details which should be recorded in relation to a common grazing on the Crofting Register. These are:

• The name, location and extent of every common grazing, fixed and scaled against the Ordnance Map or other mapping system used by the Registers of Scotland
• The name and address of the owner of the grazing
• The name and address of each person holding a share in the common grazing; a description of that share; and any registered interest in that share, such as a heritable security
• Any other information that the Scottish Ministers may, by Order, require to be registered
• Any other information that the Registers of Scotland may consider expedient to be registered.

3.2.6.2 The consent of the Crofters Commission is currently required to constitute land as a common grazing, therefore, any application to create a new common grazing would go through the same process outlined in section 3.2.3.

3.2.6.3 The consent of the Crofters Commission is currently required for a tenant crofter or an owner-occupier to apportion part of the common grazing for their exclusive use. Any application to apportion part of a common grazing would go through the same process outlined in section 3.2.3.

3.2.7 Charges for the Crofting Register

3.2.7.1 The Government response stated that the Registers of Scotland would charge a fee in accordance with a standard fee schedule to make an entry on the Crofting Register. This is currently the case for other property registers such as the Land Register. The Government also proposed to consider whether or not a fee for inspection of the new register would apply.

3.2.7.2 The Registers of Scotland is required to cover the costs incurred through its administration of the Crofting Register. As such, the draft Bill provides the Registers of Scotland with the ability to charge a reasonable fee in accordance with the Registers of Scotland's standard fee schedule for making a first registration on the new register and any subsequent amendments. Legislative provision will also enable the Scottish Ministers to make grants to the Registers of Scotland in relation to the Crofting Register.

3.2.7.3 The aim is to make the costs of registering on the Crofting Register broadly comparable with the charges made for registering property in the Land Register. The average fee for an application for registration of a property for the first time in the Land Register is in the region of £250. It is proposed that the cost of making a first registration on the Crofting Register and any subsequent amendments would be met by the person applying to register the croft in the Crofting Register, although the Government will have the power to subsidise the cost of first registration.

3.2.7.4 Legislative provision would allow the Crofting Commission to handle fees on behalf of the Registers of Scotland. This provision is in place to ensure that the process for updating the Crofting Register is efficient. The Commission will handle the regulatory application, the registration application and the fee. Where no regulatory decision is required, the crofter, owner-occupier or landowner would still submit their registration application to the Crofting Commission who would have responsibility for checking the application against its records before forwarding it to the Registers of Scotland to update the register.

3.2.7.5 As with the Land Register, the draft Bill also includes provisions to enable the Registers of Scotland to charge a fee for inspection of the Crofting Register.

3.2.8 Ability to challenge at the point of first registration

3.2.8.1 The Government rejected the ColoC's recommendation that croft boundaries which had been accepted for 20 years should not be challengeable. Instead, the draft Bill contains a provision to allow a challenge to be made to croft boundaries at the point of first registration. It is proposed that once an application has been provisionally registered on the Crofting Register, the Crofting Commission would write to persons with a known interest in the croft to inform them that a person has applied to register their croft on the new register. The applicant would also be required to post a public notice, in the form prescribed by the Crofting Commission, in a conspicuous place and in a local newspaper. Persons with a known interest in a croft are considered to be:

• The landowner and crofter of the croft; and
• Tenants and owners of land adjacent to the croft for which a registration application has been submitted;

Persons with a known interest in a common grazing are considered to be:

• The landowner of the common grazing and those holding a share of the common grazing; and
• The landowner and those with an interest in land adjacent to the grazing.

3.2.8.2 Persons with an interest may object to the registration of the croft or common grazing if they dispute any of the facts contained in its application. That person will be able to lodge an appeal with the Land Court, within six months of notification being given. The Land Court will be required to notify the Registers of Scotland within seven days where an appeal is lodged and no further action will be taken by the Registers of Scotland in respect of the application until the Land Court has ruled on the objection. If an appeal is upheld, provisional details held on the Crofting Register will be updated to reflect the outcome. Where an appeal is unsuccessful or no appeal is lodged, the provisional entry will become permanent. Once a croft is registered permanently, it will not be possible to dispute the boundaries of the croft again. This presents a fair and open opportunity for persons with an interest to object to the details of a croft or common grazing registration before these details are recorded permanently on the Crofting Register.

