Well I never!
According to the British Waterways, a cyclist requires a permit to cycle on towpaths owned by them. However, this is not the case for London and Scotland.
I cycle along the canal most of the warmer months and I never knew that! That said, a) is my part of the canal owned by British Waterways? b) There is no-one to enforce the permits along the route I take.
The permits are free to download once you have filled in your basic details and come in the form of a PDF document:
I have since tried to find a link or a map of the towpaths that are owned by British Waterways, out of curiosity more than anything else and so far, nothing. I have now sent and email to British Waterways in the hope they can answer the question.
I wonder what would happen if you were asked for your permit? Is it enforceable by law? Essentially, you are simply agreeing to the Waterways code of conduct, which to be fair, is common sense. (This document does say London, but it is also relevant nationally).
Here is a link to a PDF document, outlining towpaths that are open to cyclists and even goes as far as telling you the condition of the towpath surface(s).
Since writing this blog, I have found out that the permit is now (almost) officially abolished nationally due to BW not having the resources to enforce it. You can read the official article added in September 2010 here. Instead, there is now a code of conduct for cyclists