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Guide to farm business tenancies

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Posted by Jennie Wheildon on 07 November 2012

Jennie Wheildon - Agricultural Property Lawyer
Jennie Wheildon Senior Associate

What?

Tenancies created under the Agricultural Tenancies Act 1995 allow land to be let as a Farm Business Tenancy (FBT) if all or part of the land is farmed for a business or trade that is wholly or primarily agricultural. This could include farm shops, food processing, and the provisions of recreational facilities.

Rent reviews under FBTs are dealt with by the Act. 

Why?

The aim of the 1995 Act was to deregulation the market for land to let and to encourage diversification into non-agricultural areas.

How?

The terms of the tenancy should be agreed between the landlord and the tenant and recorded in writing.

Who?

Any landowner can grant a FBT.

Any tenant can take a FBT.

When?

Only tenancies created after 1 September 1995 can be FBTs.

The landlord and tenant can agree any duration, and this can be for a fixed term or periodic (ie yearly, monthly, etc). A fixed term FBT of two years or less will simply come to an end after the fixed term but a fixed term of more than two years will require a notice to terminate giving at least 12 months notice ending on the anniversary of the start date of the FBT. A FBT for a fixed term of more than 2 years which is not terminated by notice will continue to run on a year to year basis until it is terminated on 12 months notice. Break clauses to bring the FBT to an early end may also be used.

Where?

The Agricultural Tenancies Act 1995 applies to England and Wales.

Tags: Agriculture

About the author

Jennie Wheildon

Senior Associate

Jennie advises on commercial property including land acquisition and disposal, landlord and tenant, refinance and charging, residential development and site set up, overage and clawback agreements.

Jennie Wheildon

Jennie advises on commercial property including land acquisition and disposal, landlord and tenant, refinance and charging, residential development and site set up, overage and clawback agreements.

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