Commercial Rent (Coronavirus) Bill Report 5.38pm Clause 2: “Rent”
and “business tenancy” Amendment 1 Moved by Lord Grimstone of
Boscobel 1: Clause 2, page 2, line 42, at end insert— “(6) “English
business tenancy” means a business tenancy comprising premises in
England.(7) “Welsh business tenancy” means a business tenancy
comprising premises in Wales.”Member’s explanatory statement The
amendment would define “English...Request free trial
Commercial Rent (Coronavirus) Bill
Report
5.38pm
Clause 2: “Rent” and “business tenancy”
Amendment 1
Moved by
1: Clause 2, page 2, line 42, at end insert—
“(6) “English business tenancy” means a business tenancy
comprising premises in England.(7) “Welsh business tenancy” means
a business tenancy comprising premises in Wales.”Member’s
explanatory statement
The amendment would define “English business tenancy” and “Welsh
business tenancy”.
The Minister of State, Department for Business, Energy and
Industrial Strategy and Department for International Trade
() (Con)
My Lords, the amendments proposed to Clauses 2, 9, 23 and, to
some extent, 27 are the result of extensive discussions with
Welsh Ministers, who expressed their wish that the delegated
powers in the Bill be redrafted to clarify areas of Welsh
competence in recognition of the importance of the Bill’s policy
to Welsh businesses.
The amendments to Clause 9, regarding extending the period for
making a reference to arbitration, clarify that the power to
extend the arbitration reference period can be exercised for
English business tenancies or for Welsh business tenancies, as
well as for both. The amendments to Clause 23 decouple the
moratorium period and the period for making a reference to
arbitration. The moratorium period will end six months from Royal
Assent, unless extended.
New Clause 23A provides that the UK must seek the consent of
Welsh Ministers to extend the Bill’s moratorium period for Welsh
business tenancies in respect of devolved matters. In relation to
Clause 27, which is the power to reapply the Bill to a future
period of coronavirus, I have tabled an amendment to enable
regulations under this clause to be made just for English
business tenancies, or just for Welsh business tenancies, or for
both. The amendments to this clause also provide that the UK
Government will seek the consent of Welsh Ministers on the use of
powers to reapply the Act for Welsh tenancies in response to
future periods of coronavirus-related business closures, where
the provisions are devolved. In addition, in the event of new
coronavirus restrictions in Wales, new Clause 27A has been
included to enable Welsh Ministers, concurrently with the
Secretary of State, to use the power to reapply the relevant
moratorium provisions to Welsh business tenancies. I am pleased
to confirm that the Senedd has now voted to support the
legislative consent Motion in relation to this.
As noble Lords will be aware, the Delegated Powers and Regulatory
Reform Committee published its report on 3 February. Following
careful consideration of this report, I have now made several
amendments to Clause 27 in order to address issues raised by the
committee. I thank the committee for bringing this matter to the
attention of the House. Primarily, the amendments limit the
breadth of the Secretary of State’s powers to reapply the
provisions of the Bill in the future. The amended power would
allow for targeted modifications to accommodate new dates and to
make adjustments to moratorium provisions to take account of new
timeframes. However, it would not permit changes to the operation
of the arbitration process or policy. The Secretary of State
would retain the ability to make different provision for England
and Wales, and to make incidental, supplemental, consequential,
saving or transitional provisions. I beg to move.
(LD)
My Lords, it is pleasing to see so many more noble Lords
attending this debate than there were in Committee, when there
were just four of us—two of whom have subsequently come down with
coronavirus. So your Lordships have been warned.
This group of amendments is testimony to the fact that the
Minister listened in Committee, and has attended many meetings
and taken note. For that, the Minister and the Government should
be congratulated and thanked in broad measure. I highlight in
particular Amendment 21, which, as the Minister set out,
addresses the issues highlighted by the DPRRC. This was a serious
issue, and the Minister has effectively addressed it. It is a
welcome change and something these Benches were particularly
concerned about it, and it was good of the Minister to have taken
it on. Also, conversation with the Welsh Government has been
extremely successful, and that is borne out by the legislative
consent that the Minister and Government have received. Overall,
we welcome this group of amendments and think them a very good
improvement to the Bill as we now see it.
