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Coronavirus and Commercial Rent – An Update

22nd June 2020

As anticipated in my article “Coronavirus and Commercial Rent – Who Bears the Cost in a Time of Crisis?”, the Government has taken further action in advance of the June quarter day to protect commercial tenants unable to pay their rent. The Government announced on 19 June 2020 that it will be extending the package of protections for commercial tenants from 30 June to 30 September 2020.

  • They will be amending the Coronavirus Act 2020 to extend the moratorium of the landlord’s right to forfeit commercial tenancies for non-payment of rent to 30 September 2020;
  • They will  be extending secondary legislation to prevent landlords from using Commercial Rent Arrears Recovery (“CRAR”) unless they are owed 189 days of unpaid rent; and
  • They have tabled an amendment to the Corporate Insolvency and Governance Bill to extend the temporary ban on the use of statutory demands and winding-up petitions where a company cannot pay due to COVID-19 to 30 September 2020.

The Government has also published a new voluntary Code of Practice to encourage landlords and tenants to work together to protect businesses and give them space to recover from the economic hardships of COVID-19. The Code of Practice has been endorsed by both landlord and tenant organisations and interest groups and it encourages the parties to reach mutually beneficial agreements on rent payments wherever possible. The aim is that tenants pay and landlords forego the rent that they can afford. We will be looking at the Code of Practice in more detail shortly.

If you need advice on the impact of COVID-19 on the payment of rent or on any other aspect of the landlord and tenant relationship, please contact:

Caroline DeLaney, Head of Real Estate Disputes

Email: caroline.delaney@rosenblatt-law.co.uk

Phone: +44 (0) 20 7955 1423