Legalize / United Kingdom / Public General Act

Tenant Fees Act 2019

Type Public General Act

Publication 2019-02-12

State In force

Department Statute Law Database

Source legislation.gov.uk

Reform history JSON API

Prohibitions etc applying to landlords and letting agents

Prohibitions applying to landlords

1

(1) A landlord must not require a relevant person to make a prohibited payment to the landlord in connection with a tenancy of housing in England.

(2) A landlord must not require a relevant person to make a prohibited payment to a third party in connection with a tenancy of housing in England.

(3) A landlord must not require a relevant person to enter into a contract with a third party in connection with a tenancy of housing in England if that contract is—

(a) a contract for the provision of a service, or

(b) a contract of insurance.

(4) Subsection (3) does not apply if the contract is for—

(a) the provision of a utility to the tenant, or

(b) the provision of a communication service to the tenant.

(5) A landlord must not require a relevant person to make a loan to any person in connection with a tenancy of housing in England.

(6) For the purposes of this section, a landlord requires a relevant person to make a payment, enter into a contract or make a loan in connection with a tenancy of housing in England if and only if the landlord—

(a) requires the person to do any of those things in consideration of the grant, renewal, continuance, variation, assignment, novation or termination of such a tenancy,

(b) requires the person to do any of those things pursuant to a provision of a tenancy agreement relating to such a tenancy which requires or purports to require the person to do any of those things in the event of an act or default of a relevant person,

(c) requires the person to do any of those things pursuant to a provision of a tenancy agreement relating to such a tenancy which requires or purports to require the person to do any of those things if the tenancy is varied, assigned, novated or terminated,

(d) enters into a tenancy agreement relating to such a tenancy which requires or purports to require the person to do any of those things other than in the circumstances mentioned in paragraph (b) or (c),

(e) requires the person to do any of those things—

(i) as a result of an act or default of a relevant person relating to such a tenancy or housing let under it, and

(ii) otherwise than pursuant to, or for the breach of, a provision of a tenancy agreement, or

(f) requires the person to do any of those things in consideration of providing a reference in relation to that person in connection with the person's occupation of housing in England.

(7) For the purposes of this section, a landlord does not require a relevant person to make a payment, enter into a contract or make a loan if the landlord gives the person the option of doing any of those things as an alternative to complying with another requirement imposed by the landlord or a letting agent.

(8) Subsection (7) does not apply if—

(a) the other requirement is prohibited by this section or section 2 (ignoring subsection (7) or section 2(6)), or

(b) it would be unreasonable to expect a relevant person to comply with the other requirement.

(9) In this Act “relevant person” means—

(a) a tenant, or

(b) subject to subsection (10), a person acting on behalf of, or who has guaranteed the payment of rent by, a tenant.

(10) The reference in subsection (9)(b) to a person does not include—

(a) a local housing authority within the meaning of the Housing Act 1985 (see section 1 of that Act),

(b) the Greater London Authority, or

Prohibitions applying to letting agents

2

(1) A letting agent must not require a relevant person to make a prohibited payment to the letting agent in connection with a tenancy of housing in England.

(2) A letting agent must not require a relevant person to make a prohibited payment to a third party in connection with a tenancy of housing in England.

(3) A letting agent must not require a relevant person to enter into a contract with the agent or a third party in connection with a tenancy of housing in England if the contract is—

(a) a contract for the provision of a service, or

(b) a contract of insurance.

(4) A letting agent must not require a relevant person to make a loan to any person in connection with a tenancy of housing in England.

(5) For the purposes of this section, a letting agent requires a relevant person to make a payment, enter into a contract or make a loan in connection with a tenancy of housing in England if and only if the letting agent—

(a) requires the person to do any of those things in consideration of arranging the grant, renewal, continuance, variation, assignment, novation or termination of such a tenancy,

(b) requires the person to do any of those things pursuant to a provision of an agreement with the person relating to such a tenancy which requires or purports to require the person to do any of those things in the event of an act or default of a relevant person,

(c) requires the person to do any of those things pursuant to a provision of an agreement with the person relating to such a tenancy which requires or purports to require the person to do any of those things if the tenancy is varied, assigned, novated or terminated,

(d) requires the person to do any of those things—

(i) as a result of an act or default of a relevant person relating to such a tenancy or housing let under it, and

(ii) otherwise than pursuant to, or for the breach of, an agreement entered into before the act or default, or

(e) requires the person to do any of those things in consideration of providing a reference in relation to that person in connection with the person's occupation of housing in England.