(Lab)
My Lords, as the House may have spotted, I am not the noble
Baroness, Lady Blake, as she is one of the two noble Lords who
have fallen victim to Covid. We all wish her well for a quick
recovery.
On this side of the House, we also welcome the Government’s
moves, which follow on from representations made by the Welsh
Government and the DPRRC. They show that the Government have
listened and have acted upon the concerns raised. Perhaps the
Minister could confirm in response that the Welsh Government are
fully satisfied with these changes too, in which case we too are
satisfied.
(Con)
My Lords, I can so confirm.
Amendment 1 agreed.
5.45pm
Clause 7: Approval of arbitration bodies
Amendment 2
Moved by
2: Clause 7, page 5, line 23, at end insert—
“(2A) The Secretary of State must ensure that bodies approved
under subsection (1) have adequate resources and sufficient
numbers of arbitrators as are (whether alone or as a member of a
panel of arbitrators) required to conduct arbitrations under this
Part.”Member’s explanatory statement
This amendment would require the Secretary of State to ensure
that the approved arbitration bodies collectively have sufficient
capacity, and resourcing, to hear all arbitrations under this
Part.
(Lab)
My Lords, Amendment 2 builds on the debate in Committee. The
House will be pleased that I will not repeat all the arguments
put forward then, but it is worth saying at the outset that this
amendment is in response to severe pressures that businesses,
tenants and landlords are under following an extremely difficult
trading winter, plus the economic pressures of national insurance
increases, energy price rises and escalated inflation. The clock
is ticking loudly.
Arbitrators will be dealing with the cases that could not be
resolved through voluntary measures between the parties. These
will include in the main the most complex, as well as those where
a failure to act was in the hope that debt would just disappear.
As a point of interest, it would be beneficial to know from which
sectors these outstanding cases come—not geographically, but from
which sectors of economic activity. Perhaps the Minister could
respond.
In Committee, the Minister—whom I paraphrase—told us not to worry
about the arbitration service and that all would be well and
sorted out in due course. Can he tell us what his optimism is
based on? Have the Government made an assessment about the
demands that will be made on the service, beyond simply the
number of outstanding cases? If so, can we see the evidence of
that assessment? Also in Committee, the Minister said that the
Government supported the market-based approach in which
arbitration firms would move things around to get over the
expected spike in demand. The Minister said that he had been
reassured by the arbitration firms of their ability to cope. But,
without a detailed assessment or understanding of both the volume
and complexity of cases, coupled with a change in the nature of
the work that arbitrators will be asked to carry out—which the
noble Lord, , will introduce in a later
amendment, on behalf of the noble Earl, Lord Lytton—this would
appear to be wishful thinking.
If in reality there is either an insufficient number of
arbitrators, or too many complex cases, or both, this reliance of
the market-based approach may be something the Government come to
regret. So will they keep the progress in clearing the backlog of
cases under review and report back to Parliament from time to
time? I have no doubt about the quality and excellence of the
arbitration service itself across the whole of the UK, but we are
concerned that the Government have not undertaken an assessment
of the numbers and the resources available in order to be fully
satisfied that all arbitrations can be conducted in good
time.
Amendment 15 proposes that, when the Government issue guidance to
arbitrators aimed at enabling better outcomes, Parliament should
be informed. Some concern has been expressed, in particular by
small businesses, that the draft guidance produced may not be
fully appropriate to the arbitration process. This is turn raises
the prospect that arbitrators’ decisions are likely to be
distorted. So Amendment 15 adds a layer to safeguard against such
an occurrence by asking the Government to bring statutory
guidance to Parliament before it is issued. In both the Commons
and in Committee we raised the need for a review of the Bill’s
provisions to ensure that the process is being applied
transparently, fairly and consistently. While we may not have
convinced the Government to include a specific review mechanism,
can the Minister assure the House that the operation of the Bill
will be carefully monitored?
Finally, on the many thorny questions of viability, can the
Minister tell us what engagement is being undertaken with
stakeholders to stress test the Government’s draft guidance on
this to make sure that it is fit for purpose? I look forward to
the noble Lord’s response.
