The High Court recently overturned a retrospective consent for unauthorised alterations to agricultural buildings.

The judge held that the Council unlawfully concluded that the applicant had a “fall-back” position of being able to operate the site as a dairy farm without the unauthorised development.

Background

The applicant acquired agricultural land and set about creating a dairy farm under permitted development rules. However, the applicant altered existing barns by building a concrete yard area and concrete cladding to keep his cows within the confines of the barns. This constituted unauthorised engineering operations.

The applicant sought to regularise the planning position by applying for a retrospective consent. The Council granted consent for the development which was described as fundamental to the dairy operation. A neighbouring resident challenged the decision by judicial review on the following grounds:

Ground 1: that the Council unlawfully concluded that the applicant had a fall-back position of being able to operate the site as a dairy farm without the unauthorised development

Ground 2: that the Council failed to accord great or considerable weight to Natural England’s objection in relation to two Sites of Special Scientific Interest (SSSIs)

Ground 3: that the Council failed to obtain sufficient information in relation to the odour impacts.

What is the “fall-back position” in planning?

The fall-back position is where development could still take place if a planning application was refused because permitted development rights exist or there is an alternative planning permission. In this case, the applicant sought to establish a permitted development fall-back position of being able to operate the site as a dairy farm without the authorised development and to use it as a lever to gain planning permission due to it being treated as a material consideration.

Judgment

The judge held that the fall-back position was not a real prospect and quashed the consent.

The planning officer described the development as essential for the operation of the dairy farm and the applicant made no attempt to contradict this. The judgement noted the requirement that the planning officer considered not merely what was achievable or “doable” as permitted development, but also whether there was a real prospect that the applicant would have housed cattle in the barns without planning permission – something the available evidence suggested would not have been possible.

The Court also considered that the Council failed properly to consider the impact of development on the SSSIs and the successful challenge on Ground 1 essentially led to success on Grounds 2 and 3.

This decision demonstrates that a fall-back position will be given limited weight if it is unlikely to happen in reality. Click the link to view the full judgment: Ward v Torridge District Council [2023] EWHC 2629 (KB).

Above the vast patchwork of fields carpeting the UK, a silent revolution is unfolding in the skies. Unmanned Aerial Vehicles (UAVs), once confined to military applications and hobbyist pursuits, are being developed for new commercial purposes.

During the coronavirus pandemic, UAVs and drones gained attention for their trialled use by the medical sector, focused on the use of drone technology to deliver medical supplies to patients across Scotland. That organisation has now turned to the development and trial of the UK’s first national network of UAV/drone flight corridors, designed to connect hospitals, labs, GP surgeries and distribution centres.

Similar UAV/drone corridors are also under development in other sectors including logistics and agriculture. With the imminent arrival of widespread commercial use of UAV/drone technology, we consider the myriad legal considerations for private landowners.

Who owns the air above land?

Does a landowner have exclusive ownership of airspace rights over their land? Thirteenth century case law provided that a landowner owned their land “all the way to Heaven and all the way to Hell”. This very literal interpretation of ownership over the vertical column above one’s land cannot persist into the 21st century with the dawn of aircraft, satellites and drones.

The law changed in the 1970s[1] in a case involving an unmanned aircraft deployed to photograph homes with the aim of selling the photographs to homeowners.

The courts determined that landowners’ rights extended to such a height as is “necessary for the ordinary use and enjoyment of their land”.

Trespass and nuisance

UAV operators must obtain a landowner’s permission to land or take off on their land. It is less clear whether the act of flying a UAV over someone’s land amounts to trespass or nuisance in and of itself. It will likely depend upon the extent to which peaceable enjoyment of the landowner’s property is affected (height and frequency of activity, duration, noise, hovering etc.) having regard to the activity taking place on the ground.

Current legislation indicates that UAV users are exempted from liability where an operator pilots their drone over a person’s land in a reasonable manner, at a reasonable height, and in compliance with all other relevant laws and regulations (see s.76(1) Civil Aviation Act 1982). Of course, the meaning of reasonable is open to interpretation and is yet to be properly tested by the courts.

In addition, all UAVs must be flown in accordance with a general duty not recklessly or negligently to cause or permit them to endanger any person or property.

A landowner is more likely to have an actionable claim where a person causes a UAV to engage in an activity which could be considered a trespass or nuisance, such as landing without permission or causing property damage or personal injury.

Owners or operators of drones will be held to strict liability (liable regardless of one’s intention) for any surface damage, personal injury or damage to a person’s property caused by a drone[2].

Liability is channelled through the owner or operator of the drone and, unless the injury or damage is as a result of the victim’s own negligence, the victim must be compensated.

If a person intentionally or recklessly hits someone or their property with a UAV, they could also be liable for a criminal offence such as battery or criminal damage.

The Civil Aviation Authority (CAA) is the UK’s primary statutory regulator for aviation, including UAVs. Most prosecutions against errant drone operators are conducted by the CAA, although the police have taken an increasingly active role in pursuing prosecutions against individuals.

It should be noted that landowners can also be held responsible for accidents that take place on their land if they have given the drone operator permission to take off or land on their property.

Data protection and privacy

Landowners are also likely to be concerned about the risks UAVs pose to their privacy, particularly those with sophisticated cameras and sensors which process personal data. This may lead to confidentiality and privacy issues if a drone captures footage of, for example, people, vehicles or signage over land.

In the UK, processing of personal data is subject to the GDPR and Data Protection Act 2018. The Information Commissioner’s Office (ICO) is the UK data protection regulator in charge of enforcing legal requirements. Any drone with a camera should be registered with the CAA. Where a drone operator contravenes data protection rules, the ICO can pursue enforcement action, including fines.

What can landowners do if they are affected by UAVs/ drones?

It can be difficult for landowners to regulate unwanted UAV/drone behaviour. However, there are a number of things they can do. Collecting good records and evidence such as recordings and photos of drone use can be helpful. Reporting incidents to the police and making enquiries of the CAA should also be considered. In more persistent cases, landowners can employ drone tracking technologies. Concerned landowners may also want to register their land as a no-fly zone with the No Fly Drones website.

[1] Bernstein of Leigh v Skyviews & General Ltd [1978] 1 QB 479

[2] Section 76 (2) Civil Aviation Act 1982

Dhana Sabanathan, a Partner in Michelmores’ Tax, Trusts & Succession team in London, part of the Firm’s Private Wealth group, has won Gold in the ‘Outstanding Individual of the Year’ category at CityWealth’s Powerwomen Awards 2024.

The Awards took place on 6 March at the JW Marriott Grovesnor House Hotel in Park Lane, London. The annual ceremony recognises outstanding female leaders in the wealth sector, namely individuals and companies who maximise the potential of women in wealth. The Awards also create a platform for best practice to collectively exercise positive social influence on the sector.

