Leases (Automatic Continuation etc.) (Scotland) Bill

A lease is a contract where one person (the landlord) gives another person (the tenant) the right to use property for a fixed period in exchange for payment (rent). The Bill changes the way that certain types of commercial leases can be ended at the end of that fixed period.

This is a Government bill

The Bill was introduced on 11 December 2024 and is at Stage 1

Stage: Introduced Stage: Stage 1 Stage: Stage 2 Stage: Stage 3 Stage: Act

This Bill is at Stage 1 of the process to decide if it should become an Act.

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Overview

Under this Bill, certain types of commercial lease would continue automatically after the date they would otherwise have ended (the “termination date”). To end the lease on its termination date, the landlord and tenant must both agree that it will end then, or either the landlord or tenant must give notice. The Bill sets out rules about what the notice must contain, when it must be given, how it can be given, and situations when notice can be withdrawn. The proposed legislation will replace the current law for automatic continuation of leases, which is known as “tacit relocation”.

The Bill also sets out rules for how leases end, including:

how to determine the date of entry and duration of a lease when it is not clear
that all parties to a lease must provide an address in the UK where certain documents can be sent to them
updates the rules around a landlord ending a lease early using a process called “irritancy”, (normally as a result of the tenant breaching the terms of the lease) when there is a standard security (a mortgage) over the lease
allowing for repayment of rent or other payments after the end of a lease when those payments were made in advance and cover a period after the end of the lease.

Why the Bill was created

The Bill aims to modernise and clarify the law around how certain leases can continue automatically past their termination date, and other procedural elements related to ending leases.

The Bill enacts recommendations made by the Scottish Law Commission in its Report on Aspects of Leases: Termination.

All Bills introduced in the Parliament must be accompanied by specific documents. For most Bills, this includes:

Explanatory Notes: this document provides an overview of what the Bill does, plus a more detailed explanation of individual provisions.

Policy Memorandum: this sets out the objectives of the Bill. It also lists any alternatives considered, details of consultations, and an assessment of the effects of the Bill on a range of areas.

Financial Memorandum: this sets out estimates of costs, savings, and any changes to revenues expected to result from the Bill.

Delegated Powers Memorandum: this is needed if a Bill gives powers to make subordinate legislation or allows Scottish Ministers to issue directions, guidance or codes of practice.

Statements on legislative competence: two short statements, one by the Presiding Officer and one by the Member introducing the Bill. “Legislative competence” means the powers the Parliament has to make law.

Research on the Bill

The Scottish Parliament's Information Centre (SPICe) prepares impartial research and analysis to assist MSPs in their examination of Bills and other parliamentary business.

A research briefing will be published in due course.

The Bill was introduced on 11 December 2024

At Stage 1, the Bill is given to a lead committee. This is usually the committee whose remit most closely relates to the subject of the Bill. The lead committee will consider and report on the Bill. Other committees may also examine the Bill and report to the lead committee. Finally, there is a debate and vote by all MSPs on the general principles of the Bill. If the general principles are not agreed to, then the Bill ‘falls’ and can’t become law.

Lead committee examines the Bill

The lead committee for this Bill is the Delegated Powers and Law Reform Committee.

The lead committee will usually examine the Bill through evidence sessions. This will involve contributions from individuals and organisations, known as 'witnesses', with knowledge of the subject matter. The committee might also discuss the Bill in private sessions.

Stage 1 report by the lead committee

The lead committee will publish a stage 1 report before the debate on the general principles of the Bill.

Leases (Automatic Continuation etc.) (Scotland) Bill

Introduced: the Bill and its documents

Overview

Why the Bill was created

Bill as Introduced

Accompanying Documents

Accompanying Documents (print versions)

Research on the Bill

Stage 1: general principles

Lead committee examines the Bill

Stage 1 report by the lead committee