(LD)
My Lords, I will speak to Amendments 2 and 15 in my name.
Amendment 2 is important because it is important to have the
arbitrators in place to deliver this service. The purpose of
Amendment 15 is to probe the guidance notes, because in Committee
that guidance was out for consultation. It is important to get a
chance to air some of the issues thrown up from it and to get a
sense from the Minister of where we are and when your Lordships’
House will see the final draft—I hesitate to use the phrase
“final draft”, because I hope he can confirm that it is a live
document and will develop over time alongside experience of this
process.
The noble Lord talked about stress testing. It would be helpful
if the Minister, during the process of monitoring the guidelines,
talked to those who have been involved in arbitration about their
experience so that they can be improved over time. Can he confirm
that he will?
The Government’s instinct to try to keep this simple is correct,
but sometimes simplicity can leave ambiguity. I think some of
that has come through in the responses they may well have
received. One way of removing that ambiguity is better use of
templates, which is one of the responses I have received from
people on this. Can the guidelines be better used to genuinely
short-circuit the process and therefore reduce costs for the
proponents’ way?
A second real issue is the definition of “viability”. We had a
debate on that at Second Reading and in Committee; I do not
propose to return to it, but there are issues around viability
that concern businesses, particularly seasonal ones. There is
scope within the guidelines—I have been given this advice by some
seasonal businesses—to better define the role of seasonality when
looking at the viability of these businesses. I would appreciate
the Minister’s thoughts on those issues.
Finally, there is an underlying suspicion from some tenants that
large-scale landlords, some of whom have experience in previous
types of dispute, will game the system and use their financial
muscle to take advantage. They fear that these well-resourced
landlords will go for the most expensive options, bid up the
costs and put the process beyond the means of small independent
traders. Will the Minister ensure that the arbitrators are
vigilant in this regard? I would be a bit hesitant here, because
there is a potential conflict of interest for those
arbitrators—the bigger the job, the larger the potential fee. We
then come to important issues around fees. The Minister needs to
set very clear guidelines to the arbitrators on that issue, such
that they are not bidding up the process or creating the
opportunity for big companies to flex their financial muscle.
(Con)
My Lords, I am grateful to the noble Baroness, Lady Blake of
Leeds—originally—and the noble Lord, , for raising their concerns about
ensuring that arbitration bodies have adequate arbitrator
capacity and administrative capability. I am sorry that the noble
Baroness cannot join us today and wish her a speedy recovery,
although of course I welcome the noble Lord, , who is participating in her
place. I agree that a number of crucial points have been made in
this short debate. The need for arbitrator capacity has been a
key consideration in designing the scheme.
The Bill adopts a market-based approach. This means that several
arbitration bodies will be approved and deemed suitable to
administer the scheme, a point which I will return to in a
moment. I believe this is the best way to ensure that we maximise
capacity, because arbitration bodies will be able to use their
intimate knowledge of matching arbitrator skills and experience
to cases. This Bill also helps maximise capacity by empowering
approved arbitration bodies to design and optimise their internal
workflows to make best use of their own and their arbitrators’
capacity.
The Government designed an approvals process which specifically
asked arbitration bodies to evidence their capacity. The deadline
for applying has now passed and an internal sifting process is
under way. As the sift is ongoing, I cannot comment on the
details yet, but I can state that 12 arbitration bodies have
applied. This is a very pleasing indicator of the interest being
shown in the scheme. To an extent, it shows that the market
mechanism looks to be working. Given the breadth and content of
the applications, I am confident that the approach we have taken
quite rightly empowers arbitration bodies to apply their
experience and expertise.
The noble Lord, , asked about the number of
cases. In light of recent intelligence from the mediation policy
in New South Wales, Australia, we have adjusted our current
estimate of the expected number of arbitration cases. It is
important to note that there is still some uncertainty around
these estimates, but in the central case we now estimate 2,500
arbitration cases in England and Wales. This is a significant
reduction from the previous estimate of 7,500 cases in the
central case. On that basis, if we were to discuss this Bill for
the next few months, we might have no cases left at all. The
noble Lord also asked about the sectors involved. I can confirm
that closed sectors included retail, hospitality, personal care,
leisure and the arts, and some others, but our evidence suggests
that most outstanding rent debt falls within these sectors.