Her Gold success is in respect of Dhana having increasingly been recognised as a ‘go to’ lawyer for advice on complex technical legal points. She is seen as a “safe pair of hands” to guide clients in a way they understand though challenging scenarios, including being called in to provide a second opinion or a more practical way of dealing with a structure.

Dhana specialises in advising high net worth and ultra-high net worth individuals, family offices, entrepreneurs, corporates and owner-managed businesses. She advises significant family offices and in addition to UK based clients, acts for clients based in Europe, the US, Asia and the Middle East.

In the space of just under a year since joining Michelmores, Dhana has also been helping to grow the Firm’s Private Wealth group. The team has seen a year-on-year growth of 15% in addition to an increase in the calibre of the Firm’s clients both in London and internationally.

Moreover, Dhana is ‘independently ranked’ for Private Wealth Law in the Chambers High Net Worth Guide 2023 and has been recommended in the Legal 500 guide for 2023. She has also been recognised in the Citywealth Leaders List as well as Eprivate Client. Dhana is a contributing author at LexisNexis, a member of STEP and on the committee for the STEP City of London branch, and was awarded Silver in the “Woman of the Year – Business Growth Mid Size” category in the 2021 Citywealth Powerwomen Awards.

Dhana comments on her accolade:

“It has been a remarkable year at Michelmores and I am so grateful to the Firm and my wonderful colleagues for the success we have achieved. It is wonderful to get this recognition from CityWealth and to see the spotlight on so many remarkable women in the private wealth industry.”

Michelmores was also named Law Firm of the Year – UK at the 2024 CityWealth Magic Circle Awards, which took place on 15 May. The Firm’s Private Wealth group are long standing, trusted advisors to numerous high net worth individuals and families in the UK and internationally, and work tirelessly to provide creative solutions for our clients and their nuanced requirements.

At Michelmores, we believe that being one of the best Private Wealth law firms demands an equal strength and focus on both the personal and business needs of our clients. We strive to offer joined up thinking across all related areas and work closely with some of the best advisers across the UK and Internationally to deliver a truly exceptional service.

Read more about the Firm’s Private Wealth team on our website.

Amongst the flurry of Budget announcements, the Government today published its long-awaited response to the consultation on the taxation of ecosystem service schemes.

This guidance appears to be a positive first step towards establishing a robust tax framework which will help facilitate the ongoing growth of the Natural Capital economy.

We set out the key, headline points below.

Agricultural Property Relief (APR)

• In a move which will be much welcomed by landowners and advisers alike, the Government have confirmed that they will extend the existing scope of APR to include environmental land management from 6 April 2025.
• The key points are:
  • Relief will be available where the environmental land management scheme is entered into on or before 6 March 2024 (provided that it remains in place after 6 March 2024), but relief will only be available for lifetime transfers and transfers at death which take place on or after 5 April 2025.
  • Relief will be available for land managed under an environmental agreement with or on behalf of the UK Government, Devolved Administrations, public bodies, local authorities or approved responsible bodies.
  • Relief will continue to be available following the conclusion of an agreement, provided that it continues to be managed in a way which is consistent with the agreement.
  • For the relief to apply, the land in question needs to have been agricultural land for at least 2 years prior to the change of land use, although interestingly one would not have to show that the land had been used for the purposes of agriculture or would have qualified for APR in its own right.
  • Ownership period requirements for APR will not be restarted by land use change.
  • The value of the relief will be based on a special assumption of a restriction as to its current use – presumably, much in the same way as “agricultural” values. Hope and development values will remain part of the open market value, which may have interesting implications for valuers and tax advisers if the open market value of the land extends beyond its “environmental” value (see further below).
  • Farmhouses (and ancillary buildings) will qualify for relief if occupied with, and that occupation is ancillary to, environmental land.
• The existing (and now long out of date) land habitat provisions set out in Section 124(c) of the Inheritance Tax Act 1984 will be repealed.

Business Property Relief (BPR)

• There are no proposed changes to the operation of BPR in this context, and the general rules will continue to apply. The availability of BPR will be assessed on a case-by-case basis in the usual way. BPR will continue to be available if the land in question forms part of a wider, composite, trading business (for example, in a “Balfour” context).
• The Government have also reaffirmed that the activities required to design, create, and maintain schemes falling within the Woodland Carbon Code and the Peatland Carbon Code are trading activities for BPR purposes.
• However, this guidance does not appear to go far enough to specifically confirm whether or not the activities required to develop and maintain other environmental schemes (including those involving Biodiversity Net Gain and Nutrient Neutrality, for example), would be deemed to be trading for BPR purposes.
• The activities carried out in each case will need to be carefully considered. However, in the absence of specific guidance, this may remain an area of uncertainty, and it will be interesting to see whether the draft legislation goes some way to redressing this in due course.

VAT

• The underpinning legislation for the VAT Terminal Markets Order (TMO) will be updated, including bringing trades in carbon credits within the scope of VAT and the TMO.

Working group with industry representatives

• The Government will be establishing a joint HM Treasury and HMRC working group tasked with clarifying the tax treatment of the production and sale of ecosystem service credits and associated units. DEFRA will also provide input.

Potential restrictions to APR

• The government have decided not to restrict APR to tenancies of at least 8 years. One of the deciding factors was that they felt it may lead to a contraction in the land available for tenant farmers. DEFRA will continue to work with the industry and look to support longer term tenancy agreements which retain flexibility.
• Environmental Land Management Schemes will also be accessible to tenant farmers, and this includes for tenants on shorter terms, on rolling annual tenancy agreements and on longer terms.
• Penalties will no longer be applied for tenants who have to exit a scheme early if their tenancy ends unexpectedly.
• Whilst tenants need to check the terms of their tenancy agreement before applying to SFI, SFI does not require the tenant to gain the landlord’s consent although in the spirit of collaboration, the expectation is that the tenant would communicate with their landlord.
• DEFRA is also looking to ensure that more options are offered on shorter durations in their combined Environmental Land Management Scheme offer for 2024.

