Letting agency activity – do RSLs need to register?

Practitioners will no doubt be aware that the registration window for letting agents is now open, and that any business undertaking “letting agent activity”, as defined in s 61 of the Housing (Scotland) Act 2014, must register with the Scottish Government. However, agents will not be undertaking letting agent activity where the landlord of a property is not a “relevant person”, as defined in s 83(8) of the Antisocial Behaviour etc (Scotland) 2004, which definition excludes local authorities and registered social landlords (RSLs).

One consequence of this is that, if a RSL has contracted out the responsibility for the letting of any of its properties to another member of its group which is not itself a RSL, then that group member will not be undertaking letting agent activity. Also, if the RSL grants a lease of properties to its subsidiary in order that the subsidiary can grant tenancies to individual occupiers – commonly done in relation to mid-market rent developments, so that private residential tenancies can be granted to occupiers – then again the subsidiary is not undertaking letting agent activity since, when granting the individual tenancies, it is acting on its own behalf and not as an agent of any third party.

A further point to note, however, is that, if the RSL has a services agreement in place with its subsidiary, pursuant to which the RSL provides property management or maintenance services, then that may mean that the RSL itself is caught by the letting agent registration requirements, since the RSL will be undertaking letting agent activity for a landlord – its subsidiary – which is a “relevant person”.