EC wages war on planning gain deals

Planning gain deals between local authorities and developers and contractors could be declared illegal by the European Commission (EC).

The EC has started legal action against France in the European Court of Justice over its public procurement code. Brussels said the French town planning code is incompatible with European public procurement laws by allowing local development agreements (including those following up preliminary studies into potential projects) to be concluded without being advertised and without competition.

If the EC is successful, the practice of contentious retail and mixed-use developments receiving the go-ahead in exchange for the developer/contractor providing the council with a facility will be illegal.

An EC official involved in the case told CJ that in his view, under existing EU procurement laws, "where a developer offers to provide a public amenity such as a park or road crossing that goes beyond its actual contract to build houses or schools, this amenity contract definitely has to be advertised and put out to tender".

A Construction Confederation spokesman said: "We'll certainly follow this matter closely."