The Government has announced new measures to protect the UK high street and other companies from aggressive rent collection and closure, and is asking businesses to pay what they can during the coronavirus pandemic.

  • Temporary new measures to be introduced to safeguard the UK high street against aggressive debt recovery actions during the coronavirus pandemic
  • Statutory demands and winding up petitions issued to commercial tenants to be temporarily voided and changes to be made to the use of Commercial Rent Arrears Recovery, building on measures already introduced in the Coronavirus Act
  • Landlords and investors are being asked to work collaboratively with high street businesses unable to pay their bills during COVID-19 pandemic

While the majority of landlords and tenants are working well together to reach agreements on debt obligations, the actions introduced by Government today are in direct response to reports that some landlords have been putting tenants under undue pressure by using aggressive debt recovery tactics.

Business Secretary, Alok Sharma, explained that, in order to stop these unfair practices, the Government will temporarily ban the use of statutory demands and winding up orders where a company cannot pay their bills due to Coronavirus, to ensure they do not fall into deeper financial strain. The measures will be included in the Corporate Insolvency and Governance Bill announced earlier this month.

Additional steps taken to provide tenants with more breathing space to pay rent include secondary legislation announced by Government which prevents landlords using Commercial Rent Arrears Recovery unless they are owed 90 days of unpaid rent.

The measures announced today aim to further safeguard the high street and millions of jobs by helping to protect them from permanent closure during this time.

Mr Sharma has, however, appealed to tenants to pay rent where they can afford it, or what they can, in recognition of the strains also felt by commercial landlords.

Andy Pear, Partner, BM Advisory, comments: “These steps are a further welcomed intervention by the Government over and above the enormous degree of financial support and forbearance already available. Key stakeholders are encouraged to negotiate and work together on a solution in order to avoid large numbers of businesses entering insolvency.

“For many, these measures will be about short term survival although there will be landlords and property companies also facing hardship.

“More clarity is now needed around how and when the UK lifts the social distancing measures in order to enable businesses to plan ahead”.