3.2.9 The current Register of Crofts

3.2.9.1 It is proposed that the Crofting Commission should be able to maintain the current register until such time as it has been completely replaced by the new register. However, once a record for a croft has been made in the new register, any record on the old register should be removed. Any information held on a croft in the current register that will not be recorded on the new register, but which is important for the administration of crofting, should be kept as an administrative record on a separate database. Once the Crofting Register is complete, it will be necessary to repeal the provisions relating to the current register.

3.2.10 Conclusion

3.2.10.1 The proposals for a Crofting Register will provide an up-to-date and complete record of land in crofting tenure and the interests in that land. This will provide security and reassurance to crofters, owner-occupiers and landowners as to the extent and interests in a croft. It is considered that the Crofting Register will make it easier for crofters to access commercially available loans as it will also give lenders reassurance over the extent and interests of a croft. The process has been designed to be as expedient as possible and to ensure one point of contact in relation to the registration of croft land.

3.3 Regulatory and Equality Impact Assessment

3.3.1 Issue

3.3.1.1 The Crofters (Scotland) Act 1993 requires the Crofters Commission to compile and maintain a Register of Crofts. The ColoC found that the Register of Crofts has never been complete or up to date and stated that an accurate and current register was a prerequisite for the effective regulation of crofting. Also, the current register is an administrative tool and does not provide tenant crofters with sufficient legal certainty as to the extent and interests in their croft. This can lead to disputes between the crofter and the landowner and prevent a tenant crofter from using his tenancy as security for a loan. There are a total of 17,700 registered croft holdings, which accounts for 17% of land across the Crofting Counties.

3.3.2 Objective

3.3.2.1 The objective of the draft Bill is to allow for the creation of a new Crofting Register that will provide greater legal certainty over the extent and interests in a croft in order to provide greater security for crofters and to improve the regulation of crofting.

3.3.3 Potential Risks

3.3.3.1 Potential risks associated with creating a definitive Crofting Register include:

• Creating disputes between crofters and landowners over the extent and interests in a croft and common grazing
• Overwhelming the Crofting Commission and the Land Court with applications and appeals over information contained within a definitive register
• Excessive costs associated with creating a definitive Crofting Register.

3.3.4 Options

3.3.4.1 In broad terms, three options are available:

(i) Do nothing;

(ii) Use existing legislation to update the current register; or

(iii) Create a new register under the auspices of the Registers of Scotland.

3.3.5 Benefits

3.3.5.1 Option 1 involves no change, meaning the current register would remain incomplete and unable to provide legal certainty over the boundaries, and interests, in crofts.

3.3.5.2 Option 2 would go some way to increasing the accuracy of the current register but it would remain an administrative record and would not provide greater confidence over the extent and interests in a croft. Particular problems associated with owner-occupiers failing to notify the Commission of changes to the extent and interests in a croft would remain unresolved.

3.3.5.3 Option 3 is a variation of the recommendation made by the ColoC and would allow for a new accurate register to be established by the body responsible for property registers in Scotland. It would provide greater benefits to crofters by providing greater certainty over the extent and interests in their croft.

3.3.5.4 The Government decided to proceed with Option 3 and its proposals are set out in section 3.2 of this document.

3.3.6 Impact on Stakeholders

Crofters

3.3.6.1 It is considered that crofters will benefit from the development of a new Crofting Register as it will provide a definitive record of the extent and interests in their croft. Once this record becomes permanent it will be unchallengeable, thus providing the crofters with the ability to use their tenancy as security for any loans they may wish to access. The process for registering a croft is designed to be efficient as the crofter will only be required to deal with one organisation. When a crofter registers details of his croft, he will be required to pay a fee for the registration in line with the Registers of Scotland fee schedule. The Crofting Register will be open to public inspection but, to cover administrative costs, the Registers of Scotland would charge a fee for any extracts. This is consistent with the requirements of the Registers of Scotland to recover the cost of their operations. Legislation will contain a provision which would enable Scottish Ministers to provide the Registers of Scotland with a grant to off-set some of these costs.

