Welcome to the summer edition of the Clyde & Co
Real Estate Bulletin, prepared by members of our
real estate team. Our bulletins are aimed at keeping
you up to speed with recent key developments in
the real estate industry.
In this issue we look at what happens to provisions for future works paid
by a tenant if it exercises its break option part way through a service
Next we look at the issue of abandoning an easement, and consider the
recent case of Dwyer v Westminster City Council (2014) EWCA Civ 153.
We then comment on anti-competitive provisions in commercial leases: the
first reported case has found a restrictive user clause in lease to be anticompetitive
Next we follow on from our discussions in a previous edition on the case
on Marks & Spencer PLC v BNP Paribas. M&S successfully argued that there
was an implied contract term giving rise to a right to recover overpaid
rents following the exercise of the break clause. However this decision
has now been reversed by the Court of Appeal. Likewise the Court of
Appeal have reversed the Judge’s decision in the case of Friends Life
Limited v Siemens Hearing Instruments Ltd (2014) EWHC B15 (Ch) and found
that a break notice must strictly follow all conditions of a break clause,
no matter how trivial.
Finally, we look at the future of fracking.
If you would like further information on any of the issues raised in this
newsletter please contact at firstname.lastname@example.org.
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What happens to provisions for future works paid by a
tenant if it exercises its break option part way through a
service charge year?
The recent case of Friends Life Management Services Ltd v A&A Express Building Ltd 
EWHC 1463 (Ch) provides a useful insight on whether payments made in advance by
a tenant can be used in relation to works carried out in the same service charge year
but after the lease has ended by operation of a break clause.
Friends Life Management Services was the tenant of part
of a commercial building. The lease was successfully
terminated by operation of the break clause on 24
March 2010. Service charge was payable by the tenant in
advance of the landlord’s anticipated costs for the service
charge year which ran from 1 January to 31 December.
When calculating the service charge costs, the landlord
was entitled to include a sum by way of provision for
anticipated expenditure in any future service charge year.
Provisions for future expenditures had been made
between 2006 and 2009 totalling GBP 875,000. The landlord
eventually carried out major works to the premises costing
around GBP 1 million but the works did not start until late
2010, after the lease had been terminated, and continued
What can be charged by the Landlord in the last
service charge year?
The Court found that the last service charge year ended
on 31 December 2010 and not on the date when the lease
was terminated. As such, costs actually incurred by the
landlord in 2010 could be included in the last service
charge account. In other words, the tenant would have to
pay for works carried out after the break date, insofar as
these works were payable by the landlord during the last
service charge year. In this case, the parties agreed that the
costs incurred would be apportioned so that the tenant
would only pay a proportion relative to the period up to the
end of the lease.
The landlord argued that the service charge should also
include a provision for anticipated works in 2011 on the
grounds that it would have been able to do so had it not
been for the tenant exercising its break. The Court rejected
this argument on the basis that the landlord was not able
to do so in the last year of the contractual term and that
the position was no different whether the lease had been
terminated early by operation of the break clause or by
effluxion of time.
What happens to the provision for future
expenditures already paid by the Tenant?
The landlord argued that the provision built up over
previous years should be credited against the costs actually
incurred in the last service charge year. If the provision
exceeded these costs, the latter would be reduced to nil
but the balance would not have to be repaid to the tenant.
The tenant on the other hand contended that the provision
should be credited against the service charge payable in the
last service charge year and if it exceeded this amount the
balance ought to be repaid by the landlord.
The Court held that the whole provision had to be brought
into account in the last service charge year. The works
for which provision had been made should be matched
with the costs actually incurred in 2010 for those works.
If the whole provision was not used, the balance should
be credited against other costs actually incurred by
the landlord. If there remained any excess after that, a
proportion should be repaid to the tenant having regards
to the time in which the tenant remained in occupation
during the last service charge year.
Impact of the case
Landlords need to be aware that, subject to any express
provision to the contrary, they are likely to have to repay
any unspent service charge provision to the tenant at the
end of the lease. They may therefore want to consider lease
expiry dates and break dates when planning major works
to ensure that the costs relating to these works is incurred
in the final service charge year so that they can be charged
to the Tenant.
