The Scottish Government has passed The Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Amendment Order 2024 which makes some technical amendments to the short term let (STL) licensing regime.
Background
STLs, generally, are temporary accommodation offered for consideration in the course of a business (subject to certain exemptions). The definition is wide ranging and so encompasses accommodation beyond the typical short term holiday accommodation that you might first think of.
The Scottish Government implemented a new licensing regime for short term lets, seeking to regulate the STL sector and its operators. The new licensing regime runs parallel to (but is distinct from) the planning regime which governs whether a particular property can become a short term let from a town and country planning policy perspective.
The amendment order brings the below change to the new licensing regime.
Transfer of licences
Previous position
When a STL was sold the new owner would have to apply for a new license before they could start operating.
Amended position
Under the amendments, when the accommodation is sold, the host will be able transfer the licence to the new owner as part of the transaction. It requires the license holder to make an application to the licensing authority with the new licensee's details.
Provisional licences
Previous position
It was not possible to apply for a licence for a new development until the works had been completed and all the relevant health and safety criteria were met.
Amended position
Prospective short-term let hosts building new accommodation are able to apply for a provisional licence before the construction is completed.
Once construction is completed, they can then get their provisional licence "confirmed" where the licensing authority are content that the applicant would be able to secure compliance with the mandatory/standard licence conditions. Therefore, once the development is completed the STL use can be put into use more quickly.
A provisional licence will lapse if it has not been confirmed within 3 years (although this period can be extended if there is a delay in the construction for reasons outwith the applicant's control).
Multiple temporary exemptions
Previous position
A licensing authority could grant an exemption from the requirement to obtain a STL licence which must not exceed 6 weeks in any period of 12 months.
Amended position
Up to three temporary exemptions can now be granted in one calendar year for a combined period of up to 6 weeks.
Therefore, it gives greater flexibility for operators to get exemptions for both summer and Christmas/Hogmanay periods.
Other changes
- "Commercial consideration" for the purposes of defining a short term let will no longer include the "provision of a service" as a benefit in kind.
- Use of a property by a foster child for short term accommodation would be excluded from the licensing regime (i.e. "immediate family member" has been clarified to now include foster children).
- For multiple accommodation units on a single property, the licensing authority now have the ability to refuse to grant a licence in respect of some of the units (rather than an all or nothing approach)
- Assisted living and sheltered accommodation are now "excluded accommodation" and therefore fall outside the licensing regime.
Comments
As a new scheme, there were inevitably going to be teething issues, and it has always been the understanding that the licensing regime will need to adapt and evolve as issues are identified. Therefore, the above amendments demonstrate that the regime is being reviewed.
The amendments seek to reduce procedural delays allowing operators to get the STL uses going upon changes of ownership and developers to be able to "front load" the process to create income as soon as possible following completion of construction rather than new properties standing empty. The amendments to the temporary exemptions should also benefit many small-scale operators who seek to capitalise on events such as the Fringe and Hogmanay.
For further information on the licensing, health and safety or planning requirements of STLs, please see our previous blogs.
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