The Council has also applied for a judicial review of the way the Government made its decision on which areas should be granted exemption from the rules.
The new rights came into force on 30 May this year. In addition to the office-to-home conversion rights, rules were also introduced to allow the change of existing shops, dentists, pubs and other uses over to a betting shop or pay day loan businesses.
Areas within 17 local authorities were granted exemption from the rights following an application procedure, including the Central Activities Zone (CAZ) and Tech City in London, as well as areas in the Isle of Dogs and the Royal Docks Enterprise Zone.
Islington Council had made two applications for exemptions, one for the area covered by the CAZ and one for the rest of the borough. The latter application was rejected. The Council said in a statement that it estimates that the new rights could put around 6,000 jobs at risk and stifle future job growth.
Planning Minister Nick Boles last month told a House of Commons select committee that the selection process for determining which areas should be exempt had involved consultants from outside the Department for Communities and Local Government scoring each council using a points system based on four criteria.
"In Islington we've got firm plans for stopping too many betting shops and payday lenders, for protecting local jobs, and for building affordable housing," said the Council's executive member for housing and development James Murray. "But the Government's changes are undermining what we're trying to do by allowing developers to bypass these plans in a reckless free-for-all."
"The government's changes mean we won't be able to stop our high streets being flooded with payday loan companies – and any office space can be converted into poor quality private homes with no affordable housing at all," Murray said.
"This is not right for Islington and so we have decided to challenge the government. We have started the legal process to try and overturn the Government's changes," he added.