An issue that the Court did not address in this case is
whether the tenant is entitled to the full amount of
unspent monies if the lease had previously been assigned
and successive tenants contributed to the service charge
provision. This is something that a tenant assigning its
lease shortly before the end of the term or break date may
want to consider and provide for in the assignment.
T: +44 (0)20 7876 5561
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Abandoning an easement?
An easement is a right to cross or otherwise use someone else’s land for a specified purpose. The Court of Appeal considered abandonment of an easement in the recent case of Dwyer v Westminster City Council  EWCA Civ 153.
In 1922 land behind London’s Edgware Road was sold to a company. Access to the site was via a passage way from the main road, and was the subject of an express grant of rights for pedestrians and vehicles.
The company closed in the 1960s, and the Council acquired the site for residential property development. During and following this redevelopment of the site, the access way had fallen out of use, and a trader, Mr Dwyer, working out of the adjacent Church Street Market blocked the access at either ends and began using the space as a storage depot for his business goods. The non-use of the access route continued for 40 years, and in 2007, having used the site since the sixties, Dwyer applied for and obtained title to that land by adverse possession.
Intending to redevelop the site, in 2010 the Council requested of Dwyer that he reinstate the access route as it was going to be needed. Dwyer refused, asserting that the Council had abandoned the easement.
The Judge at the High Court proceedings concluded that the route had been partially abandoned by “lessees and tenants, owners and occupiers”, since the Council development of the sixties had been designed without any intention of the occupiers to make use of the right, but that “the purchaser and his assigns” had not forgone their right in regard to the access way.
Court of Appeal decision
The Court held that the Judge had been wrong in principle to conclude that there had been, or indeed could be, a partial abandonment of a right of way by reference to different classes of users. The right is attached to the land, and is not granted to a person or any class of person.
The Court then reasserted the principle that no abandonment of a right of way will be implied merely from non-use. This is a crucial and inflexible principle, and in referring to the case of Benn v Hardinge (1993) 66P&CR 246, the Court could exemplify the extent to which this principle will be taken, as in that case, a 175 year period
of non-user did not amount to evidence of an intention
In dismissing Dwyer’s case, the Court of Appeal has had the opportunity to show quite how reluctant the courts will be to infer that a party has forsaken rights over land in exchange for no benefit. They have also established the test, of four elements, which must be used in future cases considering the abandonment of easements:
1) The intent to abandon is not subjective, but a question of fact drawn from the circumstances
2) A reasonable owner of the servient land must have been shown that the dominant land’s owner never intended for either himself, or his successors, to assert that right again
3) Abandonment is not to be lightly inferred
4) Non-user alone is not enough
Where an easement over land exists, the courts will be very reluctant to draw the conclusion that there has been an implied intention to abandon that right, and they will categorically not forsake that right based on nothing more than mere non-user, irregardless of the length of the period of that non-user.
If an easement is to be declared abandoned, it must be established that the owner of the dominant land evidenced a fixed intention that he would never again try and assert that right, nor would he ever attempt to transmit it to another. Furthermore, the burden of proof lies upon the party attempting to establish that the right has been abandoned.Mike Lewis
T: +44 (0)20 7876 5389
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Anti-competitive provisions in commercial leases: first
reported case finds restrictive user clause in lease to be
anti-competitive and unenforceable
Since 6 April 2011, the rules in Chapter 1 of the Competition Act 1998 (‘Chapter
1’) have applied to all land agreements (including commercial leases). The rules
prohibit any agreements which have the effect of preventing, restricting or distorting
competition within the UK. Any such agreements are unenforceable and will be void.
Importantly, there is an exemption to this if an agreement is ultimately shown to
create benefits to consumers that outweigh its anti-competitive effect.