Comment

• The Government have clearly stated that the potential loss of APR should not be a barrier to land use change. This is a very welcome move and reassures landowners that they should not be forced to choose between (1) using their land in environmentally friendly ways for economic gain on the one hand and (2) the potential loss of valuable APR on the other. The guidance makes sense and seems to suggest that the legislation will follow the current APR framework closely, with ownership periods, farmhouses and ancillary buildings all covered. Draft legislation will be embodied in a future Finance Act, and we await sight of that with interest.
• That said, there is an argument to say that the change will not come soon enough – the relief will not be available on lifetime transfers or deaths until 5 April 2025.
• And the position in relation to BPR is less clear, with no proposed changes to incorporate environmental land usages. It had been hoped that the Government would offer further guidance in relation to whether activities required to run (for example) BNG and Nutrient Neutrality schemes could also be deemed to be trading (as they are for the Woodland Carbon Code and the Peatland Carbon Code).
• This “mismatch” with BPR could trigger some interesting valuation issues if the land used for environmental purposes is deemed to have a “hope” value above its agricultural / environmental value. The agricultural / environmental value would be covered by APR, but any “hope” value would not. This will provide further food for thought for landowners and advisers alike, particularly as valuations develop in this area.
• Overall, this is clearly very welcome news, particularly in relation to APR, which will provide some comfort for landowners as they continue to explore opportunities in this area.
• However, there remain a number of tax uncertainties (not least the treatment of payments received under ecosystem service schemes, and whether they income or capital), and so this feels like the first step along what will inevitably be a long road to an efficient framework for environmental taxation.

The full response can be found here: Government_response_-_taxation_of_environmental_land_management_and_ecosystem_service_markets_w._logo.pdf (publishing.service.gov.uk)

Michelmores has advised Family Adventures Group Ltd, a rapidly expanding leisure venue and day nursery group, on its £5m investment from Foresight Group, the regional private equity investment manager.

Founded by husband-and-wife team Tom and Laura Filer, Family Adventures Group’s operations are built on a “hub and spoke” model which sees a children’s leisure site opening with accompanying nurseries created nearby. There are currently six nursery sites across the South West and Midlands, which are supported by two leisure venues.

The investment from Foresight will support the Group’s ambitious growth plans, which will see the creation of further new leisure sites with accompanying nurseries across the South West and Midlands.

The Michelmores team advising on the deal was led by Partner Harry Trick with support from Adam Quint, Hollie Halston, Sena Guvercin (all from the Firm’s Corporate team) and Cathy Bryant (a Partner in the Firm’s Corporate Tax team).

Tom Filer, chief executive of Family Adventures Group, added:

“We’re proud of the growth we have been able to achieve since starting in 2019, creating high-quality childcare and leisure venues. The whole team is delighted to have investment from Foresight into our company to allow us to turbocharge our growth.”

“We were really impressed with the support provided by the team at Michelmores and the commercial approach that they took – they were outstanding“.

Nick Mettyear, Senior Investment Manager at Foresight Group, said:

“Tom and Laura have created an exciting business model that shows real potential for growth. The team are targeting areas where there has been a chronic shortage of quality early years education options and will provide an excellent alternative to parents. The imaginative playscapes in the leisure sites will also bring a new approach to educational and interactive play.”

Also advising on the transaction were Evelyn Partners (Corporate Finance to Family Adventures Group) and Shoosmiths (legal advisors to Foresight Group).

In Great Britain, the potentially harmful effects of activities in the marine environment are controlled by a complex system of marine management, primarily governed by the Marine and Coastal Access Act 2009 (MCAA). This article provides a brief introduction to MCAA, and considers how the current regime has operated to protect the marine environment.

MCAA introduced a single framework for marine management and licensing. At that time, the policy emphasised the need to sustainably manage, enhance and use the natural environment for the benefit of current and future generations[1]. This was effected in MCAA by imposing an objective on the regulator to contribute to the achievement of sustainable development (General Objective)[2].

How do we currently protect the marine environment?

The regulators of the GB marine environment (Regulators) further the General Objective primarily through marine licensing and conservation zoning, and the management of marine fisheries.

Marine Licensing

Unless an exemption applies, anyone undertaking an activity listed in MCAA must have a licence from the licensing authority[3]. The list of licensable activities captures most activities in the marine environment, including any that involve removing or depositing objects; constructing, altering or improving works (in or over the sea, or on or under the seabed); scuttling and dredging, among others. When determining an application for a marine licence, the licensing authority must have regard to the need:

• to protect the environment
• to protect human health
• to prevent interference with legitimate uses of the sea (e.g. navigation, fishing).

The authority may also consider any other matters that it thinks relevant, provided always that it functions in accordance with the General Objective.

Marine Conservation Zones (MCZs)

MCAA allows the Regulators to designate zones to conserve or protect species of marine flora and fauna, marine habitats, and other significant features of the seabed.

Where a public authority’s functions may affect an MCZ, that authority must act in the manner that best furthers or (if this is impossible) least hinders the MCZ’s conservation objectives.

To help further these objectives, and to protect MCZs generally, the Marine Management Organisation (MMO) may make byelaws to control activities not currently regulated (licensed) in the inshore region[4].

This supports a key MCAA objective of building a network of marine protected areas (MPA) that contributes to the conservation or improvement of the marine environment[5].

Marine Management Organisation (MMO)

MCAA established the MMO, the primary Regulator of marine activities in the seas around England and Wales. The MMO exercises many functions on behalf of the UK Government. In so doing, it must reach a balance between environmental, social and economic considerations.

Management of Fisheries

The MMO may, for example, make byelaws relating to the offshore exploitation of sea fisheries resources (animals or plants) in England and Wales for the purpose of conserving marine flora and fauna or marine habitats. The Regulators have greater powers in this respect in relation to certain MPAs.

MCCA also established inshore fisheries and conservation districts/authorities (IFCAs) to manage the exploitation of sea fisheries with a direction to ‘seek’ to ensure that this is carried out in a sustainable way.

Historically, GB’s fishing fleets and stocks were managed under the EU Common Fisheries Policy which aimed to ensure the long-term viability of fish stocks and promote sustainable fishing practices. The Fisheries Act 2020 now provides the framework for GB fisheries management.

Has the existing regime been effective?

Marine Licensing Though the Regulators may include any relevant matters in their consideration of marine licence applications, the prescribed decision-making criteria (see above) is protective and preventative.

The Regulators are encouraged by the General Objective to promote a positive change in the marine environment, but the language of marine licensing instead promotes decisions that maintain the status quo. The focus of policy remains on marine recovery and habitat enhancement, and there is some question on how that can be achieved under the current licensing regime.

Marine Conservation Zones

Some of the criticisms of how MCZs operate include:

a) Protecting features of conservation interest will not restore biodiversity

MCZs are intended to maintain or restore specific features (habitats or species) to ‘favourable’ condition, within defined areas. In this, MCZs are broadly successful; but there is evidence that feature-based conservation is not supporting the recovery of marine biodiversity[6].

A long-term study of conservation measures at Lyme Bay found that adopting broad-scale habitat measures across the whole site resulted in a significant increase in biodiversity; exceeding the objectives for the individual features of conservation interest.

