EXPLANATORY NOTE
(This note is not part of the Regulations)
The Renting Homes (Wales) Act 2016 (anaw 1) (“the 2016 Act”) changes the renting landscape in Wales by, amongst other things, introducing the concept of “standard” and “secure” “occupation contracts”.
These Regulations amend Schedule 12 to the 2016 Act. Schedule 12 sets out provision about tenancies and licences that existed before the 2016 Act came into force and which convert into occupation contracts on the “appointed day” (the day on which the 2016 Act is fully brought into force). These are referred to as “converted contracts”. Schedule 12 is designed to ensure that the 2016 Act will work in relation to such contracts.
Regulation 5 inserts new paragraph 2A which provides that licences held by 16 and 17 year olds which are secure tenancies or assured agricultural occupancies (“AAOs”) convert into occupation contracts. The licensee will be the contract-holder and the 2016 Act will apply to the contract in the same way as it does to any other converted contract.
These Regulations make the following amendments that concern supported accommodation and outline which tenancies and licences can, and cannot, be supported standard contracts (see Part 8 of the 2016 Act).
- Regulation 4(b) inserts new sub-paragraph (5) into paragraph 2. This amendment disapplies Part 5 of Schedule 2 for any tenancy which existed immediately before the appointed day. The effect of this amendment is to ensure a landlord cannot stop a tenancy that relates to supported accommodation from converting and becoming an occupation contract. Although Part 5 of Schedule 2 cannot meaningfully apply to a licence which is more than 6 months old, the amendment puts this beyond doubt.
- Regulation 8 inserts new paragraph 6A which provides that only an assured shorthold tenancy or a licence (other than a licence which was a secure tenancy) which relates to supported accommodation is permitted to convert into a supported standard contract.
- Regulation 14 inserts new paragraph 24A which provides that sections 144 (mobility) and 145 (temporary exclusion) do not apply to a converted contract that is a supported standard contract and that was, immediately before the appointed day, an assured shorthold tenancy.
These Regulations make the following amendments in relation to “starter tenancies”.
- Regulation 7 substitutes paragraph 5 to expand the converted contracts that have effect as an introductory standard contract (see section 16 of, and Schedule 4 to, the 2016 Act). The amendment adds (to the existing provision for introductory tenancies) assured shorthold tenancies that were starter tenancies provided the landlord was a registered social landlord or private registered provider of social housing (with certain exceptions).
- As a consequence of the amendment made to paragraph 5, paragraph 23 is amended (by regulation 13). Regulation 13(a) and (b) amend paragraphs 23(3)(c) and (6) to update the references, in paragraphs 1(7) and 2 of Schedule 4, to the “introduction date” of the contract to include the introduction date of the starter tenancy. Regulation 13(c) substitutes paragraph 23(7) to modify the application of the Act to deal with situations where an extension has already been given under a starter tenancy.
Regulation 10 inserts new paragraph 13A which provides that the deposit scheme provisions of the 2016 Act only apply to a converted contract that, immediately before the appointed day, was an assured shorthold tenancy.
Regulation 11 inserts new paragraph 13B which provides that where there is a converted periodic standard contract which, immediately before the appointed day, was an assured tenancy containing a term about rent variation, the rent can only be varied in accordance with that term, and the landlord cannot use section 123 to vary the rent.
Regulation 12 amends paragraph 15, which concerns variation of rent. Regulation 12(a) amends paragraph 15(1) to ensure there is no tension between that provision and paragraph 13B. In essence, this amendment reinforces that where a converted contract falls within paragraph 13B, paragraph 15 does not apply.
Regulation 12(b) amends paragraph 15(3) so that the contract-holder under the types of contract referred to in paragraphs 15(3)(b) or (c) can, under regulations made under paragraph 15(2), apply for a determination of rent for the dwelling.
A number of the amendments made by these Regulations concern the conversion of AAOs.
- Regulation 3 amends paragraph 1 to include some additional definitions. The most significant is the way in which “assured tenancy” is read in Schedule 12; the amendment removes any doubt that it includes an AAO which, immediately before the appointed day, was treated as an assured tenancy under section 24(3) of the Housing Act 1988.
- Regulation 4(b) inserts new sub-paragraph (6) into paragraph 2. The effect of this amendment is that existing AAOs that would not otherwise be capable of becoming occupation contracts (because no rent or other consideration is payable under them) will convert into occupation contracts on the appointed day.
Regulation 19(b) omits paragraph 32(4). The effect of this amendment is that a new contract which arises under section 184(2) or is within section 184(6) is a substitute contract for the purposes of Schedule 12. As a consequence of omitting paragraph 32(4), regulation 15 amends paragraph 25A.
The amendments to paragraph 25A provide that where a substitute contract is a periodic standard contract (which either arises under section 184(2) or is within section 184(6)) the landlord must give 6 months’ notice under section 173 and the landlord cannot give a section 173 notice within the period of 4 months, starting with the date on which the contract-holder become entitled to occupy the dwelling under the original tenancy or licence.
Regulation 19(c) inserts new sub-paragraph (8) into paragraph 32. This amendment means that in relation to a substitute contract that is a periodic standard contract arising under section 184(2), the minimum notice period under section 174 is 6 months (not 2 months). This amendment also means that in relation to a substitute contract that is within section 184(6), paragraphs 25A(2)(a), 25B, 25C and 25D are omitted.
These Regulations also make the following amendments:
- Regulation 4(a) disapplies paragraph 7(3)(k)(i) of Schedule 2 in relation to a tenancy or licence which immediately before the appointed day was a secure or assured tenancy; removing the prohibition on this type of asylum-seeker accommodation from converting to the relevant occupation contract on the appointed day.
- Regulation 6(a) and (b) make minor amendments to paragraph 4. Notice of a standard contract is not given “under” section 11(2)(b) of the 2016 Act; it is given under section 13. Section 11(2)(b) simply describes the notice that has to be given. These amendments seek to better reflect this position.
- Regulation 9 makes an amendment to rectify a minor drafting error.
- Regulation 16 amends paragraph 25B to provide that the provisions of that paragraph do not apply to an assured tenancy that was not an assured shorthold tenancy.
- Regulation 17 contains a minor amendment to put it beyond doubt that paragraph 25D could not apply to a fixed term standard contract that was a fixed term secure tenancy or (subject to some exemptions) a fixed term assured tenancy.
- Regulation 18 amends paragraph 29(1) to narrow its purported application to only periodic assured tenancies. Prior to the appointed day, in its application to Wales, Ground 7 of Schedule 2 to the Housing Act 1988 only applied to periodic assured tenancies and this amendment reflects that position.
- Regulation 19(a) makes textual amendments to aid clarity.
The Welsh Ministers’ Code of Practice on the carrying out of Regulatory Impact Assessments was considered in relation to these Regulations. As a result, it was not considered necessary to carry out a regulatory impact assessment as to the likely costs and benefits of complying with these Regulations.