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Ban on Commercial Lease forfeitures for non-payment of rent extended until 31 March 2021

The Government has announced today Business evictions for non-payment of rent will be extended until 31 March 2021.

The current protection for commercial tenants, was due to expire on 31 December 2020. The Government has advised it is the Final Extension.

“This final extension to protections from the threat of eviction will give landlords and tenants 3 months to come to an agreement on unpaid rent. The government is clear that where businesses can pay any or all of their rent, they should do so.”

They have also said that a review of Landlord and Tenant Legislation will be launched stating “that the current framework does not reflect the current economic conditions”

This is also in line with the legislation in place for Commercial Rent Arrears Recovery “CRAR” as per our previous update on our website dated 18 September 2020 which advised the amount of unpaid rent that must be due before you start the CRAR process.

“The legislation already in place – which prevents landlords from using Commercial Rent Arrears Recovery – now covers an extended period which ends on December 24th, 2020 unless the tenant owes 276 days of unpaid rent, and 366 days of rent when a notice of enforcement is delivered on or after December 25th.”

Also, the restriction on issuing Statutory Demands and Winding-up Petitions, which was due to expire on 31 December 2020, has also been extended until 31 March 2021.

Secretary of State for Housing Rt Hon Robert Jenrick MP said:

“I am extending protections from the threat of eviction for businesses unable to pay their rent until March 2021, taking the length of these measures to one year. This will help them recover from the impact of the pandemic and plan for the future.

This support is for the businesses struggling the most during the pandemic, such as those in hospitality – however, those that are able to pay their rent should do so.

We are witnessing a profound adjustment in commercial property. It is critical that landlords and tenants across the country use the coming months to reach agreements on rent wherever possible and enable viable businesses to continue to operate.”

Business secretary Alok Sharma made the following comments in relation to the extension:

“We have stood by businesses across the country throughout this pandemic, and as we head into the New Year we will make sure they continue to have the support they need to keep their finances stable, protect jobs and build back better.”

According to a press release on https://www.gov.uk/, more guidance designed to support both tenants and landlords is due to be published in the near future; in particular, this guidance is supposed to help parties agree on rent payment options during the ongoing pandemic.

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