The ‘whole-site’ approach is notably more aligned with EU Directives (from which the UK’s MPA policy derives) which recommend measures that improve an area’s “ecological integrity” – the coherence of its structure, habitats and species, as a whole.

b) MMO byelaws fail to promote positive change

As with the narrow focus of MCZ conservation objectives, the limited scope of the MMO’s byelaws regime undermines the wider goals of sustainable development. The MMO may make byelaws to further the conservation objectives of MCZs or to manage the exploitation of sea fisheries resources. In either case, the purpose of any byelaw made under this power is limited to the conservation or protection of specific marine features.

Given that MCAA’s model byelaws exclusively restrict or prohibit potentially harmful activities, it is unsurprising that there were only 10 MMO byelaws in force last year; all related to restricting the use of bottom-towed fishing gear[7]. There is a question mark over how the regime can promote activities beneficial to the marine environment, and ensure that it is not instead inhibiting them.

Management of Fisheries

A major criticism of the regime for protecting the GB marine environment is the failure to recognise that marine conservation and fisheries management are interdependent.

The ability of fish stocks to replenish themselves is dependent on marine habitats providing nurseries for juvenile fish. However, certain fishing activities are linked to the destruction of those very habitats. A report produced by Oceana in 2023, “Taking Stock, The state of UK Fish populations 2023”, stated that “…destructive bottom trawling is allowed in 90% of UK offshore marine ‘protected’ areas […] making a mockery of the concept of ocean conservation”[8].

Further, the Oceana report claims that 5 out of 10 of the UK’s most important fish stocks are being overfished or are in a critical state. If that is the case, then the levels of fishing activity in the UK are not supported by the existing marine habitats despite a long-term policy to promote sustainable fisheries.

A thriving fishing industry is considered essential in providing nutritious, local produce and must be supported with thriving marine habitats.

How can MCAA be used most effectively to improve marine environments?

MCAA provides a comprehensive framework for the protection of our marine habitats, as well as providing the authority and the tools for the Regulators to give effect to the General Objective. To date, however, it has been deployed restrictively, protecting specific features without contributing to the restoration or enhancement of marine habitats. Meeting the wider aims set out under MCCA, i.e. sustainable development, requires more than maintaining the status quo.

Since 2018, the UK Government has consulted on how to incorporate a requirement for “Marine Net Gain” (MNG). MNG refers to the principle that new marine developments[9] should leave the environment in a measurably better state than before development. For MNG to deliver on restoring marine habitats and increasing biodiversity, a holistic management approach to all marine activity must be adopted, harmonising the competing demands on our waters.

[1] Defra, “A Sea Change: A Marine Bill White Paper” (Defra, 2007) p 2.

[2] Strictly, the General Objective applies to the regulator in England. However, the equivalent organisation in Wales has a similar objective. For simplicity, we refer to both objectives as “the General Objective” here.

[3] The Marine Management Organisation, in England; or Natural Resources Wales (NRW), in Wales.

[4] The Welsh Ministers have an equivalent power to make “conservation orders” in Wales.

[5] This is to fulfil the UK’s requirement to designate ecologically coherent and representative networks of Marine Protected Areas under the Marine Strategy Framework Directive (2008).

[6] Siân E. Rees, et al. “Emerging themes to support ambitious UK marine biodiversity conservation” Marine Policy, Vol 117, 2020.

[7] MMO Guidance: Understand MMO marine conservation byelaws (Jan 2023).

[8] Oceana, “Taking Stock: The State of UK Fish Populations 2023” (Sept 2023), p 3.

[9] In this case, development activities in English waters below the mean low water mark.

We have touched upon the environmental advantages of promoting marine nature recovery throughout The Blue Economy publication. Sometimes, rightly or wrongly, it takes the identification of economic opportunities to really see the acceleration of an emerging sector.

In this article, we consider the commercial opportunities of marine net gain and highlight three innovative businesses that we are working with that are advancing marine nature recovery and building growth businesses while doing so.

The government released its response to the public consultation on the principles of Marine Net Gain (MNG) last year (the Response).

Net gain is the concept of leaving the environment in a measurably better state than prior to any development. We have seen an explosion of activity following the mandatory requirement on all land developers in England to deliver a 10% Biodiversity Net Gain (BNG) when building new housing, industrial or commercial development. The new mandatory BNG applies to developments on land and intertidal locations, down to the mean low water mark.

MNG will complement the mandatory BNG regime and, pursuant to the Response, apply to any development that takes place below the mean low water mark. Assuming the structure of the BNG regime is followed (and the Response does refer to strong support by respondents of a mandatory requirement for MNG), marine development will only be permitted if the developer brings about or secures an improvement in the marine environment.

Marine development includes, for example, fisheries, port and harbour development, sewage and waste transportation and offshore wind farms. All involve significant infrastructure and will frequently result in significant damage to the marine environment.

If mandatory MNG is adopted in line with the Response, there will be a statutory duty on all those in industries that undertake marine development, such as the marine fishery, marine engineering, marine transportation and marine energy sectors, to improve the marine environment either in and around their development or elsewhere.

So how does this create commercial opportunities?

We are seeing a burgeoning market develop for BNG units where on-site BNG is unavailable (i.e. the mandatory requirement to achieve a minimum 10% BNG cannot be achieved within the red-line boundary of a development site) and developers need to meet their BNG commitment by ‘buying-in’ BNG from a third party.

The same arrangement is easily plausible with MNG, with biologically rich and diverse marine environments being established in the best ecological places for them (which may be outside of the red-line boundary of a marine development) and the value in that marine biology bank being sold to developers that need to achieve MNG.

One of our clients who is exploring a collaborative approach to MNG is ARC Marine.

ARC Marine has developed a plastic free, carbon-neutral technology that it utilises in a line of specifically developed products, including reef cubes®, Marine Matts and Intertidal reef cubes®, allowing a variety of marine industries to leave a lasting positive impact on the environment where they would not have otherwise done so.

ARC Marine’s flagship products are designed to support and protect life on the sea floor. Manufactured entirely from marine-friendly materials, ARC Marine is offering a form of scientifically backed construction that is kind to the environment and enhances biodiversity.

Another client of ours in the blue sector is growing a network of scalable, offshore regenerative ocean farms or, as they like to call them, “algapelagos“.

Co-Founded in 2021 by three times world record holder, Olly Hicks, Algapelago secured the largest licence for kelp cultivation in the UK. Based in North Devon, the first Algapelago regenerative ocean farm (ROF) is positioned for optimal growing conditions and minimal spatial conflict. As well as growing kelp and shellfish, a key focus for the Algapelago pilot farm (and all future farms) is to convert the seaweed biomass grown into ready products, such as feed additives for livestock and crop bio-stimulants.

