Paragraph 2 Condition A: a business tenancyF1

(1)

Condition A is met if Part 2 of this Act—

(a)

applies to the tenancy, or

(b)

has the potential to apply to the tenancy.

(2)

In the following paragraphs of this Schedule—

(a)

the tenancy to which Part 2 applies, or has the potential to apply, is referred to as the “existing tenancy”;

(b)

the premises let under the existing tenancy are referred to as the “relevant premises”.

(3)

For the purposes of this paragraph, Part 2 has the potential to apply to the existing tenancy if—

(a)

Part 2 cannot apply to the existing tenancy because—

(i)

none of the relevant premises are occupied by the tenant, or

(ii)

the relevant premises are or include premises which are occupied by the tenant, but none of those premises are so occupied for the purposes of a business carried on by the tenant or for those and other purposes,

(b)

the terms of the tenancy include terms (the “permitted use terms”) which would permit the tenant to occupy relevant premises for the purposes of a business carried on by the tenant (whether the terms permit occupation for the purposes of business generally, a specific business or a specific kind of business) or for those and other purposes, and

(c)

if the tenant were to occupy relevant premises in accordance with the permitted use terms (and taking into account all other circumstances), Part 2 of this Act would apply to the tenancy.

(4)

For the purposes of sub-paragraph (3)(b), terms of the existing tenancy which—

(a)

would prohibit the tenant from occupying relevant premises for some purposes, but

(b)

would not prohibit the tenant from occupying relevant premises for other purposes,

are to be regarded as terms which would permit the tenant to occupy relevant premises for the purposes which are not prohibited.

(5)

Sub-paragraph (3) must be construed as one with section 23(1).

Annotations

Textual amendments

F1: Sch. 7B inserted (29.4.2026 for specified purposes) by English Devolution and Community Empowerment Act 2026 (c. 23), s. 108(1)(6), Sch. 37 para. 2