Quick facts about Section 106 agreements

Section 106 agreements are legal agreements between developers and the local council. They can often release funding to deliver projects within a local area and are designed to:

  • ease the impact of a new development on the local community.
  • compensate the local community for any impact caused by a development - for example if open space is lost.
  • help shape the new development - for example ensure a certain number of houses are affordable homes.

Section 106 agreements are:

  • often known as planning obligations.
  • legally binding agreements between developers /landowners and the local planning authority (or council).
  • occasionally involved in other parties, made using powers contained in Section 106 of the Town and Country Planning Act 1990 (as amended).
  • linked to the grant of planning permission.
  • binding on the land to which the permission relates and whoever owns it, so they pass from owner to owner if the land is sold.

Section 106 agreements should always:

  • be directly related to the proposed development.
  • be fair and reasonable in scale and kind to a proposed development.
  • be reasonable in all aspects and make a proposed development acceptable in planning terms.

Other bits worth knowing...

  • Every agreement will be different and reflect the development it relates to.
  • With the agreement of the council, developers may make payments, or take certain actions - for example install a play area.
  • If a development doesn't go ahead, the Section 106 agreement will not be implemented.

To find out more, visit our Section 106 homepage.