Our Q&A with Mollie Gupta of WWF (on pages 5 and 6 of this publication) highlights some of the benefits of seaweed farming, both in terms of the positive impact that it has in the ocean and in the way that seaweed products can be used to support increasingly in demand food systems.

Finally, Waterhaul is improving the marine environment by recovering ‘ghost gear’ from the coastline and recycling it into designer eyewear. Ghost gear (lost or discarded fishing gear at sea) is abundant, strong and durable (it can last for up to 500 years in the ocean) and costly for fisherman to dispose of.

These qualities have an incredibly detrimental impact on the environment, frequently resulting in ghost fishing where marine life gets trapped and entangled and attracts more species, but make it an excellent recycled, raw resource.

By creating a circular economy pathway for fishing gear, Waterhaul are able to give this ‘waste’ new value, incentivising recycling instead of disposal at sea.

If you have a growth business in the Blue Sector, we would be keen to hear from you.

In 2022, DEFRA launched a consultation on the principles of Marine Net Gain (MNG). The consultation considered MNG as part of an appropriate regime for putting the marine environment into ‘recovery’ – the sort of language that leaves little doubt about the state of our waters. The consultation proposed that MNG is mandated for certain developments, or infrastructure forming part of development, below the Low Water Mark.

The ambition is to secure “…the responsible and sustainable growth of marine industries”, putting biodiversity at its core whilst recognising the wider, additional environmental services. The proposals in the consultation set out that MNG would operate alongside existing planning policy and practice, and provide the tools for offsetting impacts from development that cannot be avoided, minimised or mitigated (the mitigation hierarchy).

The Aims of the Consultation

The consultation recorded that MNG will:

1. “secure positive outcomes for the environment by contributing to halting and reversing the longer-term trend of biodiversity decline through restoration and creation of healthy and high-quality marine and coastal habitats, and protection of species”
2. “deliver lasting improvements, contributing to ocean recovery, supporting efforts in climate change mitigation, resilience and adaptation”
3. “enable responsible and sustainable growth of marine industries and development activities, recognising their essential contribution to meeting the UK government’s climate change commitments, whilst ensuring the protection of our marine environment”
4. “define strategic objectives and goals, increasing the potential for relatively small interventions to make a more significant collective contribution to improvements in the overall status of the marine environment”.

MNG Principles

The consultation put forward 9 Principles for MNG. It is intended that those principles will inform an assessment framework, adopting a mandatory “nature first approach” that will be proportionate and appropriate to the scale and type of development. It is worth highlighting several of these principles.

Principle 1 – “Marine net gain will measure impacts on habitats and species.”

A focus on species as well as habitats reflects that the marine environment is highly dynamic and the species highly mobile.

Principle 2 – “Marine net gain will seek to incorporate environmental benefits underpinned by biodiversity”.

Recognising that biodiversity enhancement and habitat restoration can also deliver additional benefits or ecosystem services, e.g. water purification, coastal protection and carbon sequestration.

Principle 5 – “Marine net gain requirements will be proportionate and appropriate to the scale and type of development”

The consultation highlights the challenges of delivering a fully comprehensive framework and the delay that this will have on establishing a MNG regime. To tackle this (initially, at least) a contribution-based approach is proposed which would “operate like a levy on marine development” and be used to fund priority environmental enhancements or restoration projects.

Principle 8 – “Marine net gain will incentivise the delivery of strategic interventions in addition to meaningful site-based interventions.”

DEFRA anticipates that a directory of designated strategic interventions informed by the MNG principles will be established. The consultation set out that interventions could also incorporate non-statutory opportunities and referred to the Environment Agency’s Restoring Seagrass Meadows, Salt March and Oyster Reef (ReMeMaRe) project.

The Consultation Responses

Following a Freedom of Information Request, in January 2024, the full responses to the consultation were made public. There was broad agreement with the introduction of MNG and the principles proposed. A few themes from the responses included:

• concerns around increasing levels of uncertainty and an increased regulatory burden without addressing the main threats facing the marine environment
• the practical challenges of assessing and monitoring species as well as habitats
• concerns regarding how to develop a robust and appropriate metric to quantify residual impacts of marine development
• calls for a simplistic approach to deliver marine restoration, recovery and enhancement whilst avoiding additional layers of complexity
• questions over whether developments which deliver low carbon energy should have their wider climate change benefits assessed as part of an “environmental net gain” approach
• the need to address onshore pollution which significantly impacts and undermines marine restoration efforts and in particular, intensive agricultural
• the need to recognise marine activities that have significant and long-lasting impacts on the marine environment but which are likely to fall outside of the scope of MNG, including fisheries and shipping
• the need to consider a wider environmental net gain approach and in particular the impact on the British Energy Security Strategy to deliver 50GW of offshore wind by 2050.

The Future Fisheries Alliance (WWF, RSPB and the Marine Conservation Society) advocated for MNG to be integrated into a “holistic vision for our seas”. The Alliance points out that the fishing industry is a key beneficiary of MNG and stated in their response:

“Continuing to consider fisheries and aquaculture in a silo, removed from other marine industries and separated further by its lack of inclusion in a potential marine net gain system prevents its integration in a strategic vision for our seas, which considers all impacts, and ultimately limits Government’s ability to consider joint solutions to remove pressures on the marine environment.”

The Government’s Plans for MNG

As a result of the consultation, the UK Government has confirmed that it will (amongst other things):

1. include impacts on both habitats and species within the MNG assessment framework
2. recognise wider environmental benefits when assessing MNG interventions but only where they are underpinned by biodiversity enhancement
3. explore a selection of options for a contributions based approach alongside work to explore the applicability of biodiversity metrics to the marine environment
4. work with stakeholders to develop a process for assessing MNG and a basis for contribution, taking into account the level of impact
5. not include fisheries within the scope of MNG requirements.

Next for MNG

The Government has confirmed that it will now commission the evidence needed to take the proposals forward. Stakeholders will be invited to contribute to the policy development.

Going forward, a robust assessment framework is to be developed adopting a contributions-based approach and a “suitable simple metric” to assess impacts and interventions to the marine environment.

Seaweed, a marine alga typically found in coastal areas, forms part of the rich biodiversity within the Earth’s waters. The plant-like organism is well known to have a number of environmental, ecological and economic benefits for the planet. It should come as no surprise that it is now therefore a key focus area for tackling marine biodiversity loss and climate change mitigation and adaptation globally. In many countries, seaweed farming practices are already commonplace. Given the known potential benefits, seaweed farming has also become increasingly popular in the UK over recent years. This is notwithstanding the complex regulatory framework within which seaweed farming currently sits.