Until recently, OFT Guidance on the application of Chapter
1 to land agreements has been the only advice available to
landowners and there has been uncertainty as to how the
court would interpret the rules. Martin Retail Group Limited v
Crawley Borough Council is the first reported case concerning the
application of Chapter 1 to a restrictive user clause in a lease.
A dispute arose in the context of lease renewal
negotiations. The tenant claimant, Martin Retail Group
(MRG), had operated a shop as a newsagent since 2001.
Under its existing lease, MRG was permitted to use the
shop only for the retail trade of newsagent, tobacconist,
confectionary, stationery and the sale of books, toys,
records, fancy goods and greeting cards. The shop was
situated within a parade of eleven local shops owned by
the defendant local authority, Crawley Borough Council
(the Council), and operated as a letting scheme. One of the
other shops in the parade was a grocery store, permitted
to sell alcohol. On renewal of its lease, MRG requested a
wider user clause which would permit it to sell alcohol and
convenience goods at the shop.
The Council objected on the basis that there was already
a convenience store on the parade selling these goods
and the Council’s letting scheme promoted different
uses for each of the shops. It proposed an alternative,
narrower clause limiting the use to the existing newsagent
MRG claimed that the user clause proposed by the Council
was in breach of Chapter 1. The Council conceded that
the use restrictions could have the effect of restricting
competition in the sale of convenience goods on the parade
within Chapter 1 but sought to rely on the exemption. It
contended that ensuring the availability of a number of
different retailers at the parade was a benefit to the local
community and that the restrictions were necessary to the
letting scheme as without them small traders would not
come to the parade. It argued that this benefit satisfied the
criteria for exemption.
As the Council had already conceded that the use
restriction could be anti-competitive under Chapter 1, the
County Court only ruled on the issue of the exemption. It
held that, on the facts, the Council had failed to provide
sufficient evidence to show that the criteria for exemption
had been satisfied. Consequently, the Council’s proposed
user clause in the lease would contravene Chapter 1.
In reaching its decision the Court consulted and endorsed
the OFT Guidance praising it for its practical approach.
Interestingly, the judge commented that the position
might have been different if the letting scheme was being
established from scratch and the restrictions were to
support an anchor tenant until that tenant’s business
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Martin Retail Group Limited v Crawley Borough Council may
only be of limited use as it did not consider the application
of the Chapter 1 prohibition directly, focusing instead on
the conditions for exemption. However, as it is the first
recorded case on the application of Chapter 1 to retail
leases it will be of interest to both landlords and tenants.
Whilst only a preliminary hearing in the County Court,
this case does perhaps give an insight into how the higher
courts will approach arguments based on competition law
in the future.
In the vast majority of leases, restrictions on a tenant’s
use of the property will still not amount to a breach of
competition law (the Martin case concerned a very small
“market” for competition law purposes). However, tenants
will undoubtedly use this decision as a negotiating tool to
argue against restrictive user clauses, both in the context of
new leases and lease renewals. Landlords should no longer
ignore competition law based arguments.
T: +44 (0)20 7876 5433
Tough break for tenants
It is common where commercial leases contain rights to break in favour of the tenant,
that the terms of the lease will make those rights conditional. One such common
condition is the tenant has to ensure that all rents due under the lease have been paid
in full by the break date.
Where the break date falls part way through a quarter,
it has long been settled law that on the quarterday
immediately prior to the break date, the full quarter’s
rent is payable and there is no right to apportion and pay
only the rent for the period prior to the break date either
under Common Law or under the Apportionment Act 1870.
This is galling for tenants who find themselves paying for
premises beyond a point in time when the lease has come
to an end, and it appears to be something of a windfall for
landlords. Unsurprisingly therefore, tenants have sought to
argue in favour of rights to recover overpaid rent after the
lease has come to an end by virtue of the operation of the
The latest such effort on the part of a tenant has been
seen in the High Court in Marks & Spencer PLC v BNP Paribas,
where the tenant successfully argued that there was an
implied contract term giving rise to a right to recover
overpaid rents following the exercise of the break clause.
