Planning obligations

Planning obligations, also known as Section 106 agreements (based on that section of the 1990 Town & Countryside Planning Act), or Unilateral Undertakings (UUs) are legal agreements that developers sign which contain obligations/covenants designed to mitigate the negative effects of a development which would otherwise be unacceptable in planning terms. These can be non-financial and/or financial commitments.

They can be used to:

Prescribe what type of development takes place, by requiring a certain amount of affordable housing in a residential project, for example; or obtain contributions towards infrastructure from a developer in order to lessen a project’s impact, or to compensate for loss or damage.

Regulations state that a Planning Obligation can only be considered as a reason for granting planning permission if it is:

• necessary to make a development acceptable in planning terms;
• directly related to the development; and
• reasonably related to a development in terms of scale and type.