EAST Lancashire retailers hit by the coronavirus crisis will be protected by temporary Government measures that will ban landlords from taking aggressive action to extract rent arrears.

The Government announced that it will temporarily ban the use of statutory demands made between March 1 and June 30, and winding up petitions presented from April 27 April, through to June 30, where a company cannot pay its bills due to coronavirus.

The measures will be included in the Corporate Insolvency and Governance Bill, which the Business Secretary Alok Sharma set out earlier this month.

The Government is also laying secondary legislation to provide tenants with more breathing space to pay rent by preventing landlords using Commercial Rent Arrears Recovery (CRAR) unless they are owed 90 days of unpaid rent.

Ministers believe the new laws will protect local high streets and help preserve millions of jobs.

Commenting on the Government's announcement, Eleanor Longworth, associate solicitor at WHN Solicitors which has offices in East Lancashire and Greater Manchester, said: “The upshot of the impending legislation is that commercial landlords will no longer be able to use statutory demands and issue winding up proceedings if the reason the tenant can’t pay is down to coronavirus.

“In addition, there are to be restrictions on a landlord’s ability to use CRAR, which ordinarily allows landlords to instruct agents to seize goods to discharge debts, unless landlords are owed at least 90 days of unpaid rent

“The clear Government objective is to assist tenants and ease the financial burden in the hope that they will survive the crisis and continue to trade when the restrictions are lifted.”

Commenting on the widespread concern about the predicament of commercial landlords who rely on rental income stream to stay in business, Ms Longworth said: “Landlords may be left with a significant gap in cash flow, with insurance premiums and contractors still to be paid. Government initiatives to date have been tenant focused, with little being done to help landlords who may themselves be under significant financial strain.

“Although ministers have urged banks and investors to consider ways to address these issues, many landlords will be at the mercy of their lenders. We hope the banks too will adopt a cooperative approach in order to ease this enormous burden.”