Global environmental charity, WWF, is one of the key organisations actively supporting seaweed farmers in the UK and undertaking vital research in this area. Mollie Gupta, Seaweed Solutions Project Manager at WWF, provides some exclusive insight into the seaweed industry and the work she is involved in.

What is your role at WWF?

I am the Seaweed Solutions Project Manager, which means I coordinate with all partners to ensure delivery of our wider strategy and programme of work. This work seeks to support seaweed farms to deliver environmental benefits in the UK, both from the point of view of seaweed farms having positive impact in the ocean and from the way that seaweed products can be used to support wider food system transformation.

What does the global and UK seaweed farming industry currently look like?

Seaweed aquaculture is already prevalent in many places around the world. The main producer regions include China, Japan, South Korea and Indonesia. Seaweed is often integrated into the cultures of some of these nations and seen as a delicious food ingredient.

In contrast in the UK, it is little known that before the industrial revolution, we actually used seaweed for years in farming, pharmaceuticals and textiles. Most of this seaweed came from wild harvesting. In recent years there’s been interest in seaweed farming and we’ve seen the number of farms grow significantly in the last 10 years; an exciting trend that we hope to see continue.

Why is seaweed farming considered “regenerative”?

Growing seaweed does not require any pesticide, fertiliser, freshwater, or feed. This makes it drastically different to many other forms of food and biomass production, which usually require significant input. In addition, seaweed grows quickly, is diverse in nutrients and uses, and can be combined with other forms of aquaculture such as shellfish cultivation.

Seaweed farms are able to reduce local acidification problems, help with eutrophication, and can support biodiversity by turning empty water columns into a 3D forest. For these reasons we consider it to be regenerative for the environment.

As well as helping to regenerate the ocean, seaweed farms can be supportive to local communities by offering jobs, supporting local tourism, and providing connection to the coast.

Why is WWF particularly interested in seaweed farming?

WWF is particularly interested in regenerative seaweed farming’s ability to bioremediate excess nutrients – such as run off from agriculture and pollution from sewage. Such seaweed could then, once harvested, be used as biostimulant and returned to field to help support crops to grow, reducing the need for synthetic fertilisers. This is just one example of how seaweed in the UK could support circularity in our food system and reduction in nutrient inputs, especially as we know nitrogen is a problem in our freshwater systems.

There are other innovative uses of seaweed which we are interested in, including seaweed as a possible feed protein in the future. We are working with Oceanium to see if it is possible to extract high quality protein from UK grown seaweed species, which matches other feed proteins like soy and could therefore one day help to displace these. This is an example of how our overseas land footprint and carbon footprint could be reduced by seaweed innovation in years to come.

We believe seaweed products could help to displace carbon intensive products such as fertiliser and feed protein, and therefore lead to overall reductions in the GHG emissions from our food system. However, we need seaweed farms to reach a degree of appropriate scale to be able to support these ambitions, and hence our programme is looking to support UK seaweed farming.

Tell us a bit about some of the seaweed projects WWF are working on at the moment?

There is the Oceanuim protein project discussed above. We are also looking at how seaweed biostimulant could help us to reduce synthetic fertiliser use in Norfolk – with project partners such as Norfolk Seaweed, UEA, Cefas, Biotechnica and others.

We are supporting a PhD project at Newcastle University looking into blue carbon cycling on seaweed farms.

We are funding biodiversity monitoring work with PEBL; looking at building the evidence base around the impact of seaweed farms on local ecology.

We have a large research project ongoing called the Value of UK Seaweed which will highlight and illustrate the potential benefits of a future UK seaweed farming sector.

We’ve also recently published social science research with SAMS. And more!

Are there any developments in the seaweed farming world that you have been particularly excited about recently?

There are many! The first harvest of shellfish and seaweed from an offshore wind farm in Sweden is an exciting development.

The recent Scottish Seaweed Industry Association (SSIA) conference was also brilliant and helped to bring the sector together. There are some helpful summary documents on the website which are worth a read.

The recent work published by SAMS which WWF supported and our future Value of UK Seaweed work which I have linked above are also significant.

What advice would you give to someone looking to enter the seaweed farming industry today?

This is an exciting sector with a future full of innovation and discovery. We would really encourage those interested to join the sector to closely consider the skill-set they can offer, and place this towards an area in need of support. That could be anything from hands on skills on sea farms, to marketing and communications support, to research and evidence building.

To find out more about WWF, visit www.wwf.org.uk.

We reported in November of last year regarding the new Economic Crime and Corporate Transparency Act (ECCTA) which introduced significant changes to UK company law and fundamentally reformed the role and powers of the Registrar of Companies (available here).

As mentioned in our previous report, some of the reforms will not be immediately introduced as they will require system development changes and secondary legislation. The first set of the proposed changes and the relevant draft regulations were recently announced by the government which we summarise below:

Registered Office Address, Registered Email Address, Confirmation Statements and Improving Quality of Data at Companies House – changes from 4 March 2024:

• All companies will need to supply a registered email address which Companies House will use to communicate with the company; it will not be available to the public. New companies will need to give a registered email address when they incorporate, whilst existing companies will need to give a registered email address when they file their next confirmation statement, with a statement date from 5 March 2024 onwards.
• There will be new rules for registered office addresses, meaning companies must have an appropriate address at all times (a PO Box address will no longer be acceptable); Companies House will take action against companies that do not have an appropriate registered office address.
• Companies will need to confirm on their annual confirmation statements that their future activities will be lawful; this will apply to all confirmation statements with a statement date from 5 March 2024. When incorporating new companies, confirmation that the company is being formed for a lawful purpose will also be required.
• Companies House will have broader powers to oversee company creation and ensure more reliable data; this will include more power to check, remove or decline information that seems incorrect or inconsistent with the information already on the register.

Companies House fees increasing from 1 May 2024:

On 19 February 2024, the Registrar of Companies (Fees) (Amendment) Regulations 2024 and the Registrar of Companies (Fees) (Register of Overseas Entities) Regulations 2024 (together the Fees Amendment Regulations) were published and laid before Parliament. The Fees Amendment Regulations amend existing Companies House fees, as well as introducing new fees to reflect amendments made to the Companies Act 2006 (CA 2006). The Fees Amendment Regulations will come into force on 1 May 2024.

In view of the above, Companies House announced they are increasing their fees from 1 May 2024 and published a list of all new Companies House fees.

In their blog published in July last year ‘Reviewing Companies House fees‘, the Registrar explained that their fees cover the cost of the services they deliver and Companies House does not make a profit on their fees.  Further, Companies House said that their fees are much lower than the global average (which have not changed since 2016) and many believe their fees are too low.

Reviews from professionals in certain sectors were mainly positive and some commenting that the increases were justified given the additional responsibilities and new powers provided to the Registrar which will ultimately enable Companies House to deliver a better service and allow access to accurate information on the register.

