Confused for childrens entlement for British citizenship

[samardala]

Hello, We just received out Permanent residence permits with date of issue 25.05.2017 but attached letter stated that we acquired permanent residence - 18 May 2016.
We have 2 children born in UK while we were exercising rights as EEA nationals (but no permanent residence issued yet) January 2014 and March 2016 - Do they have right to be registered as British citizens directly without us applying?
Children of EEA nationals
Some children born in the United Kingdom to EEA and Swiss nationals will be British
citizens automatically. However, changes in the law mean that different rules apply
depending on when a child was born.

I found this in the guide and can`t figure it out - are they entitled or not.

 A child born in the United Kingdom to an EEA national after 30 April 2006 will
be a British citizen if their parent had been in the United Kingdom exercising
EC Treaty rights in accordance with the Immigration (European Economic
Area) Regulations 2006 for more than 5 years or has indefinite leave to
remain.
The child of an EEA national who did not become a British citizen at birth may
now have an entitlement to be registered as a British citizen under section 1(3), if
the parent has since become “settled” here. The parent will have become
“settled” if:
 he or she has been granted indefinite leave in the United Kingdom, or
 he or she has been exercising EEA free movement rights in the United
Kingdom for a continuous period of 5 years ending on or after 30 April 2006.

Entitlement to registration as a British citizen
Children born in the UK – Section 1(3) and 1(3A) application
Section 1(3) - A child born in the UK whose parents are not British citizens and
were not settled in the UK will have an entitlement to register when one of their
parents become settled in the UK or become British citizens.

[CR001]

If they were born in the UK, then yes, they can register as British on form MN1 under section 1(3) of the nationality act. They do not require PR if they are UK born.

[samardala]

thank you very much, i suppose my pr means i`m settled and can apply now for them

[secret.simon]

Do they have right to be registered as British citizens directly without us applying?

Now that you have PR, your children born before you acquired British citizenship have an entitlement to be registered as British citizens.

However, their acquisition of British citizenship is not automatic. It will only happen if you make an application for registration on their behalf. If you do not submit an application for their registration, they do not acquire British citizenship.

Form MN1