Article – Who Has Rights of Compulsory Purchase and How Do I Protect Myself as a Tenant Farmer?

Many people have heard of compulsory purchase, and it has been a “hot topic” politically in the wake of projects such as HS2. Compulsory Purchase Orders (“CPOs”) are the process by which “Acquiring Authorities” can acquire an interest in land in the public interest and without the consent of the owner or occupier.

There are several types of bodies that can exercise compulsory purchase powers, from Local Authorities to Government departments to Utility companies and executive agencies such as those who, for example, have responsibilities for leading house building projects.

Compulsory purchase of agricultural land can, of course, be a very stressful and disruptive process as it can affect not only your home but also your livelihood. It is therefore important that you know what to do and where to turn if you ever find yourself in the situation where you receive a notice relating to a compulsory purchase which affects land of which you are a tenant.  This can relate to wholesale acquisitions of land, but also to the more minor acquisitions of rights to do works/install cables etc.

The first thing to know is that if you do receive any notice relating to compulsory purchase you should act on this as soon as possible – you may not be able to prevent the process from happening, but you will have the opportunity to negotiate the amount of compensation. You should receive notification from the Authority early on in the process, however if, for example, your lease or the land is not registered at the Land Registry, or if the land that you’re renting does not have a postal address they may not make direct contact with you initially and you may need to contact them to find out more. There are different procedures which must be followed depend on the type of CPO. Importantly, whatever procedure is followed the right to object, the right to challenge and the right to compensation are included in all of them.

Compensation

Those who own and occupy land which is to be purchased under a CPO have a right to compensation, and this includes both Landlords and Tenants. The amount of compensation varies depending on the particular circumstances of the land being acquired. The circumstances will include, amongst other things, what type of tenancy you have, whether you also live on the land, whether it is the whole of the land or only part of it which is being acquired, and the length of the unexpired term of your tenancy.

Compensation can also be paid in respect of various different head of losses. This can include the unexpired term of the tenancy, the loss of your home, relocation costs, disturbance, tenant right, loss of stock value and your legal or agent’s costs. Each of these heads of loss will require calculation and it is therefore important to engage the services of a specialist surveyor to help you in calculating and making a claim as early as possible.

As with any claim for compensation, there is a duty on the claimant to mitigate their loss; that is to take steps to try to minimise any loss/costs you might incur, and therefore the amount of compensation.

Reform

There have been recent reforms to the CPO process through the Levelling-up and Regeneration Act 2023 and there are more planned in the Planning and Infrastructure Bill 2025. Under proposals in the 2025 bill Tenants may be entitled to a higher level of compensation to reflect the loss to them as opposed to landowners who are not in occupation. The Government have also proposed changes to rules around the payment of compensation in respect of “hope value”, the value attributed to the possibility of an increase in the value of land where planning permission is proposed or granted. Authorities can now disregard “hope value” where there is no existing planning permission in place, and proposed reforms seek to widen this power. It remains to be seen what further reforms will be introduced, but tenants of agricultural land should keep an eye on these, particularly if your farm is near existing towns or villages.

What can you do to protect yourself

The best way to protect yourself in respect of CPOs is to keep informed, take action at an early stage and take advice from a specialist Agent or Solicitor at the appropriate stage of the transaction. This is a complicated process that requires specialists to help guide you through it, ensuring that you receive the level of compensation that you are entitled to.

Agri Advisor are specialist Agricultural Solicitors who can advise on a wide range of matters.  Please contact us at advisor@agriadvisor.co.uk if you would like assistance with any legal matters.

By Eve Shrimpton, who is based in our Bala office.

The original article was published in the TFA Cymru Members Newsletter in November 2025. www.tfa.org.uk