The reduction in estimated cases is a positive sign for both the
scheme and the capacity of the arbitration market. As I have
stated, I hope this number will reduce further as landlords and
tenants continue negotiations. My officials are engaging
extensively with arbitration bodies to ensure that we offer as
much support as possible in helping them deliver this scheme. I
hope that reassures noble Lords that we are engaging with the
arbitration bodies on capacity and therefore request that this
amendment be withdrawn.
Turning to Amendment 15, I am grateful to the noble Lord and the
noble Baroness for raising the matter of laying statutory
guidance before Parliament. There is no doubt that the statutory
guidance will be very important to arbitrators’ performance of
their role. The Government take this very seriously. We want to
ensure that the guidance is genuinely useful to and used by
arbitrators. That is why we have already published a draft of the
guidance to allow for stakeholder input. This draft has been very
well received by stakeholders—in particular the guidance on the
assessment of the tenant’s viability, in answer to the noble
Lord, . My officials are having
ongoing discussions with stakeholders which will inform the final
version. This will take into account the comments made by the
noble Lord, . We expect the final guidance to
be published as soon as possible after Royal Assent.
We are committed to ensuring that the guidance is accessible to
all. That is why the final version will also be published on
GOV.UK. I am pleased to confirm that we will also write to all
Peers to share a copy of the guidance when published and place a
copy of it in the Libraries of both Houses. I assure the noble
Lord, , that if experience shows that
the guidance needs to be updated in any respect as the scheme
unfolds, we will do so and make sure that any such changes are
publicised.
I hope that noble Lords are reassured by this. We plan to make
the guidance widely available and share it with your Lordships. I
hope that, on this basis, the noble Lord will feel able to
withdraw his amendment.
6.00pm
(Lab)
My Lords, I thank the Minister for his detailed response to the
contributions and questions raised. It is good to know that only
2,500 cases remain. He is quite right that the longer we talk,
the fewer cases will be left. I am not entirely convinced that
this is proof that the market-based approach is working. It is
something else, probably about the voluntarily nature of
agreements entered into by people under the threat of the
arbitration process. Nevertheless, it is a positive sign.
As for the statutory guidance, we welcome being informed of
updates, but our preference would probably have been to have it
approved, although that is neither here nor there. I beg leave to
withdraw the amendment.
Amendment 2 withdrawn.
Clause 8: Functions of approved arbitration bodies
Amendment 3
Moved by
3: Clause 8, page 6, line 14, leave out paragraph (e)
Member’s explanatory statement
This amendment and the others in the name of the to Clause 8 are to avoid any
ambiguity as to the role of the appointing body and independence
of the arbitrator pursuant to the Arbitration Act 1996, to
prevent unilateral objections that might delay or frustrate the
process and to rely instead on the parties’ existing rights under
the Arbitration Act 1996 jointly to remove an arbitrator.
(LD)
My Lords, I rise to speak on behalf of the noble Earl, Earl
Lytton, who, as previously advertised, is the second member of
the “Covid 2” in this team. His absence is disappointing for two
reasons. First, he is not here to make these speeches and I have
to do so on his behalf, and secondly, his wisdom on the issue of
property is second to few in your Lordships’ House. The nature of
these amendments points to the direction of the advice that he
would have given your Lordships’ House had he been here, and I
will do my best to represent that. I am given to understand that
the amendments that the noble Earl tabled are supported by the
RICS, which focuses their purpose.
I will speak to them in groups. In the Clause 8 amendments, the
noble Earl’s point is that the appointing body that oversees the
function should not carry out more than a general monitoring of
the administrative good order of the process. The reason behind
the noble Earl’s point is that he is anxious to ensure that the
terms of Arbitration Act 1996 are not circumvented, so perhaps
the Minister can set the Bill in this context with respect to the
Act.
At the heart of the Clause 10 amendments is the expectation that
the appointing bodies do not materially alter their screening and
selection processes. The noble Earl’s point is that on potential
conflicts of interest, they are almost wholly reliant on
self-disclosure by potential appointees, so they would frequently
have no means of checking the responses for accuracy. I would
welcome the Minister’s view on this.