That approach has now been roundly rejected by the Court
Over the years courts have grappled with various tests for
the implication of contract terms. However, in Attorney
General of Belize v Belize Telecom Limited, Lord Hoffmann
explained that the implication of contractual terms was
part of the larger issue of interpreting the contract. He said
“There is only one question: is that what the instrument, read as
a whole against the relevant background, ought reasonably be
understood to mean?” Generally parties to contracts elucidate
what they mean on the printed page, however, if they
intended a contractual term to arise, which they did not
produce in writing, then as part of the construction of the
contract, the Court may imply a term to give effect to that
intention. So far so good.
At first instance in Marks & Spencer PLC v BNP Paribas,
M&S’s arguments in favour of an implied right to recover
overpayments found favour for Mr Justice Morgan, and he
agreed that on the wording of the lease it was appropriate
to imply such a term. He relied upon the following:
1. Clause 2 of the lease concerned payment of rent and
used the words “proportionally for any part of a year”. The
Judge held that this apportionment clause applied
not just to the first day and the final day of the lease
(both of which fell part way through quarters) but
also to the advance payment of rent that post-dated
the break date. The Court of Appeal called this “the
2. A year’s rent was payable as a break premium and
a right to recover overpaid rent ought to be implied
because a reasonable person would consider that the
tenant should be in the same position as a tenant who
had paid the break premium on the last quarter day.
The Court of Appeal called this the “same position
3. Since the break premium amounted to a full year’s
rent, at GBP 919,800 plus VAT, the parties must have
intended for that premium to be the full amount of
compensation that the landlord would receive if the
tenant exercised its right to break. Therefore, it could
not have been intended for the landlord to retain
overpaid rent on top of the break premium, in excess
of GBP 150,000. The Court of Appeal called this “the full
The Court of Appeal unanimously allowed an appeal by
the landlord and rejected the suggestion that the right to
recover overpaid rent should be implied into the lease. The
Court observed that the break clause itself simply provided
for early termination of the lease provided that the
conditions on that right were satisfied. It said nothing about
the treatment of overpaid rent following the exercise of
the break clause. Furthermore, the lease contained clauses
that dealt with the consequences of a successful break
which were entirely silent on the question of overpaid rent.
The Court considered that the parties must have realised
that the break clause fell part way through a quarter and,
having been aware of that possibility, would have expressly
provided in the lease for a right to recover overpaid rent
if that was the intention, since the parties had clearly
considered post-termination issues.
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As for the “same position conclusion” the Court considered
that the landlord would be in a position of some
uncertainty where a tenant has invoked the break by
service of a notice, because until the break premium is
paid then the landlord would not know for certain whether
the lease would be broken. The Court could not see in
principle why the landlord ought not to be compensated
for that uncertainty, such compensation taking the form
of the overpaid rent. Similarly, with the “full compensation
conclusion” the Court did not agree that the payment
of a break premium necessarily meant that the parties
intended no further compensation to be paid to the
landlord. In fact the absence of an express right to recover
overpaid rent could be thought to be evidence that the
parties did intend the over payment of rent to form part of
the landlord’s compensation.
This case is a classic example of how difficult it can be to
predict the outcome of cases that turn on the construction
of documents, since words strike each reader differently.
Each lease is construed strictly upon its own terms and since
two leases are rarely identical, the decision is not a binding
authority applicable to all leases on different terms. There
may be leases in existence where it is possible to imply a
right to recover based on the terms of those particular leases.
However, it is likely that these kinds of arguments will start
to die out. Now that tenants are alive to these issues it is
standard practice for an express right to recover overpaid
rent to be specifically included in break clauses. However, for
those older leases where such drafting does not presently
appear, then this Court of Appeal decision (albeit of persuasive
value only) is no bad thing. The decision promotes certainty
and certainty deters dispute. Better that everybody knows
where they stand and there is less scope for argument. The
overpayment of rent is simply another financial factor to
be weighed in the balance when deciding whether or not to
invoke a break clause.
