An S106 agreement (Section 106 Legal Agreement), also known as ‘planning obligations’, is a legally binding agreement between the LPA and the developer. They are often used when the LPA believes a development will have significant impacts on the local area that cannot be negated by implementing planning decision conditions.

The Section 106 Legal Agreement comes from a section of the Town and Country Planning Act of 1990. An S106 agreement must be necessary, relevant, and reasonable. Additionally, the development’s viability and the local economy can have a hand in shaping the contents of an S106 agreement, should one be necessary.