Landlords Blocked From Evicting Small Businesses Until March 2022

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Landlords Blocked From Evicting Small Businesses Until March 2022

The UK government blocks landlords from evicting small businesses for non-payment of rent due to covid-related reasons for another nine months. 

The government has blocked commercial landlords from evicting small businesses from shops and other premises until 25th March 2022. 

This ensures that sectors that have not yet been able to open will have enough time to come to an agreement with their landlord before eviction is considered. 

This period of delay was first introduced by the government in 2020 and has already been extended four times. It was originally meant to finish in June 2020. 

Community secretary Robert Jenrick has recently announced that new laws will be introduced to protect businesses that have outstanding rental debts because of unforeseen closures due to the outbreak of coronavirus. Landlords are expected to make allowances for the missing rent from these specific periods of closure from the pandemic, sharing the financial implications with their tenants. 

These new laws should help tenants and landlords to come to an amicable agreement on the best way to handle any missing rent. This may be done by waiving some of the missing rent or agreeing to a long-term repayment plan. 

Initially, the agreement will be made between the tenant and landlord themselves, but if an agreement cannot be made then the law ensures a binding arbitration process will be put in place, in which both parties will come to a formal agreement that they both need to honour. 

The government is also trying to protect landlords and has issued that tenants that are able to pay the rent must do so. Tenants should begin paying the rent as soon as restrictions lift and they are allowed to open. 

Community secretary, Robert Jenrick, commented: “This special scheme reflects the unprecedented nature of the pandemic and responds to the unique challenges faced by some businesses. It strikes the right balance between protecting landlords while also helping businesses most in need, so they are able to reopen when it is safe to do so.”

“They will ensure many viable businesses can continue to operate and debts accrued as a result of the pandemic are resolved to mutual benefit swiftly.” 

Statutory demands and winding up petitions will also remain restricted for an extra three months in an attempt to protect businesses from creditor enforcement action where their debts are due to coronavirus-related reasons. 

This comes as welcome news for many in the hospitality and retail industry, who are in an estimated £5bn of rent debt. 

The CEO of the British Independent Retailers Association (Bira) Andrew Goodacre has commented: “The extension to the rent moratorium and the ring-fencing of debt is another campaigning success for Bira.

“It is obvious that retailers with rent debt incurred during the closure periods need further protection and more time as they look to re-build their businesses."

“Whilst the extension is good news, we still await some important details to fully brief our members. We are keen to ensure that there are no loopholes for landlords to exploit."

“Finally, our message to retailers is that it is vital that rent is paid if you are trading. Any debt incurred whilst open will not be protected so it is important for retailers and landlords to sit down and find a practical solution to addressing the debt.”

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