or bringing them to an end was signed by planning minister Keith Hill
of cases which go to court, will remove the current need for
landlords and tenants who have agreed to waive security of tenure to
get court permission. It will be replaced by a simpler 'health
warning' notice, written in plain English, served on the tenant.
The minister said:
'Our reforms will make the process of renewing or ending a business
tenancy quicker, easier, fairer and cheaper. Both owners and
occupiers of commercial property stand to benefit.
'Our reforms mean landlords and tenants about to take out a lease
will no longer need to get court permission for an agreement to waive
the tenant's normal rights of security of tenure. This was a
bureaucratic and sometimes costly process which our research has
shown is not an effective safeguard for business tenants giving up
their right to renew their tenancy.'
The Order requires the landlord to serve a 'health warning' notice on
the tenant, explaining the loss of rights and the importance of
getting professional advice. The tenant must sign a declaration that
they have read the 'health warning' and accepted its consequences.
The landlord must give the tenant at least 14 days' notice otherwise
the tenant must visit an independent solicitor to make a special
The Order contains a number of other useful provisions, such as:
making the rules on interim rent (rent payable pending renewal of the
tenancy) fairer; clarifying how a tenant may bring a business tenancy
to an end; and improving the arrangements for the parties to obtain
information from one another before embarking on renewal or
The new arrangements will come into effect on 1 June 2004.
1. The n ew Order, the Regulatory Reform (Business Tenancies) (England
and Wales) Order 2003, has made a number of detailed amendments to
Part 2 of the Landlord and Tenant Act 1954. The Order and Part 2 of
the 1954 Act, as amended, may be found at www.odpm.gov.uk.
2. The changes stem mainly from the Law Commission report Business
Tenancies: A Periodic Review of the Landlord and Tenant Act Part II
(Law Com No 208, published in 1992). They were refined in the course
of subsequent consultation exercises by the Department of the
Environment (1996) and the Department of the Environment, Transport
and the Regions (2001).
3. The Order underwent detailed parliamentary scrutiny in autumn
2002. The House of Commons Regulatory Reform Committee were content,
subject to some minor amendments which the government accepted. The
House of Lords Committee on Delegated Powers and Regulatory Reform
had some concerns about the revised arrangements for agreements to
exclude security of tenure. In response, ODPM carried out some
research on the existing procedures and further consultation of small
business representative bodies, which met the committee's concerns.
The Order underwent final parliamentary scrutiny, with subsequent
approval by both Houses, in autumn 2003.
4. The Order applies to England and Wales. The National Assembly for
Wales gave plenary consent to the Order on 4 November 2003.
5. The new provisions come into effect on 1 June 2004. In
preparation, ODPM will be amending the current statutory notices
provisions, as a Statutory Instrument under the Landlord and Tenant
Act 1954. It is also preparing information and detailed guidance
material for users and their professional advisers.