Companies House to be given power to issue financial penalties

On 19 February 2024, the Economic Crime and Corporate Transparency Act 2023 (Financial Penalty) Regulations 2024 (Financial Penalty Regulations) were published. The Financial Penalty Regulations will introduce the new civil penalties regime under the ECCTA. This means that Companies House will be given power to impose financial penalties on a person for offences under the CA 2006 instead of bringing criminal proceedings against that person.

Companies House will have discretion as to pursue a financial penalty (maximum fine not exceeding £10,000) or pass to law enforcement to consider criminal sanctions.

If the Financial Penalty Regulations are made on or before 1 May 2024, they will come into force on 2 May 2024. If they are made after 1 May 2024, they will come into force on the day they are made.

Company and Business Names/Objections to a Company’s Registered Name

On 20 February 2024, the government announced that it is introducing new laws which will affect the Company Names Tribunal – Notice: Changes to Companies Act 2006 which impact the Company Names Tribunal (Notice).

The ECCTA includes a package of reforms to strengthen the company and business names regime under the CA 2006. There will be amendments to section 69 of CA 2006 to expand the Registrar’s control over names as follows:

• section 69(1)(b) of CA 2006 is being amended so that an applicant can object to the respondent’s use of a challenged named in any jurisdiction (i.e. not only the use of that name in the United Kingdom) which would likely mislead members of the public in that jurisdiction;
• section 69(3) of CA 2006 is being amended to allow members or directors (at the time the challenged name was registered) to be joined as respondents with the company;
• section 69(4)(b) of CA 2006 is being repealed in its entirety so that a defendant will no longer be able to defend the challenge against a registered company name on the basis that the company (i) is operating under the name, or (ii) is proposing to do so and has incurred substantial start-up costs in preparation, or (iii) was formerly operated under the name and is now dormant.

There are no related transitional provisions under the ECCTA for the above changes, particularly, there is no provision for the repealed law to continue to apply in certain cases. The government aims to introduce this change on 4 March 2024, but this is subject to Parliamentary timetables. The Tribunal will publish the implementation date via an update to the Notice as soon as it is confirmed.

Conclusion

It would seem from the announcements and draft regulations published this February alone, the government and Companies House are moving swiftly to introduce the sweeping reforms of the ECCTA. We are monitoring the developments and will publish further updates as and when new measures are announced by the government. Companies House also has a dedicated website in relation to the reforms, where it will be sharing further updates in due course: https://changestoukcompanylaw.campaign.gov.uk/.

Michelmores has a dedicated Corporate Services team led by experts in the field of Company Law Compliance and Corporate Governance. The team will be happy to speak with you if you want to know more about the changes introduced by the ECCTA and how this will affect your business. Corporate Services | Michelmores

What is ESG?

Environmental, social and governance (ESG) is an overarching term that encompasses the focus upon a company’s performance in regard to environmental, social and governance challenges.  ESG considerations have come to the forefront of businesses’ strategies. This is due to the heightened awareness of the impacts of climate change and the wider shift in views on the importance of corporate social responsibility. ESG is, therefore, increasingly demanding the attention of the legal world, as firms seek to support and advise clients through their transition to a more sustainable and positive future.

During my first seat at Michelmores, I have gained a greater understanding of the pertinence of ESG issues across all areas of legal practice. It is exciting to see how teams across Michelmores are engaging collaboratively to solve ESG issues for clients and aspiring lawyers will need to get to grips with the broad range of challenges faced in this regard.

This article focuses on the “E” in ESG: It highlights some (but by no means all!) of the key practice areas through which a trainee solicitor at Michelmores can get involved in environmental and sustainability work during their training contract.

1. Real Estate

Approximately one-quarter of UK carbon emissions are generated from the built environment[1]. The real estate sector, therefore, faces major challenges in the transition to net zero, including the development of energy-efficient commercial property and the decarbonisation of existing building stock.  Developers, owners and occupiers are increasingly scrutinising the ESG credentials of their properties, which has led to heightened due diligence on buildings’ societal, wellbeing and biodiversity benefits. An example of these heightened concerns in practice is evidenced in the growth of green leases.

ESG considerations remain present in all stages of the conveyancing process. For example, Landowners looking to sell their land are now also considering the future value of the land’s natural capital potential. Overage provisions, traditionally used in conveyancing to provide for additional payments to the outgoing landowner if the value of the land increases in the future (such as on the granting of planning permission), are now being drafted to provide sellers with a portion of any revenue generated through future natural capital schemes.

Real estate, therefore, represents a key area through which legal professionals can advise clients on navigating environmental concerns and opportunities, and a good seat choice for aspiring solicitors wishing to upskill on ESG issues.

2. Planning/Projects

The passing of the Environment Act 2021 (EA 2021) has increased the obligations on planning authorities to consider the environment and the sustainability impacts of large projects and developments when assessing planning applications. A key example of this is the requirement for almost all new developments to produce a 10% uplift in biodiversity, known as biodiversity net gain (BNG). In practice, BNG and other statutory environmental protections are set out in s.106 agreements and conservation covenants between landowners and local authorities or responsible bodies. Clients require legal advice throughout the planning process to ensure compliance with new environmental regulations that now form part of wider planning requirements.

3. Agriculture

Agricultural land has become central to developers’ strategies to fulfil habitat conservation obligations via the purchase of off-site BNG, carbon or nutrient “credits”. Lawyers draft bespoke agreements that reflect the unique circumstance of the land involved and protect the interests of different stakeholders entering into environmental habitat schemes. Michelmores works closely with agricultural landowners and investors to advise on the merits and risks of such schemes.

At Michelmores, the exciting sustainability-focused legal work that is involved in the agricultural sector  is further evidenced by our Sustainable Agriculture team. The team has provided advice on cutting-edge sustainable agricultural practices for clients – including work for WWF to produce a report into the use of insect protein in UK farm feeds (which you can read more about here).

Agricultural law is an interesting and important aspect of wider environmental progress and an area that I would recommend to trainees hoping to gain exposure to sustainability initiatives in their training contract.

4. Corporate and commercial law

The financing of environmental projects and the commercial contracts that underpin them both represent further areas of law through which trainees can get exposure to environmental and sustainability work. This includes advising on corporate structures, drafting sale and purchase agreements for BNG credits, and drafting the contracts governing roles and responsibilities of stakeholders involved in habitat generation projects.

The success of future environmental projects will require the aid of private funding and an understanding of corporate and commercial mechanisms. Contracts for environmental schemes are often complex agreements that deal with the fast-paced change of environmental legislation. A strong understanding of contract law is therefore essential for aspiring lawyers hoping to progress their ESG legal credentials and seats in corporate and commercial teams will be valuable.

