Major Law Commission review of the Landlord and Tenant Act 1954 continues

A major review of Part 2 of the Landlord and Tenant Act 1954 (1954 Act) is currently being undertaken by the Law Commission. This follows the first phase of the Business tenancies: the right to renew project, which concluded in 2025.

The potential reforms could see a major shake-up in the commercial property sector for the first time in decades.

Security of tenure

RICS responded to the first consultation paper in early 2025, which sought to better understand sector views on security of tenure. We made the case for the retention of the contracting-out model of statutory security of tenure on the basis that specific improvements were consulted on and approved during the second phase of the consultation.

This included the resolution of disputes. RICS emphasised to the Law Commission that conflicts between landlords and tenants are avoided as far as possible, but in circumstances where disputes arise, it should be possible to resolve these quickly and cost effectively.

While the contracting-out model of security of tenure itself is suitable, the way in which the renewal process works in practice, including the cost of it and length of time that the process takes, increases the number of excluded tenancies.

Greater understanding and adoption of alternative dispute resolution (ADR) and conflict avoidance measures, by both private and public sector organisations, could significantly reduce the occurrence and impact of contractual disputes, saving valuable time and resources.

Interim Statement

In June 2025, the Law Commission published its initial findings. This included the provisional finding that the existing contracting-out model is the right model to retain.

It is currently being consulted on whether the threshold for excluding tenancies from the scope of the 1954 Act, based on the tenancy’s duration, should be increased from 6 months to 2 years.

Have your say

The Law Commission has now published its second consultation paper, as well as a concise summary.

RICS welcomes member views on the below areas or wider issues raised in the consultation.

Key areas of focus include:

• Facilitating “turnover rents” and other rental models.
• Rent payable during the continuation tenancy (“interim rent”) and the commencement date of the renewal tenancy. Two options are set out for reform (see p.18).
• The grounds to oppose a renewal tenancy.
• Greater use of alternative dispute resolution in resolving disputes under the 1954 Act (see. p.24).
• The interaction between the Minimum Energy Efficiency Standards regulations and the 1954 Act.
• Any considerations or experiences in Wales in relation to reform of the 1954 Act.
• Transitional arrangements.
   

Please email publicaffairs@rics.org with any comments, feedback or views.

Consultation event

The Law Commission is running a virtual consultation event on its Business Tenancies and Commercial Leasehold projects on 9 September at 12:00 to 13:15. You can register to attend this here.