From Tuesday November 9, new laws and a code of practice are being introduced to resolve the remaining commercial rent debts that have incurred during the pandemic.
The new laws, introduced by Business Secretary Kwasi Kwarteng, will provide a legally binding process to resolve the remaining commercial debts whilst the Code of Practice will provide a published guide for both landlords and tenants in how to negotiate the costs. These changes aim to protect tenants against rent debt claims and help the market return to normality.
Currently, commercial tenants are protected from eviction until March 25, 2022, following government action to provide breathing space for businesses, and to protect jobs largely affected by the pandemic.
The new code of practice will set out clear processes to settling outstanding debts for landlords and tenants alike before the new arbitration comes into force. The ode states that, in the first instance, tenants unable to pay should negotiate with their landlord, who are expected to waiver some or all rent arrears where able to do so.
New laws introduced in the Commercial Rent (Coronavirus) Bill which will be introduced in parliament today will come into place in England and Wales, and Northern Ireland will also have the power to introduce similar legislation within the coming weeks.
The announcement follows the Autumn Budget which included further measures to support commercial landlords and tenants. This included reducing business rates in England by freezing the business rates multiplier for a further year, a tax cut worth over £4.6 billion, alongside introducing a 50 per cent business rates discount for the retail and hospitality sectors.