The Law Commission has published its second consultation on the reform of Part 2 to the Landlord and Tenant Act 1954, the legislation that gives many business tenants security of tenure and the right to renew their leases. The proposal outlines aims to modernise the legislation, making it clearer and more efficient for both landlords and tenants, while simultaneously ensuring stricter procedural requirements that leave both landlord and tenant explicitly aware of the terms of a tenancy agreement.
The issues on which the Law Commission consulted include:
- Amending the qualifying criteria – whether all new periodic tenancies (an open-ended tenancy with no fixed end date) should fall outside the 1954 Act and whether the minimum fixed-term required for statutory protection should be increased from the current six-month threshold.
- Simplifying the contracting-out process (the removal of the tenant’s security of tenure, or the right to renew their lease) – instead of the prescribed notice of warning being served separately by the landlord to the tenant, it will be placed within the tenancy itself and statutory declarations will be abolished in favour of declarations signed by the tenant within the tenancy agreement.
- Terms of a renewal tenancy – considering whether the current rules on a court determining the terms of a renewal tenancy remain suitable and whether they should better accommodate environmental considerations.
- Rent – whether the court can grant a renewal tenancy with a turnover rent (rent linked to the turnover generated by the business from the premises) and improving the interim rent process (the determination of rent payable during the period of lease renewal).
- Grounds of Opposition – reviewing Ground F (the ground on which the landlord can oppose a tenant’s renewal if they intend to demolish or reconstruct the premises) and whether it should change to accommodate modern building methods, the interaction with environmental standards and minimum energy efficiency requirements.
- Dispute Resolution process – considering whether lease renewal disputes should remain in county courts or whether cases should be decided in the tribunal, High Court or whether there should be a greater role for alternative dispute resolution
As of 25th September 2026, the Law Commission is still analysing the consultation responses and will publish a final report detailing its conclusions and recommendations in due course.
The consultation proposals do not themselves change the law. Any reforms would require implementation by Parliament following the Law Commission’s final recommendations.