Regulation 15 Requirement to offer an MRO leaseI1

A pub-owning business must offer their tied-pub tenant an MRO lease at the tenant’s request.

But a pub-owning business need not offer an MRO lease where—

Paragraph (2)(a) does not apply where a pub has been occupied for a period of more than one year under successive leases of one year or less.

If a pub-owning business relies upon an exemption under paragraph (2) to refuse an offer of an MRO lease, the pub-owning business must inform their tenant.

The investment exception applies for 5 years from the date an investment agreement was agreed, where the pub-owning business is investing in capital improvement works to the pub F3the cost of which is equal to or higher than the greater of—

The investment exception does not apply unless—

Paragraph 6(c) does not apply where the pub-owning business has entered into an investment agreement preceding the date these Regulations come into force.

The investment exception ceases to apply where capital improvement works arranged under an investment agreement have, without reasonable excuse—

For the purposes of paragraph (8), “reasonable excuse” includes where the works do not start, or stop, due to circumstances beyond the control of the pub-owning business or the tenant.

In this regulation—

• “investment agreement” means a written agreement between the pub-owning business and their tenant for the pub-owning business to invest in capital improvement works to the pub,

• “capital improvement works” does not include routine maintenance, works carried out under landlord repairing obligations, works carried out under dilapidations requirements, or works to make a pub safe and compliant with health and safety requirements before letting it to the tenant.