Further thoughts – the diversity of ESG work in law:

The above sectors represent just some examples of the areas of law through which a trainee solicitor at Michelmores can experience environmental and sustainability-focused legal work. The diversity of these areas demonstrates the benefits of experiencing varied seats during your training contract, as this will help improve your understanding of the different facets of ESG challenges faced by clients.

[1] UK GBC, Climate Change Mitigation Climate Change Mitigation | UKGBC

Getting job descriptions right

In my recent article about the need to take sponsor licence compliance obligations seriously, I analysed the case of Prestwick Care, a large care home operator in the North East, which lost its High Court challenge of the Home Office’s decision to revoke its sponsor licence.

It employed 219 sponsored workers out of a total headcount of 857 staff, and was found to have defaulted in a total of 31 instances across seven categories of compliance duty. Amongst these defaults were five employees who were sponsored as Senior Care Assistants under SOC code 6146, but whose actual duties did not match the job descriptions contained in their certificates of sponsorship. This led to a finding that they were not occupying genuine vacancies, a mandatory ground for revocation.

Hot on its heels comes another case, Supporting Care, which had an opposite result with the High Court quashing the Home Office decision to revoke its sponsor licence. But sadly this is not a major cause for celebration, as I explain below.

Supporting Care is a large domiciliary care provider registered with the Care Quality Commission, which has contracts with the NHS and local authorities allowing it to provide homecare to vulnerable and elderly individuals across several London Boroughs. Before revocation it had 68 sponsored workers out of a total workforce of 162 employees.

The Home Office visited the company’s premises on 3 April 2023 and on 11 May 2023 suspended their sponsor licence on the basis that they had identified defaults in respect of six categories of compliance duty. They issued a notice of revocation on 26 June 2023 but by the time the case came up for hearing in November 2023 the breaches had been whittled down to one area, relating solely to one employee, who was sponsored as a Senior Care worker.

Having interviewed the employee, the Home Office were not satisfied that her actual duties matched the job description on her certificate of sponsorship (CoS) or that her role represented a genuine vacancy, for example because the CoS contained an exaggerated or incorrect job description. Either of these breaches gives rise to a mandatory ground for revocation.

So the entire basis for revocation depended on a detailed analysis of the job description in her CoS and the Home Office’s assessment whether it matched her actual duties or was exaggerated or otherwise incorrect.

There were eight duties listed on her CoS and the employee was found not to be undertaking two:

• liaison with team managers and carrying out care plans for residents; and
• allocating shifts and rotas.

The Court was faced with the task of deciding whether ‘six out of eight’ meant that her actual role did not match her CoS job description, thereby triggering mandatory revocation.

In trying to find a balance between the inherent failings of a purely literal and strict approach compared with an interpretation that was too broad and allowed for substantial or significant variances, it found that:

“… the question of whether the role undertaken by [the employee] “matched” her CoS cannot be properly decided simply by counting off from the CoS list of duties, but instead requires a qualitative assessment of the duties.”

After carrying out an “objectively undertaken qualitative assessment” it concluded that the two “missing” duties were substantial and/or significant and her role did not therefore match her CoS. The mandatory revocation was therefore likely to be upheld by the Court.

However that was not the end of the matter. One of the grounds of challenge that Supporting Care had argued was that the Home Office had failed to conduct an adequately reasoned global assessment of all relevant considerations in deciding whether to revoke or downgrade the sponsor licence. In plain English, they had not considered what impact the revocation would have on the other 67 migrant workers and their families, the vulnerable individuals under care, the company itself and the wider industry. They had also failed to consider whether revocation was a reasonable and proportionate response to a single breach of compliance duty relating to the role of a single employee from a workforce of 162 workers.

This “impact” argument found favour with the Court, who used it to justify the quashing of the decision to revoke the licence. The policy that said that revocation was mandatory even for a single event of default was, in the circumstances, too harsh an outcome.

This was an exception to the normal rules, however, based on (1) the particular circumstances of Supporting Care and (2) that the Home Office had failed to explain why it was reasonable and proportionate to revoke their sponsor licence. The Home Office will no doubt be vigilant in the future in addressing “impact” arguments whenever a licence holder is litigating a revocation decision.

What is abundantly clear here is that the Home Office is prepared to pursue enforcement action even when there is only a single default of a mandatory ground.

Prestwick Care had also put forward an ‘impact’ argument, but had failed because it didn’t have the foresight to present the argument before the revocation decision had been made, a vital omission when launching a judicial review. And it is no surprise that its numerous breaches of sponsor duties, when considered against the single breach by Supporting Care, justified the revocation of its sponsor licence especially when the judge presiding over its case found that Prestwick Care“… could not be trusted to comply with its duties as a sponsor”.

Reports are rife that the Home Office has increased compliance enforcement action in the care sector and they are paying particular attention to whether the actual duties performed by sponsored care workers ‘match’ the job descriptions in their CoS.

Alongside the enforcement action, the Home Office is also demanding more detailed information when sponsors apply for Defined certificates of sponsorship (necessary when intending to sponsor a migrant worker who is living overseas). Amongst other things, they are asking for details of the business rationale, copies of current contracts to demonstrate that the business has genuine vacancies, staff rotas and copies of employment contracts.

So, what can we take-away from these two cases and the increased compliance enforcement?

Firstly, take your compliance duties seriously. The Home Office have a very low threshold for initiating enforcement action.

Secondly, pay particular attention to your choice of SoC code, to make sure that it is the most appropriate in the circumstances.

Thirdly, draft your job descriptions carefully and make sure that they are an accurate reflection of the actual duties of the job roles to be undertaken by the migrant workers.

Fourthly, be careful when entering the job description into the CoS – especially when entering the summary, which is limited to 1,000 characters and often is not enough to contain the entire job description.

Finally, and most important of all, review your existing choice of SOC codes and compare the actual duties of each sponsored worker against their job description contained in the CoS, and take remedial action in relation to any non-compliant job descriptions.

Before you embark on the journey to become a sponsor, it is essential that you ensure that you have the necessary people, policies and procedures in place to lawfully maintain the licence at all times during its life-span.  For those already in possession of a sponsor licence (even if you do not currently have any sponsored individuals working for you), ensure that you are regularly checking that you are satisfying all of your sponsor licence obligations.  We can draft and review policies, train staff, conduct compliance audits and even act as your Level 1 User to make sure you never suffer a similar fate to Prestwick Care or have to go through the pain and expense of the High Court legal action that Supportive Care had to endure.  If you need guidance, help or reassurance on sponsorship, please get in touch with the Michelmores Immigration team.