The upward-only rent review ban may already be affecting lease negotiations — here’s why 17 March matters

It is now widely accepted this change in the law will come about, but a recent amendment to the draft English Devolution and Community Empowerment Bill which contains the provisions of the ban has shifted the goalposts a little further. In practical terms, the recent amendment means that lease renewals that are pursuant to an option dated on or after 17 March 2026 will be caught by the ban.  Therefore, the new Act will have retrospective effect for these leases, which was not something previously envisaged.   17 March 2026 now looks like a date that will influence behaviours and documentation even before the relevant legislation is in force.

Where the Bill is now - and what it is trying to do

The UORR proposals sit within a wider devolution Bill.  Part 5 of the Bill includes measures to ban UORRs, meaning that the UORR drafting in many new and renewal business tenancies would become unenforceable once the relevant provisions are commenced. The ban will apply to all business tenancies.   The effect of which will be to render any review clause which contains a UORR to have no effect. Instead, the new rent shall be determined by the methodology contained in the lease. The Bill is currently in the final stages of the Parliamentary process, and it is expected to receive Royal Assent in early summer 2026. The commencement date is not then anticipated until 2027/2028. 

The most significant recent development of the Bill is the partial retrospectivity that the recent amendment creates for tenancy renewal arrangements. The risk is no longer limited to leases granted after the eventual commencement date of the legislation in that new lease entered into post 17 March 2026 with renewal options mean those renewal leases will be caught by the ban.

This matters because renewal options are not niche. They are commonly used to manage security of tenure strategy, fit-out economics and long-term occupational planning and they often sit alongside assumptions about rent review “certainty” in investment models and lending decisions.

What does the ‘ban’ mean in practice?

At a high level, the proposals aim to stop rent review clauses that can only move one way where the post-review rent is not known at the outset. A practical consequence is that rent would instead be determined using the lease methodology (open market, index-linked, turnover etc.), but without the upward-only ‘ratchet’, so the reviewed rent could be higher, lower or unchanged, depending on the mechanism and conditions.

As it stands a landlord granting a new lease now may still include a valid upwards only rent review clause, but this will be for the current term only and should this lease contain an option to renew, the renewal lease would be caught by the ban. Essentially preventing landlords from securing the previous rent review mechanism before the legislation comes into force.

Timing remains awkward. Commencement may still be some way off with some in the market predicting as early as 2027, whilst others suggesting it may be 2028, but documentation agreed now can influence whether future renewals fall within scope because of the 17 March 2026 line in the sand.

What landlords, tenants, investors and lenders should do now

This is not the time for panic but it’s also not one to leave on the ‘watchlist’. Start by auditing anything agreed since 17 March 2026 and look beyond the lease itself: renewal mechanics can sit in an option clause, a side letter, a separate option deed, or wider transaction documents that effectively create a renewal arrangement. If any of that paperwork was entered into on or after 17 March, treat it as a priority for scrutiny.

In parallel, revisit ‘standard’ assumptions in heads of terms: if the deal model assumes an upward-only dynamic will carry through into a renewal lease, that may need caveats or a rethink where the renewal route is being created post 17 March.

Consider alternative rent structures early, while there’s room to negotiate commercially, rather than trying to fix it once heads of terms are agreed. That might mean stepped rents which are not caught by the ban, index-linked reviews that move both ways, or other mechanisms that provide predictability without a one-way ratchet, such as shorter terms. Don’t forget the knock-on effects: if the market starts to distinguish between ‘pre‑regime’ and ‘post‑regime’ characteristics, valuation and funding narratives may shift, so ensure those assumptions are aligned. Finally, keep an eye on the moving parts: even late-stage legislation can change, so track progress and credible updates as the final wording settles.

Final thought

The UORR ban was always going to be a major shift for the England and Wales commercial leasing market. The newer point is that the debate is no longer purely about the future. 17 March 2026 has created a practical dividing line for renewal arrangements being negotiated right now - so assume today’s option drafting may be tomorrow’s battleground and negotiate with the new regime firmly in mind.