The ban on upwards-only rent reviews (“UORRs”) was passed into law via the English Devolution and Community Empowerment Act 2026 (the “Act”) which received Royal Assent on 29th April 2026. The ban marks one of the most significant changes to commercial leasing in England and Wales in decades.
UORRs in context
For decades, UORRs have been a standard feature of UK commercial leases. Under rent review provisions in a commercial lease, rent is typically reviewed periodically (often every five years) where the only possible outcomes are that the rent increases or stays the same, even if market rents have fallen since the lease was granted.
What reviews are captured by the ban on UORRs?
Once the ban comes into effect, it will catch all new and renewal commercial leases entered into in England and Wales where the tenant is occupying, or could occupy, property for business purposes. The ban will apply to leases regardless of whether or not they are contracted out of the Landlord and Tenant Act 1954. The Act will not have retrospective effect and so any commercial leases entered into pre-commencement with upwards only rent review mechanisms will still be enforceable (with two exceptions explained below).
The ban is expected to catch a range of common rent review mechanisms, including:
- open market rent reviews;
- index-linked rent reviews; and
- turnover-based rent reviews.
Importantly, the Act will also target anti-avoidance measures aimed at circumventing the UORR ban. These measures are designed to prevent parties from achieving the effect of UORRs through alternative drafting, such as by including rent review provisions in collateral documents outside the lease. Additionally, landlords will be unable to prevent tenants from triggering a rent review: any clause in a lease reserving the right exclusively to the landlord to initiate a review will be of no effect as the Act will grant tenants the right to trigger a rent review by written notice.
Are there any ways for landlords to reduce the likelihood of a rent being reviewed downwards?
The Act does not explicitly address rent review mechanisms which use ‘higher of’ clauses, such as where the reviewed rent will be the higher of the open market rent or the indexed rent. Where the ‘higher of’ mechanism utilises multiple variables, such as open market rent and RPI, the Government has indicated it will release guidance which confirms that multiple variables will be permitted under the Act and that the rent can be reviewed on this basis so long as there is no floor in the rent review mechanism.
Currently, it is not clear whether the ban will catch “cap and collar” mechanisms, which prevent rents from falling below a minimum sum but also include a cap. Considering a cap and collar provides benefit to both the landlord and the tenant and therefore does not have the same inherent one-sided impact as a straightforward upwards only review there is a compelling case that these should be permitted. The Government is planning to hold a consultation on the use of rent collars and caps prior to the ban coming into force and further updates are awaited on this.
When does the ban on UORRs come into effect?
While the Act has become law, the relevant provisions are not yet operational and are not expected to come into force until 2027 at the earliest. Therefore, any leases entered into before the ban comes into force, or as a result of an agreement for lease entered into prior to it, will not be caught. Additionally, reversionary leases granted before the provisions come into force will not be caught even where the term commencement date is after the ban comes into force.
However there are a couple of notable exceptions where the legislation already bites:
- A lease granted pursuant to an option (“Post-March 2026 Option“) to renew contained in a lease that was entered into on or after 17 March 2026 will be caught (unless the term commencement date in the renewal lease is prior to commencement of the ban – but see point 2 below). The government introduced this to prevent landlords using options to renew with a day one rent review to avoid the impact of the legislation. The ban here will apply to the day one rent review as well as any rent reviews under that renewal lease.
- Perhaps unintentionally, a day one rent review contained in a renewal lease granted before commencement pursuant to a Post-March 2026 Option will be caught by the ban and have no effect.
Underlettings
Tenants should pay particular attention to the consequences of underletting where their lease contains an enforceable UORR. In any underletting after commencement of the ban, the upwards only element of the rent review provision in that underlease will not be enforceable whereas the upwards only element in the tenant’s own lease will still apply (with any requirement that the tenant’s underlease mirrors the terms of its own lease being disapplied in respect of the upwards only element of the rent review).
This could result in a tenant being stuck with a rent shortfall vis a vis its undertenant arising from an upwards only review increasing the rent due under its lease, and an upwards and downwards review producing a lower rent due to it under the underlease.
Conclusion
The main aspects of the ban on UORRs are not expected to come into force for some time, and further guidance from the Government is awaited, as is the consultation on caps and collars. However, both landlords and tenants can start planning now ahead of implementation.