Landowners

3.3.6.2 The process of registering a croft is designed to be fair to both crofters and landowners. The landowner of the croft, or of any land adjacent to the croft will be able to appeal against information contained within a registration application form if they believe that it is incorrect. The Government chose not to accept the recommendation of the ColoC that croft boundaries which have been accepted over time will automatically become legally binding. Instead, it chose to provide a right of challenge at the point of first registration. There is a requirement for landowners, including owner-occupiers, to register any crofts on the Crofting Register when changes are made to the Land Register concerning the ownership of the land. Crofters will have the same rights of appeal as the landowner when registering a croft in the Crofting Register.

Crofters Commission and other NDPBs

3.3.6.3 The process of registration requires the Crofting Commission to perform an administrative role and to process registration application forms. The Commission will check that the contents of a registration application form are consistent with their records before sending it to the Registers of Scotland to be provisionally entered onto the Crofting Register. They will also notify those with an immediate interest of the provisional registration on the Crofting Register. The Commission will continue to maintain administrative records in relation to each croft.

3.3.6.4 The volume of registration applications will determine the impact on staff resources of the Commission. In order to manage the impact on the Commission and other stakeholders, it is proposed that the new register should be established over a period of time and certain regulatory "trigger points" have been identified that will require a first registration on the new register. This will ensure that the workload remains manageable for the Commission and other stakeholders. This gradual replacement is similar to the approach to replace the Register of Sasines with the Land Register.

Registers of Scotland

3.3.6.5 The Registers of Scotland will have responsibility for operating and maintaining the Crofting Register. They will have to put in place the necessary infrastructure and resources to enable them to operate the new register. The Registers of Scotland recognises the synergies between the Crofting Register and other land registers it is responsible for. The Registers of Scotland will benefit from taking over responsibility for the Crofting Register as it will help them to create a fuller picture of interests in Scottish land.

Land Court

3.3.6.6 It is considered that the Land Court could experience a higher workload in the short term resulting from appeals against information contained within a registration application, given that the boundaries of croft land will be unchallengeable once permanently registered. However, this should lead to a reduction in cases in the longer term once the new register becomes more complete. The proposal to create the new register over a long period of time will help the Land Court to manage this workload.

3.3.7 Costs

3.3.7.1 The Crofters Commission currently administers the Register of Crofts and it is expected that current resources will be sufficient for it to undertake its administrative role in relation to the creation of a new Crofting Register.

3.3.7.2 The most significant cost associated with the development of a Crofting Register would be the infrastructure. The Registers of Scotland have estimated that capital costs for developing a new register would be in the region of £907,000-£1,387,000, excluding VAT. The economic analysis undertaken by consultants for the ColoC recognised that by transferring responsibility for the Crofting Register to the Registers of Scotland, some efficiencies would ensue as the Registers of Scotland already specialises in similar tasks and would bring expertise, experience and economies of scale. The Scottish Government has agreed to fund the infrastructure costs associated with creating a Crofting Register.

3.3.7.3 The Government recognises that it would need to pay for the first registration of existing common grazings given the number of different interests in a common grazing and the complexities associated with arranging payment. Further work is needed on the cost of this operation.

3.3.7.4 The aim is to make the costs of registering on the Crofting Register broadly comparable with the charges made for registering property in the Land Register. The average fee for an application for registration of a property for the first time in the Land Register is in the region of £250. It is proposed that the cost of making a first registration on the Crofting Register, and any subsequent amendments would be met by the person applying to register the croft in the Crofting Register, although the Government will have the power to subsidise the cost of first registration.

3.3.8 Small Firms Impact Test

3.3.8.1 It is not considered that the proposals to develop a new Crofting Register will have any impact on small firms.

3.3.9 Competition Assessment

3.3.9.1 It is not considered that the proposals relating to develop a Crofting Register will create any comparative advantage or disadvantage within the sector.

3.3.10 Enforcement and Sanctions

3.3.10.1 These proposals are concerned with changes to the administration of a Crofting Register and do not create any new sanctions.

3.3.11 Equity and Fairness

3.3.11.1 The process for registering a croft on the Crofting Register is considered fair as it enables relevant parties to appeal against information contained within the registration application. There are no barriers of race, age, sex, income, religion, sexual orientation or disability which would prevent a crofter from registering his croft.

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