European Charter of Local Self- Government (Incorporation) (Scotland) Act 2026: guidance

4 Key Elements and Implications of the Act

4.1 Key elements of the Act (the Charter Articles)

The Act incorporates Articles 2 to 11 of the European Charter of Local Self‑Government into Scots law. Articles 2 to 11 are reproduced in the schedule of the Act and a summary of them can be found in Annex A of this guidance. These Articles collectively set out the constitutional, legal, administrative and financial foundations of local self‑government.

The Act incorporates the Charter Articles into Scots law by placing certain legal duties on the Scottish Ministers, by requiring that bills for new primary legislation should be accompanied by a statement of compatibility, by requiring that legislation be interpreted in accordance with the Charter, and by providing for the possibility of declarations of incompatibility to be issued by the courts.

4.1.1 Section 2 – Duty to act compatibly with the Charter Articles

Section 2 places a duty on the Scottish Ministers to act compatibly with the Charter when exercising relevant functions. As executive agencies are an integral part of the Scottish Government and may be responsible for exercising “relevant functions” on behalf of the Scottish Ministers, the compatibility duty in section 2 also applies to them (see Annex B).

A “relevant function” is, in general terms, a function within devolved competence that is conferred by (i) an Act of the Scottish Parliament (ASP), (ii) a Scottish Statutory Instrument (SSI) made wholly or partly under an ASP, or (iii) a rule of law not created by an enactment (i.e. a common law rule). In general devolved functions derived from UK legislation are not subject to the compatibility duty.

A “rule of law not created by an enactment” will include general administrative functions or activities which Ministers do under common law powers, as transferred to them by section 53 of the Scotland Act 1998. So it is not only statutory functions that are covered by the compatibility duty.

Common law is law that has been developed by the courts through judicial decisions, rather than by legislation. It includes legal principles and rules that have evolved over time and form part of the law of Scotland. Common law can apply where there is no relevant statutory provision, or alongside legislation where courts have established legal principles through previous cases.

4.1.2 Section 3 – Duty to promote and strengthen local self-government

Section 3 places a broader, ongoing duty on the Scottish Ministers to promote and strengthen local self‑government in Scotland. Ministers must keep under consideration whether there are any steps which they could take which would, or might, safeguard and reinforce local self‑government. This includes consideration of steps to increase the autonomy of local authorities, consistent with the Charter Articles.

Unlike section 2, this duty is not limited to the exercise of relevant functions and is forward‑looking and strategic in nature. The duty is intended to encourage a proactive approach to supporting local democracy, subsidiarity and local discretion across government activity.

Section 3 also includes a Parliamentary reporting requirement, so that Parliament can hold Ministers to account in their compliance with this duty. That reporting requirement is addressed in more detail in the Reporting chapter of this guidance.

4.1.3 Section 4 – Interpretation of legislation

Section 4 requires certain Scottish legislation to be read, as far as possible, in a way that is consistent with the Charter Articles.

This means that where there is more than one possible interpretation of a provision, the interpretation that is most compatible with the Charter Articles should be preferred, provided that it is reasonable to do so. The duty applies to words in ASPs and SSIs as set out in sections 6 and 7 of the Act.

Section 4 does not mean that legislation can simply be ignored or rewritten if it appears to conflict with the Charter Articles. Where legislation is clear and an incompatibility cannot be resolved through interpretation, the legislation continues to have effect unless it is changed through one of the mechanisms provided elsewhere in the Act.

In practice, section 4 helps ensure that devolved Scottish legislation is applied in a way that gives effect to the Charter Articles wherever this is reasonably possible.

4.1.4 Section 5 – Declarations of incompatibility

Section 5 gives the courts a power to issue a declaration of incompatibility where they decide, in proceedings before them, that certain Scottish legislation is incompatible with the Charter Articles.

Only the Court of Session or the UK Supreme Court can make a declaration of incompatibility under the Local Self-Government Act.

A declaration of incompatibility is a formal statement by the court that legislation is not compatible with the Charter Articles. However, it does not invalidate the legislation or prevent it from continuing to operate. The legislation remains in force unless and until it is amended or repealed.

In practice, a declaration of incompatibility highlights that there is a conflict between legislation and the Charter Articles and provides a basis for the Scottish Ministers to consider changes to the law. The Act includes powers which may be used to amend legislation in response to a declaration of incompatibility.

4.1.5 Section 11 – Statements about Charter-compatibility of bills

Section 11 introduces a requirement in relation to new primary legislation. Any MSP introducing a bill to Parliament must prepare and publish a statement of compatibility setting out their view on the extent to which the bill is compatible with the Charter Articles. This will encourage the Scottish Ministers to consider at the earliest opportunity in the development of any bill whether the policy underpinning the proposed bill is Charter compatible. The statement of compatibility will also provide the Scottish Parliament with an assurance about the extent to which bills lodged are compatible, to inform its consideration of them.

The Act will accordingly have far‑reaching impacts for the development of policy and legislation, and for ministerial decision‑making, which has implications for local government. It requires a Charter‑aware approach at all stages, including policy design, ministerial decisions, and the development of primary and secondary legislation.