T: +44 (0)20 7876 5542
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“You need to be best Friends [for] Life with break clause
The case of Friends Life Limited v Siemens Hearing Instruments Limited  EWCA Civ 382
has confirmed that all conditions (even procedural) must be complied with in order for
a break to be effective. This decision overturns the earlier High Court decision 
EWHC B15 (Ch) (see Giving the tenant a lucky break? Real Estate Bulletin: October 2013).
A lease was entered into between Sun Life Assurance
Society Plc (later Friends Life Assurance Society Ltd (“the
Landlord”) and A&M Hearing Ltd (later Siemens Hearing
Instruments Limited (“the Tenant”)) on 27 January 1999
of Premises in Crawley. Under the lease, the tenant could
break the lease on 23 August 2013 (subject to satisfying
certain pre-conditions such as giving vacant possession)
by giving the Landlord no more than 12 and no less than 6
months’ notice. The lease also stated that any break notice
“must be expressed to be given under Section 24(2) of the
Landlord and Tenant Act 1954”.
A break notice was served on behalf of the tenant which
did not make reference to Section 24(2) of the Landlord
and Tenant Act 1954 (“the Act”). It was challenged by the
landlord and the tenant issued court proceedings seeking
a declaration that the break notice was validly served.
High Court Decision
The case was initially heard by a deputy judge of the High
Court. The tenant submitted that its notice was effective
because (amongst other arguments):
a. There was no such thing as a notice under
Section 24(2) and the required formula was
meaningless. Therefore, all that was required on
the proper construction of the break clause was a
straightforward notice, such as the one that was
given, which did not state it was given under Section
24(2) of the Act
b. Even if the break clause did require the stipulated
words to be stated, on its proper construction, the
failure to state meaningless words did not render
the notice invalid
The first instance judge found that the notice was defective
for failing to reference Section 24(2) of the Act but that
this did not render the notice invalid. This was despite the
break clause stating that such notice “must be expressed to
be given under Section 24(2)”.
Court of Appeal Decision
The landlord appealed to the Court of Appeal.
In the lead judgment, Lord Justice Lewison said that “it is
impossible in my judgment to interpret the clause as if it
is said that the notice “must” be expressed in a certain way,
but it does not matter if it is not”. As such, the Court of
Appeal reversed the judgment of the High Court and found
that the notice was defective and therefore invalid.
Reference was made to the case of Mannai Investment Co.
Ltd v Eagle Star Life Assurance Co. Ltd  A.C. 749 in which
Lord Hoffmann said: “If the clause had said that the notice
had to be on blue paper, it would have been no good serving
a notice on pink paper, however clear it might have been
that the tenant wanted to terminate the lease.” This had
been the position before the Court gave its judgment in
the High Court for this case. The Court of Appeal therefore
restored the position.
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The case confirms the position that a tenant needs to
comply with all conditions of a break clause, no matter
how trivial, for it to be effective.
Tenants will be continually and correctly wary of trivial
conditions in a break clause. They will need to ensure
that they comply strictly with even minor conditions and
evidence such compliance. Whilst a landlord may choose
to waive certain errors or non-compliance, where tenants
are breaking their lease in order to achieve a lower rent or a
strategic business move, Landlords are in a position where
they are likely to examine notices and compliance very
carefully to check whether any points might be taken in
order to allege that a break has not been validly exercised.
It is therefore essential for tenants to ensure that all
notices are fully compliant, in terms of names, addresses
etc. and to strictly comply with all conditions in their lease.
As Lord Justice Lewison commented: “The clear moral is: if
you want to avoid expensive litigation, and the possible loss
of a valuable right to break, you must pay close attention
to all the requirements of the clause, including the formal
requirements, and follow them precisely.”
