Information For New Tenants

Transcription

1 FACTSHEET NUMBER 1 Information For New Tenants JULY 2016

2 Contents OVERVIEW... 3 DETAILED FACTSHEET Information that must be provided to new tenants at the start of a new tenancy Training Reports Premises Rent proposal Information requirements that apply to short agreements and to franchises

3 Information for New Tenants OVERVIEW Pubs Code requires landlords to provide tied-pub tenants with a minimum level of information and advice before a tenancy is agreed. The landlord must: Advise the tied tenant to complete pubs entry training ; Ensure the tied tenant has prepared a sustainable business plan; Advise the tied tenant to inspect the premises thoroughly, including obtaining advice from a qualified surveyor; Provide a rent proposal; and, Supply a range of other information (e.g. insurance, paying of deposits) as set out in the Pubs Code. Different information requirements apply to short term agreements see Factsheet No 10 1 and franchises see Factsheet No

4 DETAILED FACTSHEET 1. Information that must be provided to new tenants at the start of a new tenancy 1.1. The Pubs Code requires pub-owning businesses (POBs) to provide all tied pub tenants (TPTs) (both existing and prospective) who are taking on a new tenancy with a minimum level of information and advice before the agreement is made: 2. Training 2.1. The POB must advise the TPT to complete pubs entry training on what is entailed in running a tied pub before entering into the new agreement unless the TPT is an experienced tenant i. The Code does not specify particular training courses or require the TPT to follow the advice. 3. Reports 3.1. The POB must ensure the TPT has prepared a sustainable business plan ii that: has been prepared with reference to independent professional advice such as business, legal, property and rental valuation advice; includes forecasts of income and expenditure for the tenancy period; a sensitivity analysis of the impact of increases or decreases in income on costs and profitability; and the impact of the indexation of rent or other costs; contains a forecast of income and net profit that the POB views as reasonable and realistic Before the tenant prepares the business plan, the POB must provide the TPT with reports to help benchmark the expected performance of the tied pub against similar pubs (or information on where and how to obtain them) The required reports are ones that are publicly available; that analyse the trading costs of tied pubs in the UK or regionally; that analyse the costs of the tenancies of those pubs; and that provide data against which the TPT can compare the performance of their pub iii. It does not include reports the TPT confirms to the POB it has already read. The POB must advise the tenant to consult the report. 4. Premises 4.1. The POB must advise the TPT to inspect the premises thoroughly (including any part intended to be used as the TPT s home); and to obtain the advice of a 4

5 qualified surveyor who has professional experience relating to tied pubs iv. Identification and management of initial works which must be carried out are to be provided by the POB v. 5. Rent proposal 5.1. This must include vi : the rent; all other proposed terms of the tenancy; all of the information listed in Schedule 2 of the Pubs Code; and any other information required by the TPT to understand or negotiate the rent; and that the POB can reasonably be expected to provide The POB must comply within 7 days with any reasonable request from the TPT for further information; and must advise the TPT to obtain independent professional advice before agreeing the rent vii All the information listed in Schedule 1 of the Pubs Code must be provided by the POB before entering into the agreement which includes (though see Schedule 1 for full list): a copy of the Pubs Code and the POB s own code of practice, if it has one; the nature of the tenancy including whether it is protected under the Landlord and Tenant Act 1954; its start and end dates; and the identity of any superior landlord; details of the premises and its condition including any premises licensing conditions; recent enforcement action and other restrictions on the use of the premises; any specific problems in the premises; and any foreseeable material changes in local commercial conditions; maintenance and repair obligations and procedures; the TPT s obligations in respect of tied products and services; whether the tenancy may be assigned or sold, and the procedures involved; the advice and support available to the TPT from the POB; the parties responsibility for insuring the pub; arrangements for the paying of deposits; the indexation of the rent; and any fees, charges or financial penalties; any obligations in respect of staff already working in the pub viii ; 5

6 how any alleged breaches of the tenancy by the TPT or of the Pubs Code by the POB will be dealt with. 6. Information requirements that apply to short agreements and to franchises Different provisions apply to: Certain tenancies-at-will and short-term agreements, known collectively as Short Agreements (see Factsheet No 10 for further details); and Pub franchises (see Factsheet No 11 for further details). 7. Disputes in relation to the provision of information in accordance with the Code may be referred to the PCA for arbitration (see Factsheet 12 for further details). 6

7 i See regulation 9 of the Pubs Code ii See regulation 10 of the Pubs Code iii See regulation 10(3) of the Pubs Code iv See regulation 13(1) of the Pubs Code v See regulation 16 of Schedule 1 to the Pubs Code vi See regulation 16(1) of the Pubs Code vii See regulation 18 of the Pubs Code viii Under the Transfer of Undertakings (Protection of Employment) Regulations 2006