The purpose of the Clause 19 and Clause 20 amendments is to make
it permissible in a complex case, or cases, for the appointing
body to demand from the parties that a clear statement of the
issues and scope of evidence be placed before the arbitrator. Any
fee specified in advance should be able to rely on the statement,
but also on providing a broad estimate of the applicable
arbitrator time and rate, where a fixed fee is impractical. I
think what the noble Earl is driving at is that the arbitrators
should not be signing a blank cheque for the work they are going
to do; they deserve to have a scope to understand what it is they
will be arbitrating.
Those are the groupings as the noble Earl set out. For my part, I
hope to hear how the Minister and his department will balance
these important points from the noble Earl, , and the RICS, with the need to
keep things as simple and cost-effective as possible. I think
this is possible but I want to hear how the Government will
absorb these two issues. I beg to move Amendment 3.
(Lab)
The noble Lord, , raises the central concerns of
the struck-ill noble Earl, , about the expectations of
arbitrators. I would add that he seemed to suggest in Committee
that the role of arbitrators in this legislation is inconsistent
with the expectation of arbitrators in the Arbitration Act—that
is, they decide either one way or the other between two competing
cases, rather than trying to filter between the cases to find
some remedy between the two.
(Con)
My Lords, I apologise—I was caught short by the speed with which
we are moving through these amendments. Before I respond to these
points, I thank the noble Earl, , for the amendments he tabled.
I think everybody who heard him in Committee was impressed by his
erudition. I am sorry he is not able to join us to debate these
points, but on behalf of the House I thank the noble Lord, , for stepping into the breach and
for his impressive grasp of the technical matters underlying
these amendments.
I start by saying that I am fully aware of the concerns of
arbitration bodies seeking approval under the Bill and my
officials have been in continual contact with them to ensure that
their views are registered and dealt with appropriately.
The Bill differs in some aspects from the Arbitration Act 1996,
and provides that approved arbitration bodies have oversight over
arbitrators where they have appointed them. In answer to the
noble Earl, , this was deliberate, and it
gives certainty to landlords and tenants that arbitration will be
managed efficiently and any issues with the process dealt with
expeditiously. I can assure noble Lords that the oversight
function is not intended to be onerous and is primarily
administrative to ensure that the process runs smoothly. We do
not expect bodies to continually monitor proceedings, but only
step in where a party has a legitimate complaint or new
information comes to light, raising a concern. I hope this
reassures the noble Lord, .
Under the Bill, arbitration bodies can decide on unilateral
removal requests, and this was also deliberate to avoid adding to
pressure on the court system. The bodies should apply the same
principles in case law as the court, including that there is a
high bar to removing an arbitrator, and the parties should raise
any concerns promptly. Frivolous, vexatious or unsubstantiated
complaints should be quickly dismissed. Complaints of any
substance should be rare, given the rigorous pre-appointment
checks that bodies will doubtless carry out. I am pleased to
clarify the point raised by the noble Earl in Committee: it is
open to the approved arbitration bodies to charge a fee for
dealing with a removal application. The intention is that this
may disincentivise frivolous or vexatious complaints. In
addition, the arbitrator can require an obstructive party to pay
a greater share of the arbitration fees. We will include this
clarification in the guidance to which I referred earlier.
I appreciate that there is concern about the extent to which
arbitration bodies have immunity in respect of their functions.
This is an important point that has been raised; I am considering
it and will return to this issue at Third Reading.
(LD)
I appreciate that latter point, and the conflict of interest is a
concerning issue, particularly around how arbitrators are able
either to sign off on that or not be required to do so.
(Con)
The noble Lord makes a good point on that, and I hope that all
this provides reassurance to the noble Lord, , in his proxy role regarding
Amendments 3, 4 and 5 and that he will now not press them.