4.2 Implications of the Act

There are practical, legal, policy, and operational consequences arising from the incorporation of the Charter into Scots law. It encompasses how the principles and rights set out in the Charter influence the interpretation of legislation, the development of policy, and decision‑making processes by the Scottish Ministers.

Implications may include:

• Legal implications: The requirement to interpret legislation, where possible, in a manner compatible with the Charter Articles, and the potential for legal challenge where Scottish Ministers act inconsistently with Charter Articles.
• Policy implications: The need to ensure that new and existing policies respect local autonomy, subsidiarity, and the financial independence of local authorities.
• Operational implications: Adjustments to governance arrangements, decision-making procedures, and administrative practices to comply with Charter obligations.
• Financial implications: Consideration of how funding arrangements and resource allocation support the effective exercise of local self-government.

4.3 Primary legislation

All Scottish Parliament bills introduced from 15 October 2026 onwards will have to be accompanied on introduction by a statement of their Charter compatibility. This applies to both government and non-government bills.

4.3.1 What is a statement of compatibility?

A statement of compatibility (SoC) is made on or before introduction by a Member of the Scottish Parliament introducing a bill. It will set out the extent to which, in that Member’s view, the bill is compatible with the Charter Articles.

Under section 11 of the Act, a SoC is required only for primary legislation. The requirement does not apply to secondary legislation or other policy activity.

The purpose of the SoC is to ensure that, at the point a bill is introduced, Ministers (or the member, for a non-government “members’ bill”) have explicitly considered whether its provisions are compatible with the Charter Articles. It also provides a clear indication to the Scottish Parliament about the extent to which, in the view of the member introducing it, a bill before it is compatible with the Charter, so that it can make an informed decision about whether or not to pass the bill.

In order to reach a view on Charter compatibility, Ministers must understand how a bill may affect local government in practice. This requires consideration of whether the bill has any potential positive or negative implications on local authority powers, responsibilities, autonomy, resources, governance, or democratic accountability, and whether any constraints on local government are justified.

In practice, for government bills, the Scottish Government will assess whether the bill will affect local government. Effects on local government might include changes to:

• the powers, responsibilities or autonomy of local authorities;
• the financial position of local government;
• governance, accountability or democratic decision‑making at local level; or
• the relationship between the Scottish Ministers and local authorities.

Scottish Government officials will identify potential risks of incompatibility at an early stage, consider mitigation where appropriate, and support Ministers in reaching a well‑reasoned view on Charter compatibility.

4.3.2 Declaration of Incompatibility

Where provisions within an ASP cannot be interpreted in a way that is compatible with the Charter Articles, the courts may issue a declaration of incompatibility. Such a declaration does not affect the validity, continuing operation or enforcement of the legislation. Instead, it signals that the legislation is not compatible with the Charter Articles and may require remedial action by the Scottish Ministers. Under section 8 of the Act, the Scottish Ministers can, by way of regulations, make such provisions as they consider necessary or expedient in consequence of a declaration of incompatibility. These regulations can modify an ASP. This allows issues to be resolved in a flexible and timely way while maintaining legal certainty.

4.3.3 Effect of the interpretation duty

Once enacted, an ASP will be subject to the interpretation duty in section 4 of the Act. This means that, so far as it is possible to do so, the courts must read and give effect to the provisions of an ASP in a way that is compatible with the Charter Articles.

The effect of this is that Charter compatibility remains relevant beyond the point at which a bill is introduced and the SoC is made. The courts must take the Charter Articles into account when interpreting legislation and, where more than one interpretation is available, should prefer an interpretation that is consistent with the Charter Articles.

4.4 Secondary legislation (SSIs)

When preparing and drafting secondary legislation Scottish Government officials will consider whether they are exercising a “relevant function”. As above, this is generally when an action is being taken using a power derived from an ASP (or sometimes an SSI).

If an SSI involves the exercise of a relevant function under the Local Self-Government Act, the duty in section 2 applies. In these circumstances, the Scottish Ministers must act compatibly with the Charter Articles when making the SSI, including as to its underlying policy. Failure to do so could result in the SSI being reduced (i.e. set aside or nullified) by the courts on judicial review.

Where officials are developing an SSI under a “relevant function”, they will consider at an early stage whether the proposal may have any potential implications for local government. This includes implications on local authority powers, responsibilities, discretion, resources, governance arrangements, or the relationship between the Scottish Ministers and local authorities. If it does, officials will ensure that what the SSI does is compatible with the Charter.

4.4.1 Declarations of incompatibility for SSIs

In general, where the Scottish Ministers make an SSI under a relevant function and that SSI is incompatible with the Charter, they will have acted unlawfully by breaching the duty in section 2 of the Act. In such cases, the appropriate remedy would be to reduce the SSI, rather than make a declaration of incompatibility.

A court can make a declaration of incompatibility in relation to an SSI only where it is satisfied that the incompatibility cannot be removed because of the provisions of the ASP under which the SSI was made. In other words, a declaration of incompatibility is available only where the incompatibility is required by the ASP itself, leaving Ministers with no option but to make an SSI that is incompatible with the Charter.

