Consultation opens on protections for commercial tenants

Following last month’s announcement of a further three month extension to its various protections for commercial tenants, the Government has now re-stated its position of support for commercial landlords and tenants as they seek to negotiate arrangements for addressing accumulated debt.

To that end, they have published a consultation paper and online questionnaire, as they gather evidence to inform further potential legislation that may be necessary to ensure a phasing out the restrictions over a period of time, rather than the current cliff edge that many tenants fear on 1 July 2021.

Questionnaire

In the questionnaire, you will find general questions about the nature of your business, turnover, number of employees etc. They ask for details about rent negotiations that have already taken place during the pandemic and the outcome or most likely outcome.

Your views are invited on the moratorium on forfeiture, and the voluntary Code of Practice introduced last year to facilitate negotiations.

Potential steps

The Government have taken the step of setting out the potential steps they may take after 30 June 2021 and asks your opinion on each one. The current options are:

• Option 1 – allow these measures to expire on 30 June 2021;
• Option 2 – Allow the moratorium on commercial lease forfeiture to lapse on 30 June 2021 but retain the insolvency measures and additional rent arrears amendments to CRAR for a period of time;
• Option 3 – Target existing measures to businesses based on the impact that COVID restrictions have had on their businesses for a limited period of time;
• Option 4 – Encourage increased formal mediation between landlords and tenants;
• Option 5 – Non-binding adjudication between landlords and tenants; and
• Option 6 – Binding non-judicial adjudication between landlords and tenants.

Timescale

As time is necessarily tight, the deadline for responses is 11:45 pm on 4 May 2021.