Earlier this week, the Welsh Government unilaterally extended the moratorium on forfeiture for commercial properties from 30 September to 31 December. The Welsh legislation was, however, silent on any alterations to the regulations on CRAR (Commercial Rent Arrears Recovery) and statutory demands. Under the existing England & Wales measures, landlords were prevented from using CRAR unless they were owed at least 189 days of unpaid rent and were prohibited from presenting a winding-up petition based on an unsatisfied statutory demand served between 1 March 2020 and 30 September 2020.

We suspected that the UK Government would in due course follow where Cardiff led, and indeed Westminster has now announced similar measures which will be brought into effect in England.

The Communities Secretary, Robert Jenrick, has announced that the moratorium on forfeiture will be extended until 31 December 2020 to carry on protecting commercial tenants whose revenue is being affected by COVID-19.

Mr Jenrick further announced that the restrictions on the use of CRAR (Commercial Rent Arrears Recovery) are also be extended, and the Government has now published legislation giving effect to this. From 29 September, there will be new minimums on the number of days of rent which must be owing before a landlord can exercise CRAR. These are as follows:

• Where the Notice of Enforcement is sent on or before 24 December 2020, the minimum amount of days rent that must be owing is 276.

• For Notices issued after 25 December 2020, there must be a minimum of 366 days’ rent owing.

The Government’s announcement yesterday made no reference to the position on issuing statutory demands for unpaid rent, but it is likely that this too may be extended.

The Government emphasises that these measures are only intended to protect commercial tenants who are legitimately unable to pay the rent. Tenants who are in a position to pay can and should do so and parties should comply with the Code of Practice introduced by the Government in relation to rent arrears: https://www.gov.uk/government/publications/code-of-practice-for-the-commercial-property-sector

Full details of the Government’s announcement can be found on the following link:

https://www.gov.uk/government/news/government-extends-support-to-stop-business-evictions-this-year

We will keep you updated as and when the Government publishes more details of its plans. In the meantime, if you have any questions please do not hesitate to contact a member of our litigation team.