(6) For the purposes of this section, a letting agent does not require a relevant person to make a payment, enter into a contract or make a loan if the letting agent gives the person the option of doing any of those things as an alternative to complying with another requirement imposed by the letting agent or the landlord.

(7) Subsection (6) does not apply if—

(a) the other requirement is prohibited by this section or section 1 (ignoring subsection (6) or section 1(7)), or

(b) it would be unreasonable to expect a relevant person to comply with the other requirement.

(8) This section does not apply to a requirement imposed by a letting agent on a relevant person if—

(a) the requirement is imposed by the letting agent in consideration of providing a service to a tenant,

(b) as part of that service the agent finds housing for the tenant to rent and the tenant rents that housing, and

(c) the agent does not act on behalf of the landlord of that housing, whether in relation to that housing or any other housing.

Prohibited and permitted payments

3

(1) For the purposes of this Act a payment is a prohibited payment unless it is a permitted payment by virtue of Schedule 1.

(2) The Secretary of State may by regulations made by statutory instrument amend Schedule 1 by adding, modifying or removing a reference to a permitted payment.

(3) The power in subsection (2) does not extend to removing rent from the categories of payment which are permitted payments under this Act.

(4) Regulations under this section—

(a) may make different provision for different purposes;

(b) may make supplemental, incidental, consequential, transitional, transitory or saving provision.

(5) Subject to subsection (6), a statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

(6) Subsection (5) does not apply to a statutory instrument containing only regulations under this section which amend the amount for the time being set out in paragraph 6(2)(a) of Schedule 1 (maximum amount of permitted payment on variation, assignment or novation of a tenancy) for the purposes only of reflecting changes in the value of money.

(7) A statutory instrument to which subsection (6) applies is subject to annulment in pursuance of a resolution of either House of Parliament.

Effect of a breach of section 1 or 2

4

(1) A term of a tenancy agreement which breaches section 1 is not binding on a relevant person.

(2) A term of an agreement between a letting agent and a relevant person which breaches section 2 is not binding on a relevant person.

(3) Where a term of an agreement is not binding on a relevant person as a result of this section, the agreement continues, so far as practicable, to have effect in every other respect.

(4) If a relevant person makes a loan to a person pursuant to a requirement which breaches section 1(5) or 2(4), the loan is repayable by the borrower to the relevant person on demand.

Treatment of holding deposit

5

Schedule 2 makes provision about the treatment of holding deposits.

Enforcement

Enforcement by local weights and measures authorities

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(1) It is the duty of every local weights and measures authority in England to enforce in its area—

(a) section 1 (prohibitions applying to landlords),

(b) section 2 (prohibitions applying to letting agents), and

(2) The duty in subsection (1) is subject to sections 14(5) (enforcement by another enforcement authority) and 26 (enforcement by the lead enforcement authority).

(3) Where a breach of section 1 or 2 or Schedule 2 relates to housing which is located in the area of more than one local weights and measures authority, the breach is taken to have occurred in each of those areas.

(4) A local weights and measures authority in England must have regard to any guidance issued by the Secretary of State or the lead enforcement authority (if not the Secretary of State) about the exercise of its functions under this Act.

(5) For the investigatory powers available to a local weights and measures authority in England for the purposes of enforcing this Act, see Schedule 5 to the Consumer Rights Act 2015.

(6) In paragraph 10 of Schedule 5 to the Consumer Rights Act 2015 (duties and powers to which Schedule 5 applies), at the appropriate place insert “ section 6 of the Tenant Fees Act 2019 ”.

Enforcement by district councils

7

(1) A district council which is not a local weights and measures authority may enforce sections 1 and 2 and Schedule 2.

(2) A district council must have regard to any guidance issued by the Secretary of State or the lead enforcement authority (if not the Secretary of State) about the exercise of its functions under this Act.

(3) For the investigatory powers available to a district council for the purposes of enforcing this Act, see Schedule 5 to the Consumer Rights Act 2015.

(4) In paragraph 10 of Schedule 5 to the Consumer Rights Act 2015 (duties and powers to which Schedule 5 applies), at the appropriate place insert “ section 7 of the Tenant Fees Act 2019 ”.

(5) In this Act “enforcement authority” means—

(a) a local weights and measures authority in England, or

(b) a district council which is not a local weights and measures authority.

Financial penalties

8

(1) Where an enforcement authority is satisfied beyond reasonable doubt that a person has breached section 1 or 2 or Schedule 2, the authority may impose a financial penalty on the person in respect of the breach.

(2) The financial penalty—

(a) may be of such amount as the authority determines, but

(b) subject to subsection (3), must not exceed £5,000.