Where subordinate legislation is made under powers contained in a UK Act, and the parent UK Act prevents the incompatibility from being removed, the court cannot make a declaration of incompatibility.

A declaration of incompatibility does not affect the validity, continuing operation or enforcement of the provision to which it relates.

The courts have discretion in determining how the decision should take effect. In particular, the court may:

• limit or remove any retrospective effect of its ruling; and/or
• delay the effect of the decision for a specified period.

For example, where an incompatibility is identified in secondary legislation, a court may decide to suspend the effect of its ruling. This would prevent the incompatible SSI ceasing to have effect immediately, avoiding any immediate practical difficulties, while providing time for the incompatibility to be addressed before the ruling takes full effect.

The Scottish Ministers can use the remedial power under section 8 to make such provision as they consider necessary or expedient in consequence of a declaration of incompatibility. Scottish Ministers may also choose to revoke the secondary legislation and amend it or re-lay a different version.

4.4.2 Effect of the interpretation duty on SSIs

Once made, SSIs made by virtue of a relevant enabling power for the purposes of section 7, are subject to the interpretation duty in section 4. This means that, so far as it is possible to do so, they must be read and given effect in a way that is compatible with the Charter Articles.

The effect of this duty is that Charter compatibility remains relevant after an SSI has been made. The Charter Articles may influence how provisions are interpreted and applied in practice, particularly if there is any ambiguity in a provision, and may be taken into account by the courts when considering the meaning and effect of subordinate legislation.

4.5 Policy development and delivery

Policy development and delivery includes the range of approaches the Scottish Government uses to develop, implement and review policy. This includes stakeholder engagement, evidence gathering, consultations, strategies, legislation, and guidance.

As part of policy development and delivery, officials will consider whether a proposal could affect local self-government or the autonomy of local authorities, and whether there are opportunities to safeguard and reinforce these principles. Where a proposal concerns a matter capable of being exercised at local level, officials should consider whether national action is necessary and, where it is proposed, provide a clear justification for that approach having regard to the principles set out in Article 4.

These considerations will be proportionate to the nature, scale and potential impact of the proposal.

When exercising relevant functions, officials will assess how a proposal interacts with the Charter Articles and take this into account alongside other policy, legal and operational considerations. This will help ensure that the potential implications for local government are identified and considered at an early stage of policy development.

The level of consideration required will vary depending on the proposal. In many cases, a brief assessment may be sufficient. For proposals with more significant implications for local government, more detailed consideration and engagement with local authorities may be appropriate.

In practice, this means that Scottish Ministers will have regard to the Charter Articles and ensure that the actions they take are consistent with them. This includes:

• respecting local autonomy over all matters for which they have responsibility and ensuring oversight of delivery by national government is proportionate;
• engaging in timely consultation with COSLA where proposals and decisions may impact on local government;
• having regard to the resource and administrative implications for local authorities of new policies and legislation and funding them adequately; and
• supporting local authorities to exercise their functions with appropriate freedom and discretion to make decisions locally.

The interpretation duty reinforces the importance of considering Charter compatibility throughout policy development and delivery. As the Charter Articles may influence how legislation is interpreted and applied following enactment, consideration of their implications forms an important part of developing policies and legislation that affect local government.

4.6 Ministerial decisions

Ministerial decision-making processes relating to relevant functions will demonstrate clear consideration of the Charter Articles, including proportionality, respect for local democratic accountability, and consideration of alternative approaches.

Ministers may need to justify interventions that remove or constrain local decision‑making, particularly where local authorities have been allocated functions by statute and could reasonably exercise those functions themselves. Weak or poorly evidenced justifications may result in legal challenge.

Articles 4(4) and 9(7) of the Charter may also create a presumption against the use of non‑legislative levers, such as ring‑fenced funding, grant conditions or informal pressure, to direct local authority behaviour. This may require a shift towards greater reliance on legislation to clearly demarcate responsibilities, or greater codesign and formal collaborative mechanisms, rather than administrative controls.

4.7 Engagement with local authorities

Effective engagement with local authorities is central to both the letter and the spirit of the Act. The Charter requires that local authorities be consulted, insofar as possible, in due time and in an appropriate way, in the planning and decision-making processes for all matters which concern them directly. The Charter emphasises partnership, consultation and respect for local self‑government, and these principles will be reflected in how policy is developed and implemented by the Scottish Government.

Officials will therefore engage with local government at an early stage, particularly where proposals may have significant implications for local powers, responsibilities or resources. Early engagement allows issues to be identified and addressed while proposals are still flexible.

Consultation will be used as a genuine opportunity to shape policy. This includes being open to alternative approaches suggested by local government and allowing sufficient time for meaningful input.

Officials will be transparent about constraints, trade‑offs and areas where flexibility may be limited, whether due to fiscal, legal or policy considerations. Clear communication supports trust and more productive engagement.

Engagement will always be proportionate and meaningful to the nature and scale of the proposal, this may include where policies affect core local government functions, reallocate responsibilities or costs, or introduce new forms of supervision, reporting or accountability.