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24 January 2014
What effect does the Freedom of Information Act have on the Land Registry? By Joann Bainton
On 1 January, the provisions of the Freedom of Information Act 2000 (FOIA) came into force. The effect of this is that anyone has the right to request recorded information that a public authority holds, unless an exemption applies, in which case the authority may refuse to disclose. A number of categories of exemptions are 'qualified', which means that they are overridden if that is where the balance of the public interest lies. But what impact does this have on the Land Registry? And what are the implications of this?
The Land Registry Publication Scheme
Under the FOIA, all public authorities are tasked with adopting and maintaining a publication scheme. The Land Registry's scheme sets out classes of information that the Land Registry has made available to the public, or intends to make available as a matter of course. Any information requested under the Land Registry Scheme is not an FOIA request as it is information considered to be available elsewhere. The scheme also sets out the fee for the provision of the information requested.
The Land Registry Act and Land Registry Rules
The Land Register of England and Wales has been open to public inspection since 1990, but some documents, such as leases and mortgages, have not been freely available. However, the Land Registration Act 2002 and the Land Registration Rules 2003 provide that all documents sent to the Land Registry to be placed on the register from 13 October 2003 have been open to public view since that date. This means that any document registered against a title number can be requested by a member of the public, including documents containing potentially sensitive information.
The 2002 act and the rules do, however, allow anyone whose interests may be prejudiced by the disclosure of sensitive information to apply to have that information removed, so that only a modified copy of the document is freely available. If the application is successful, the document will become an Exempt Information Document (EID).
Documents lodged prior to 13 October 2003
In the case of the many documents lodged with the Land Registry prior to 13 October 2003, the 2002 act and the rules provide a transitional period of grace. Documents registered with the Land Registry prior to 13 October 2003 cannot automatically be seen on the public register.
The purpose of the transitional arrangements was to allow people and companies likely to be prejudiced to consider whether any documents held at the Land Registry held sensitive information. People affected in this way have had the opportunity during the past two years to make EID applications to modify documents so that sensitive information can be excluded and documents treated as EIDs.
The transitional period ended on 13 October this year. Since then, all documents that have been sent to the Land Registry are on the public register and, as such, are accessible by anyone unless they have been designated as EID documents.
What does this new regime mean?
Anyone who does not apply to have commercially sensitive information excluded from the register may find it in the hands of a third-party competitor. The sorts of information that may be of interest will include any 'special deals' done with tenants, such as allowing them long rent-free periods or giving them more favourable terms than other tenants. This could prove controversial in relation to high-profile developments, such as new shopping centres.
The terms on which a business occupies premises might at first glance seem dull, but it can have a huge impact on the share prices of both the occupier and its landlord. If the market gets wind of the fact that the biggest tenant in a high-profile development has the right to break its lease and walk away after three years, investors might wonder whether to put their money elsewhere. Similarly, the reputation of a struggling retailer will not be helped if the market can see that it has many years left to run on leases with very high rents.
Even if a document has been designated as an EID, sensitive information may still be disclosed. Under the terms of the FOIA, a member of the public, including businesses as well as individuals, can still apply to see a complete version of a document that has been determined an EID by the Land Registry. The Land Registry has 20 working days in which to respond to such a request and may either choose to provide the information or inform the person concerned that the information cannot be supplied to them because in the Land Registry's view, it falls within one of the exemptions to the FOIA.
Under the FOIA, the Land Registry will have to make a decision as to whether the information requested by a member of the public under the terms of the FOIA contains personal information as defined by the Data Protection Act 1998. If they conclude that it does, this information will not be made available to the person who has requested it. It will be for the titleholder to persuade the Land Registry that the information contained in the requested document falls into one of the exemptions of the FOIA and therefore should not be provided.
Of most concern is that the Land Registry is not legally obliged to inform the titleholder that it is going to release information in an EID. This is a problem for whoever made the EID application, because they will not necessarily know that commercially sensitive information on the Land Register has been provided to a third party. The Land Registry has said that in practice it will try to contact the person who applied for the document to be an EID to ask them why the information is sensitive before making a decision about whether to release it.
The new regime goes both ways. Those potentially prejudiced by the disclosure of sensitive information might themselves get some benefit out of applying to see information about others. We may all have to get used to the fact that it is getting increasingly difficult to keep a secret.
Joann Bainton is an associate at SJ Berwin