Turning to Amendments 8 and 9, the Bill’s arbitration scheme is
for parties that cannot reach agreement. It should not apply if
the protected rent debt is covered by a company or individual
voluntary arrangement, or by certain restructuring plans and
schemes under the Companies Act 2006. The Bill therefore does not
allow a reference to arbitration where such an arrangement has
been approved. If, when the Bill scheme is open, such an
arrangement has been proposed but not decided, the Bill seeks to
preserve the parties’ positions. This is why a party may apply
for arbitration but an arbitrator may not be appointed while the
decision on the arrangement is pending. If the proposed
arrangement is then approved, arbitration should not be
available, so, in that instance, the Bill prevents an arbitrator
being appointed.
This is important, but it should not be burdensome for approved
arbitration bodies. We will set out in guidance a clear and quick
process based on tenant disclosure to check whether there is an
approved or proposed arrangement to limit administrative burden
on the bodies. However, we should not use limited arbitral
capacity to determine this. I hope that I have explained
convincingly why Amendments 8 and 9 are not necessary or
appropriate.
Finally, I thank the noble Lord for raising the important issue
of arbitration fees. I turn first to Amendment 10. A cap on fees
differing with the complexity of the dispute may seem helpful;
however, complexity is subjective and difficult to define and
measure. It would therefore be hard to monitor adherence to such
a cap. Landlords and tenants may worry that their case would be
considered complex, resulting in higher fees, which may
discourage SMEs from applying. Of course, a key tenet of this
Bill is that this should be an inclusive process and open to all.
I hope that explains, for reasons of practicality, why I cannot
accept the amendment from the noble Earl and noble Lord on the
fee cap.
Amendments 11, 13 and 14 in effect remove the requirements for
advance payments of arbitrators’ fees and expenses and oral
hearing fees. However, it is fundamental that the parties know in
advance how much arbitration will cost to avoid deterring them
from using the scheme. A key gain—another key tenet—is that this
scheme is intended to be fast and low cost. The arbitration
mechanism is focused and based on the parties’ formal proposals
and supporting evidence. Oral hearings should concern those
proposals and evidence and should not require lengthy
cross-examination or experts. Consequently, costs should be
predictable.
Requiring fees to be paid in advance prevents a party frustrating
the process by refusing to pay. It also avoids arbitration bodies
having to take action to recover unpaid fees. Arbitration bodies
should be reassured that it is perfectly acceptable under the
Bill for them to set a higher fee for large-scale disputes, and
vice versa. For these reasons, I hope that the noble Lord will
understand that I must stick to the position that fees should be
paid in advance.
Finally, I turn to Amendment 12. The scheme must of course be
accessible to SMEs, as I have previously said, but the general
rule of splitting approved arbitration body fees and expenses
50:50 is important. That even split means that neither side is
incentivised to make the process more complex or lengthier than
it needs to be. I believe that we should be wary of interfering
with this. Of course, the exception is where a party has behaved
obstructively, in which case the arbitrator can require them to
pay more than 50% because of their conduct. As I have mentioned,
it is perfectly acceptable for approved arbitration bodies to set
fees payable in advance that differ depending on the size of the
parties involved. I hope that all provides a satisfactory
explanation to the noble Lord, . I thank him and of course the
noble Earl, , for their close attention to
these matters, and I hope that he will not press these
amendments.
6.15pm
(LD)
My Lords, I thank the Minister for his comprehensive answer on
these amendments. I am not sure how much cheer the noble Earl
will be getting from the answer, but he will I hope be able to
respond on his own account at Third Reading.
For my own part, I think the Minister’s response that neither
side is incentivised to increase the costs is a bit—if he does
not mind me saying so—naïve, because that is exactly what has
been happening where the big operators have flexed their muscle
to, in a sense, push the smaller operators into a corner. So I do
not agree with that point, and it is perhaps something that the
Minister could reconsider. With that, I beg leave to withdraw the
amendment.
Amendment 3 withdrawn.
Amendments 4 and 5 not moved.
Clause 9: Period for making a reference to arbitration
Amendments 6 and 7
Moved by
6: Clause 9, page 7, line 10, leave out from “period” to end and
insert “allowed by subsection (2) for making references to
arbitration in the case of—
(a) English business tenancies,(b) Welsh business tenancies,
or(c) English business tenancies and Welsh business
tenancies.”Member’s explanatory statement
The amendment would clarify that the power to extend the period
for making references to arbitration can be exercised for English
business tenancies or for Welsh business tenancies only, as well
as for both.
