Yesterday the Law Commission published a Consultation Paper considering how the right to renew business tenancies protected by Part 2 of the Landlord and Tenant Act 1954 is working and whether it meets the needs of landlords and tenants in England and Wales. This consultation is the first step in a two-part review of the 1954 Act and said to be a chance to test the 1954 Act’s foundations.  It asks whether the current approach of giving tenants security of tenure by default, subject to the ability to “contract out”, is appropriate for a modern commercial leasehold market.

The second Consultation Paper will depend on the outcome of this first paper.  If it is recommended that security of tenure should be retained in some form, it will consider the detailed operation of an appropriate scheme and if it is concluded that security of tenure should be abolished, it will consider how that might be best achieved.

In this first Consultation Paper, the Law Commission asks if the current model for contracting out of the 1954 Act remains the correct approach, or if a different model is now needed. Under the Government of Wales Act 2006, the power to change the law in Wales is “devolved” and exercised by the Senedd unless a topic is “reserved” to the UK Parliament. It is unclear whether any reforms to the 1954 Act would be devolved to Wales but the Law Commission wants to consult stakeholders about reform of the 1954 Act in Wales specifically.

Links to the full Consultation Paper, the online response form, and the survey, can be found at www.lawcom.gov.uk/project/business-tenancies-the-right-to-renew/

If you have any queries regarding the consultation or the 1954 Act, please get in touch with our Property Dispute Resolution team.