The BBC has released a terrific investigative report about a tax dispute before the Liverpool City Council regarding a downtown office space. It’s a dispute that turns, as so often happens, on answering the question “when is a vacant office business actually a legitimate snail-farming operation”?

Liverpool (like many jurisdictions) taxes domestic (residential) and commercial property at different rates. An owner of non-domestic property not only has to pay much higher “business rates,” they have to pay even if the property is vacant. (Some “agricultural uses” are exempt, which will be important in a second.) This is probably meant as an incentive/punishment to minimize the number of empty storefronts, but it’s not hard to see why people might be upset about having to pay the full business rate for a non-existent business. That plus the natural aversion to paying taxes has encouraged what are either pernicious tax-avoidance schemes or creative tax-reduction strategies, depending on your point of view.

In this case, the council says the ground-floor office space at 9 Dale Street is currently empty and the firm renting it should be paying full business rates. The firm and its landlord disagree, saying the space isn’t empty and is being put to an “agricultural use.” Specifically, the space is occupied by fifteen (15) crates each containing at least two (2) snails. So the firm—Snai1 Primary Products 2023 Ltd—says it’s exempt.

While this argument is creative, it isn’t new. In fact, it’s been around long enough that it’s already been tested in court. See Isle Inv. Ltd. v. Leeds City Council [2021] EWHC 345 (Admin) (which begins, “This is a case about a rates-avoidance arrangement in relation to office premises in Leeds. It features some snails in some crates.”) It was not well received.

As the BBC points out, Snai1 Products has only one director, Terence Ball, who also happens to be on the board of a company called BoyceBrook. That company’s website says it “has a proven track record of minimising the liability for empty property rates,” but is a little short of details as to how it does this. The site says only that its “solutions” involve “the introduction of a guaranteed minimum disturbance tenant to the property who is entitled to rates relief or exemption.” It also answers what is apparently a Frequently Asked Question: are these solutions “completely legal”? The answer: “Our empty property rates solutions are formulated to work within the law to take advantage of current reliefs and exemptions.” Notice that this is a little short of a simple “yes,” which is really the preferred answer to that question.

Coincidentally, Mr. Ball is or was also a director of a company called Crusader, which was running a similar snail-based empty-property-rate solution in Leeds that the HIgh Court found was a “sham.” This paragraph from the opinion (edited for clarity) describes how an investigator found the alleged snail farm was operating:

There was no caretaker or owner presence on site in relation to any of the units during the periods of the leases…. The “element of occupation” … was the presence of 50 crates in Unit 4, 40 crates in Unit 7 and 10 crates in Unit 2…. Crates opened were found to contain a single snail with a covering of straw; another [had] two snails, a small tub of soil, a small tub of bark and a small tub of dried grass, but no evidence of water [which snails need to live]; another [had] similar contents…. When the water supply to the Unit was checked it was found to have been turned off (and there was no demand received for the water to be turned on).

In short, the court held, this “was not a snail farm,” and never had been; these were only “purported snail farms…. To say that there was a snail farm in the units is a fiction. There was no meaningful business taking place in the offices at any time.” (Emphasis added.)

According to the BBC, the Liverpool operation seems to have worked the same way. “About 15 covered crates—containing as few as two snails each—have been kept on the lower ground floor of 9 Dale Street” since 2023, it reported. Snail-farming experts told the BBC it takes thousands of snails to have a viable snail-farming business. But Mr. Ball has insisted that 15 crates with two snails each is plenty. That arrangement could “create 1000 snail eggs,” he said, in the “right environment,” which he implied would include the lower ground floor of 9 Dale Street. In fact, according to the website of yet another snail business owned by Mr. Ball, having more than two snails in the same crate could be nothing short of immoral: “Cannibalism, group sex and ‘snail orgies’ are also rife when so many snails are confined together in such an unpleasant and unethical environment,” it asserts.

With only two snails you could still have snail cannibalism, but at least they’d be monogamous, if that’s important to you for some weird reason.

But the relatively small number of snails involved seems to rule out the possibility of this being a viable farm, even if these snails were provided with water. Note that a real snail farm operation might be entitled to the exemption, even if it were set up in what would ordinarily be a light-office space. But only purported snail farms, no.

Landlords should therefore be wary of schemes like this one, writes Simon Wilson, a commercial-property lawyer with the Wollens firm in the UK. “Owners entering into these agreements usually pay a cut of the saving to the sham operation,” he explains. “But if the operation is declared bogus, they will then have to pay the full sum of business rates, together with penalties, legal fees and reputational damage.” So the snail version of this scheme, at least, seems unlikely to be worth it.

It could also constitute snail abuse, but if the things are really so prone to cannibalism and immoral behavior, then maybe no one will care about that part.