7: Clause 9, page 7, line 13, leave out subsection (5)
Member’s explanatory statement
The amendment would omit a definition that is redundant if Lord
Grimstone’s proposed amendment to Clause 23 at page 14, line 27
is made.
Amendments 6 and 7 agreed.
Clause 10: Requirements for making a reference to arbitration
Amendments 8 and 9 not moved.
Clause 19: Arbitration fees and expenses
Amendments 10 to 12 not moved.
Clause 20: Oral hearings
Amendments 13 and 14 not moved.
Clause 21: Guidance
Amendment 15 not moved.
Clause 23: Temporary moratorium on enforcement of protected rent
debts
Amendments 16 and 17
Moved by
16: Clause 23, page 14, line 27, leave out “for making references
to arbitration,” and insert “of six months beginning with that
day,”
Member’s explanatory statement
The amendment would mean that the moratorium period is no longer
defined directly by reference to the period under Clause 9(2) for
making of references to arbitration. Instead the period under
Clause 23(2)(b)(i) will end 6 months from Royal Assent, unless
extended.
17: Clause 23, page 14, line 30, at end insert—
“(2A) Subsection (2) is subject to any extension of the period
mentioned in paragraph (b)(i) that—(a) is made by or by virtue of
section (Alteration of moratorium period), and(b) has effect in
relation to the protected rent debt.”Member’s explanatory
statement
The amendment would acknowledge that the period ending as
specified in Clause 23(2)(b)(i) may be extended as provided for
in the new Clause proposed by another amendment in the name of
Lord Grimstone.
Amendments 16 and 17 agreed.
Amendment 18
Moved by
18: After Clause 23, insert the following new Clause—
“Alteration of moratorium period
(1) In this section “extension regulations” means regulations
under section 9(3) extending the period allowed by section 9(2)
for making references to arbitration.(2) Where extension
regulations made by virtue of section 9(3)(a) or (c) extend that
period in the case of English business tenancies, the period
specified in section 23(2)(b)(i), so far as it applies in the
case of a protected rent debt under an English business tenancy,
is extended for the same period of time.(3) Subsection (4) below
applies where extension regulations made by virtue of section
9(3)(b) or (c) extend that period in the case of Welsh business
tenancies.(4) The Secretary of State may by regulations made by
statutory instrument extend the period specified in section
23(2)(b)(i), so far as it applies in the case of a protected rent
debt under a Welsh business tenancy, for the same period of
time.(5) Regulations under subsection (4) must provide for the
extension referred to in that subsection—(a) to have effect for
the purposes of this Part including the purposes of Schedule 2,
or(b) to have effect for the purposes of this Part other than the
purposes of Schedule 2.(6) The power to make the provision
referred to in subsection (5)(a) is exercisable only with the
consent of the Welsh Ministers to the extension having effect for
the purposes of Schedule 2 other than the purposes of paragraph
3(6) and (7).(7) A statutory instrument containing regulations
under subsection (4) is subject to annulment in pursuance of a
resolution of either House of Parliament.”Member’s explanatory
statement
The amendment deals with the effect of use of the Clause 9(3)
power on the moratorium period under Clause 23(2). For debts
under Welsh business tenancies the effect will depend on
regulations, which would require the consent of the Welsh
Ministers if a change in the moratorium period affects Schedule 2
(apart from paragraph 3(6) and (7), dealing with reserved
matters).
Amendment 18 agreed.
Clause 27: Power to apply Act in relation to future periods of
coronavirus control
Amendments 19 to 24
Moved by
19: Clause 27, page 15, line 39, at end insert—
“(1A) Regulations under this section may—(a) be made so as to
apply in relation to—(i) English business tenancies,(ii) Welsh
business tenancies, or(iii) English business tenancies and Welsh
business tenancies;(b) exclude the provisions mentioned in
subsection (7B)(a) to (c) from the provisions being re-applied in
relation to Welsh business tenancies.”Member’s explanatory
statement
The amendment would enable regulations under Clause 27 to be made
just for English business tenancies or just for Welsh business
tenancies (as well as for both) and also to exclude (in the case
of Welsh business tenancies) provisions of the Act which deal
with devolved matters in Wales.
