A new, legally-binding arbitration process will be introduced to help commercial landlords and tenants settle coronavirus-related disputes, it has been announced.
The new rules will come into effect from 25 March 2022 – the date after which commercial tenants are no longer protected from eviction.
According to the report, the new laws are being introduced to resolve disputes relating to commercial rent arrears accrued as a direct result of the pandemic.
The Commercial Rent (Coronavirus) Bill will establish a legally-binding arbitration process for commercial landlords and tenants who have not reached an agreement before 25 March 2022.
Arbitration – a form of alternative dispute resolution – is commonly used to settle a dispute without having to go to court. Each arbitration session features a claimant, a respondent, and an independent arbitrator. The arbitrator listens to each party’s argument and assesses the evidence before making a legally-binding award.
The Government said the new arbitration process – which will apply to only commercial rent debt related to the mandated closure of certain businesses – will help landlords and tenants resolve disputes effectively and efficiently.
This includes firms, such as pubs, restaurants, and hotels, which were mandated to close, in full or in part, from March 2020 until the date restrictions ended for their sector.
Commenting on the move, Business Secretary Kwasi Kwarteng said: “Today’s measures provide commercial landlords and tenants with the clarity and certainty they need to plan ahead and recover from the pandemic.
“We encourage landlords and tenants to keep working together to reach their own agreements ahead of the new laws coming into place, and we expect tenants capable of paying rent to do so.”
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