Tenants given more protection

By James Wilmore

- Last updated on GMT

Related tags Renting Lease Leasehold estate

A new voluntary code of practice covering lease agreements for small businesses has been heralded as "good news" for licensees. The updated Code for...

A new voluntary code of practice covering lease agreements for small businesses has been heralded as "good news" for licensees.

The updated Code for Leasing Business Premises has a number of radical changes from the 2002 edition and should help tenants and lessees avoid the pitfalls of the property leasing process.

And speaking on the issue of upwards only rent reviews at the code's launch, minister for housing and planning Yvette Cooper said the government would be willing to impose legislation if this practice continued.

The changes in the code include:

- Landlords should, on request, price alternative rent review terms on a risk-adjusted basis, rather than providing a menu

- Preconditions on break clauses are significantly restricted

- If subletting is allowed, it should be at the market rent

- At the time of negotiating the lease landlords must disclose known irregular events that would have a significant impact on the amount of future service charges

- Unless expressly stated in the heads of terms, tenants should only be obliged to give the premises back at the end of their lease in the same condition as they were in at its grant.

A spokeswoman for the Royal Institution of Chartered Surveyors said: "This new code will help publicans know where they stand. When they are renewing a lease it will show them what to look out for. There is also information on what they should be getting from their landlord and also telling them what they need to do."

It is hoped the code will also ensure that landlords, particularly small landlords, follow the best practice agreed across the industry.

For a copy of the code visit: ww.leasingbusinesspremises.co.uk

Related topics Property law

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