20: Clause 27, page 16, leave out lines 15 and 16 and insert—
“(7) Regulations under this section may—”Member’s explanatory
statement
The amendment would omit the current specific power to exclude
any of the provisions of the Act from applying again by virtue of
regulations under Clause 27.
21: Clause 27, page 16, line 17, after “such” insert
“necessary”
Member’s explanatory statement
The amendment would limit the power to modify the provisions of
the Bill being re-applied to modifications necessary for the
re-applied provisions of the Act to work in the circumstances in
which the power is being used.
22: Clause 27, page 16, line 19, leave out from “provision” to
first “for” in line 20
Member’s explanatory statement
The amendment would limit subsection (7)(c) to making different
provision for England and for Wales.
23: Clause 27, page 16, line 23, at end insert—
“(7A) For the purposes of subsection (7)(b)—(a) “modifications”
means omissions, additions or variations, and(b) modifications
are “necessary” if they appear to the Secretary of State to be
necessary for the provisions being re-applied to operate
correctly in relation to business tenancies adversely affected by
the closure requirements in question.(7B) The power under this
section is exercisable only with the consent of the Welsh
Ministers so far as it relates to the re-application, in relation
to Welsh business tenancies, of—(a) Schedule 2 apart from
paragraph 3(6) and (7),(b) section 23 so far as relating to
Schedule 2 apart from paragraph 3(6) and (7), and(c) Part 1 and
this Part, so far as relating to the provision mentioned in
paragraphs (a) and (b).”Member’s explanatory statement
The amendment would require the consent of the Welsh Ministers to
regulations re-applying the moratorium provisions of Part 3, with
the exception of paragraph 3(6) and (7) of Schedule 2 (the
subject-matter of which is reserved under Welsh devolution
legislation).
24: Clause 27, page 16, line 24, leave out “The regulations” and
insert “Regulations under this section”
Member’s explanatory statement
This is a drafting amendment that would secure consistency of
expression in Clause 27.
Amendments 19 to 24 agreed.
Amendment 25
Moved by
25: After Clause 27, insert the following new Clause—
“Concurrent power for Welsh Ministers to apply moratorium
provisions again
(1) The Welsh Ministers may exercise the power conferred by
section 27, concurrently with the Secretary of State, so far as
it relates to the re-application, in relation to Welsh business
tenancies, of—(a) Schedule 2 apart from paragraph 3(6) and
(7),(b) section 23 so far as relating to Schedule 2 apart from
paragraph 3(6) and (7), and(c) Part 1 and this Part, so far as
relating to the provision mentioned in paragraphs (a) and (b).(2)
Section 27 has effect in relation to regulations made by the
Welsh Ministers by virtue of this section as if—(a) references to
the Secretary of State were to the Welsh Ministers,(b) subsection
(1A)(a)(i) and (iii) and (b) were omitted,(c) in subsection
(7)—(i) the references in paragraph (b) to provisions of this Act
were references to provisions mentioned in subsection (1)(a) to
(c) above, and(ii) the reference in paragraph (d) to an Act of
Parliament included a reference to an Act or Measure of Senedd
Cymru,(d) subsection (7B) were omitted, and(e) in subsection
(8)(b), for “each House of Parliament” there were substituted
“Senedd Cymru”.(3) In Schedule 7B to the Government of Wales Act
2006 (general restrictions on legislative competence of Senedd
Cymru), in paragraph 11(6)(b) (exceptions to restrictions
relating to Ministers of the Crown)—(a) omit the “or” at the end
of paragraph (vii), and(b) after paragraph (viii) insert “;
or(ix) section 27 of the Commercial Rent (Coronavirus) Act
2022.””Member’s explanatory statement
The amendment would insert a new Clause enabling the Welsh
Ministers, concurrently with the Secretary of State, to use the
section 27 power to apply again the moratorium provisions
specified in subsection (1)(a) to (c) of the new clause in
relation to Welsh business tenancies affected by new coronavirus
restrictions in Wales.
Amendment 25 agreed.
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