T: +44 (0)20 7876 4299
Rhetoric, relaxing restrictions and the future for fracking
In early 2014, David Cameron boldly announced that the government supported the
exploitation of onshore oil and gas through hydraulic fracturing (fracking) and that
the UK should fully embrace exploration, stating: “I want us to get on board this change
that is doing so much good and bringing so much benefit to North America”. Since then, the
government has announced further tentative steps towards its ambition to realise
shale gas exploration such that it is now one of the governments ‘Top 40’ priority UK
infrastructure projects under the most recent iteration of the National Infrastructure
Latest studies have indicated that supplies of natural gas
which are economically recoverable from shale in the
United States can accommodate the country’s domestic
demand for natural gas (at current levels of consumption)
for more than a hundred years. This is an economic and
strategic boon home and abroad, and at least in the near
term, a potentially important stepping-stone toward
lower-carbon, greener energy. However, as things stand in
the UK currently, unconventional oil and gas exploration
is hampered by a powerful anti-fracking movement and a
cumbersome planning and environmental permit process.
The government is seeking to address both of these hurdles
by a combination of rhetoric and (at least the beginnings
of) relaxation of restrictions. It has also introduced the
most competitive tax regime in Europe for shale gas and in
the Queen’s Speech, the government announced plans to
allow developers to drill under homes without the owner’s
permission. Nevertheless, it remains the case that any
developer wishing to exploit (what is estimated to be) 1,300
trillion cubic feet of shale gas lying underneath British
soil still has a challenge ahead. On 8 May 2014, the House
Of Lords Economic Affairs Committee released a report
stating that development of shale gas resources should be
an “urgent national priority”, blaming the “dauntingly complex”
regulatory framework for the snail’s pace of exploration.
What fracking will mean if given the green light
Work is carried out in three distinct phases: exploration,
appraisal and production. The exploration phase can last
anything from two to six months and involves drilling wells
to identify whether oil or gas can be produced profitably. All
UK shale gas development is currently in this phase.
The appraisal phase is next, and typically lasts from six
months to two years. It requires testing of the deposits
to establish the strength of the resource and its potential
productive life. Finally, the production stage can begin,
when developers can begin profiting from their efforts. This
phase is expected to last a minimum of 20 years. However,
preparing the apparatus and finding a suitable drilling site
is only half the battle. Before the government will grant the
developer a drill consent, numerous other consents and
permissions must first be obtained.
Rights to drill from landowners
Firstly, landowners must agree to drilling underneath
their property. Fracking for shale gas is performed in both
vertical and horizontal wells, and horizontal wells can be
over a mile long. Therefore, a single fracking operation may
require rights to drill under multiple landholdings. As the
law currently stands, drilling without landowner consent
will amount to trespass and opens extraction companies
to the risk of landowners obtaining injunctions to halt the
drilling process. Unlike in the United States, landowners
have little incentive to cooperate with developers as
underground oil and gas belongs to the Crown.
Reports in the press have suggested that opponents of
fracking could obstruct drilling by buying up strips of land,
known as “ransom strips” in a fracking area, giving them
the right to mount legal challenges to drilling. Licensed
developers have the right to seek compulsory purchase of
land required for drilling: however, to date no such order
has ever been implemented. Such proceedings are likely
to be drawn out: the developer must show that the need
to acquire the right is in the national interest, and that the
landowner has been unreasonable in refusing to grant the
right by private arrangement. It is unlikely that landowners
who have refused access to developers will go down
without a fight.
The government is seeking to clarify the position for
developers post Queen’s speech following a public
consultation. Ministers want to establish that energy
companies have the right to run shale gas pipelines under
private land, without breaking trespass laws. This is likely
to be accompanied by a right to compensation for local
Petroleum exploration development licences
Secondly, the developer will require a petroleum
exploration development licence (PEDL). There are
currently 176 PEDLs for onshore oil and gas in the UK and
the Department of Energy and Climate Change is planning
to conduct a new round of licensing in 2014. These licences
confer on the developer an exclusive right to search, bore
for and extract hydrocarbons in the licence area. However,
this licence alone is not enough to start drilling.
Planning permission and environmental
Planning permission is also required from the Minerals
Planning Authority (which is usually the County Council).