(3) If the enforcement authority is satisfied beyond reasonable doubt that the person has committed an offence under section 12, the financial penalty—

(a) may exceed £5,000, but

(b) must not exceed £30,000.

(4) An enforcement authority may not impose a financial penalty under this section on a person in respect of any conduct amounting to an offence under section 12 if—

(a) the person has been convicted of an offence under that section in respect of the conduct,

(b) criminal proceedings for an offence under that section in respect of the conduct have been instituted against the person and the proceedings have not been concluded, or

(c) criminal proceedings for an offence under that section in respect of the conduct have been concluded and the person has not been convicted of the offence.

(5) An enforcement authority may not impose a financial penalty under this section on a person for a breach of paragraph 3 of Schedule 2 in relation to a holding deposit if—

(a) the person failed to return the deposit in accordance with that Schedule because the person believed that the landlord was prohibited by section 22 of the Immigration Act 2014 from granting a tenancy of the housing to the tenant, and

(b) the person's belief was based on incorrect information provided by the Secretary of State.

(6) Only one financial penalty under this section may be imposed in respect of the same breach.

(7) An enforcement authority may impose a financial penalty under this section in respect of a breach which occurs outside that authority's area (as well as in respect of a breach which occurs within that area).

(8) Schedule 3 makes further provision about financial penalties under this section and other payments required to be made under this Act.

Power to amend maximum financial penalties

9

(1) The Secretary of State may by regulations made by statutory instrument amend the amount for the time being set out in section 8(2)(b) or (3)(a) or (b) (financial penalties).

(2) The power in subsection (1) may be exercised only where the Secretary of State considers it is expedient to do so to reflect changes in the value of money.

(3) Regulations under this section may make transitional, transitory or saving provision.

(4) A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.

Recovery by enforcement authority of amount paid

10

(1) Subsection (2) applies where an enforcement authority—

(a) imposes a financial penalty under section 8 on a landlord or letting agent for breaching section 1 or 2,

(b) is satisfied on the balance of probabilities that the breach resulted in a relevant person making a prohibited payment to a landlord, letting agent or third party, and

(c) is satisfied on the balance of probabilities that all or part of the prohibited payment has not been repaid to the relevant person.

(2) The enforcement authority may require the landlord or letting agent to pay to the relevant person—

(a) if none of the prohibited payment has been repaid to the relevant person, the amount of the prohibited payment;

(b) if part of the prohibited payment has been repaid to the relevant person, the remaining part of the prohibited payment.

(3) But subsection (2) does not apply in relation to a prohibited payment if or to the extent that, with the consent of the relevant person—

(a) the prohibited payment, or the remaining part of it, has been applied towards a payment of rent under the tenancy, or

(b) the prohibited payment, or the remaining part of it, has been applied towards the tenancy deposit in respect of the tenancy.

(4) Subsection (5) applies where an enforcement authority—

(a) imposes a financial penalty under section 8 on a landlord or letting agent for breaching section 1 or 2,

(b) is satisfied on the balance of probabilities that the breach resulted in a relevant person entering into a contract with a third party, and

(c) is satisfied on the balance of probabilities that the relevant person has made a payment or payments under the contract.

(5) The enforcement authority may require the landlord or letting agent to pay to the relevant person an amount which does not exceed the amount of the payment or (as the case may be) the aggregate amount of the payments that the relevant person has made.

(6) Subsection (8) applies where an enforcement authority—

(a) imposes a financial penalty under section 8 on a landlord or letting agent for breaching Schedule 2 (treatment of holding deposit), and

(b) is satisfied on the balance of probabilities that all or part of the holding deposit has not been repaid to the relevant person.

(7) Subsection (8) also applies where an enforcement authority—

(a) could have imposed a financial penalty under section 8 on a landlord or letting agent for breaching paragraph 3 of Schedule 2 but for subsection (5) of that section (incorrect belief that immigration-related prohibition on granting tenancy applied), and

(b) is satisfied on the balance of probabilities that all or part of the holding deposit has not been repaid to the relevant person.

(8) The enforcement authority may require the landlord or letting agent to pay to the relevant person—

(a) if none of the holding deposit has been repaid to the relevant person, the amount of the holding deposit;

(b) if part of the holding deposit has been repaid to the relevant person, the remaining part of the holding deposit.

(9) But subsection (8) does not apply in relation to a holding deposit if or to the extent that, with the consent of the relevant person—

(a) the holding deposit, or the remaining part of it, has been applied towards a payment of rent under the tenancy, or

(b) the holding deposit, or the remaining part of it, has been applied towards the tenancy deposit in respect of the tenancy.

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