The English Devolution and Community Empowerment Act 2026 has banned upwards-only rent reviews (“UORR”) in new and renewal commercial leases. The Landlord and Tenant Act 1954 will be amended to incorporate these changes.
The Act received Royal Assent on 29 April 2026 and formally prohibits upwards only rent review clauses in commercial leases in England and Wales.
Historically, UORR clauses in commercial leases in England and Wales permitted the rent to remain the same or increase but the rent could never fall, even if changes to the market decreased new rents for similar premises.
The ban will apply to new business tenancies and renewal leases, including those contracted out of the provisions of the Landlord and Tenant Act 1954.
Implementation is expected no earlier than 2027 and it is anticipated that there will be limited retrospective effect for certain renewal arrangements entered into on or after 17 March 2026.
Given the retrospective effect, landlords and tenants should carefully review any pending transactions.
Landlords can of course incorporate rent increases when negotiating and drafting the terms of a new lease. These could either be fixed increases on particular dates or increases on particular dates based on the Consumer or Retail Prices Index. These options would now appear to be the main ways for landlords to increase rent during the term of a commercial lease.