When applying for planning permission, the developer
must complete an ownership certificate which provides
details about the ownership of the application site and
confirms that appropriate notices have been served on
landowners. The government has recently signalled its
intention to simplify this process by allowing developers
to apply for planning permission without notifying the
owners of land where only underground operations will
take place. This should be welcome news to developers and
shows recognition by government of the impracticalities
of identifying interests in land over large areas in the early
stages of seeking the various consents needed. As yet,
planning permission has only been granted for exploratory
wells at a small number of sites, with no site being close
The Minerals Planning Authority must also decide whether
an Environmental Impact Assessment (EIA) is required,
on a case-by-case basis. It is unlikely that an EIA will be
required for exploratory drilling operations which do not
involve hydraulic fracturing.
Environmental and health & safety go ahead
Fourthly, permits from the Environment Agency will be
issued to ensure fracking is not harmful to the surrounding
environment. This will be a step heavily scrutinised by
environmental campaigners, who advocate that the
techniques used in fracking could cause small earth
tremors, water contamination and environmental damage.
However, the government claims that if there is any
risk to the environment, the authority will find this risk
unacceptable and not permit activity.
No developer has managed to reach this stage in the
process as of yet: the House of Lords Economic Affairs
Committee’s report pointed out that the Environment
Agency has not received or approved any applications for
the necessary permits since the moratorium on hydraulic
fracturing was lifted in 2012.
Finally, the Health and Safety Executive must be notified
of the well design and operation plan. If satisfied, a well
consent will be granted.
Only when all of these consents have been obtained will
the government grant a drill consent to the developer.
The future for UK fracking – the good and the bad
It’s not all negative news for UK onshore energy operators.
As above, in the government’s bid to go “all out for shale,”
the most competitive tax regime in Europe for shale gas
has been introduced; saving companies an extra 24p in
tax for every GBP 1 they spend on the project. The new
tax breaks are structured so that when a developer starts
making taxable profits from selling gas, it will be taxed at
30 per cent rather than the usual 62 per cent. In fact, new
developers will now have an effective tax rate lower than
The government is also allowing councils to keep all
of the business rates raised from fracking sites, a deal
which is expected to generate millions of pounds for local
authorities. It is claimed this could be worth up to GBP
1.7 million a year for a typical site, funded directly from
central government. This has been vilified by critics, with
Greenpeace accusing ministers of trying to “bribe councils.”
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Whatever your stance, fracking continues to be a topic
for debate, sparking lobbying and protests from
campaigners. However, the government has firmly marked
its position; the production of onshore oil and gas is ‘full
steam ahead’. There is no doubt that post Queen’s Speech
and in the lead up to the Autumn Statement (December
2014), fracking will be a key industry topic. Based upon the
government’s statements so far this year however, industry
leaders will certainly be monitoring these announcements
to see if they signal the end to rhetoric and political
positioning and instead, the start of developer application
approvals and progress.
T: +44 (0)20 7876 4245
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What they say:
“Clients hail this firm as a ‘multi-talented, multifaceted one-stop shop’, a description
borne out by its extensive client list of banks, investors, developers, occupants and
Chambers 2013: Real Estate
“Market sources… say it has ‘a strong reputation in the property industry”.
Chambers UK 2013: Real Estate
“Clyde & Co’s real estate practice is ‘very strong and very broad. Market sources describe
the team’s work as consistently good.”
Chambers UK 2013: Real Estate
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Clyde & Co offices
Offices opening in 2014
37 Offices across
over 1,500 fee earners
and 2,500 staff
For full office details please refer to the Clyde & Co website
Rio de Janeiro*
Dar es Salaam
*Associated offices **Offices opening in 2014
Further advice should be taken
before relying on the contents
of this Bulletin.
Clyde & Co LLP accepts no responsibility for loss
occasioned to any person acting or refraining
from acting as a result of material contained in
No part of this summary may be used,
reproduced, stored in a retrieval system or
transmitted in any form or by any means,
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or otherwise without the prior permission of
Clyde & Co LLP.
Clyde & Co LLP is a limited liability partnership
registered in England and Wales. Authorised and
regulated by the Solicitors Regulation Authority.
© Clyde & Co LLP 2014
Clyde & Co LLP
CC005485 - July 2014