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Legislation / Regulation / Consultations

To operate lawfully as a UK estate or letting agent or both, agents need to be aware and abide by current UK legislation. This can vary in England, Wales, Scotland and N Ireland.

Below we have links to legislation and regulation content and guidance. Should you think we are missing guidance, or that something is out of date. Please let us know at admin@inea.co.uk .......

There is a minefield of technical legislation to protect consumers and clients and businesses from bad agency and property sales practise. We also have links to CMA (Competition and Markets Authority) cases where agents have breach Competition law.

Chartered Trading Standards Institute and BIS (Business, Innovation & Skills) have created a business companion website for lighter insight and overview:  


 Regulations and Guidance for Sales Agents  

TRADING STANDARDS (NTSEAT) GUIDANCE ON PROPERTY SALES - link
**  (Sept 1st 2015) replaces the OFT's Guidance on CPR's

  • Advice for Estate Agents (in brief Sept 2015) - link
  • Consumer Rights Act 2015 (duty of agents to publish fees) - link
    .... an update (by CMA) has been created because of changes to the law in the Consumer Rights Act 2015 (the Act), which will come into force in October - link

  • NTSEAT Guidance on defining Estate Agency Work and responsibilities - link
  • NTSEAT revised version of the Estate Agents Act (1979) taking in ammendments to October 2016 - link
  • The Unfair Terms in Consumer Contracts Regulations 1999 - link 
  • Data Protection Act - 1998 - link
    * ICO (Information Commissioners Office) Easier to understand Data Protection Guidance - link

  • BPR's Business Protection from Misleading Marketing Regulations (2008) - link
  • Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 - link
  • Equality Act - link
  • Energy Act 2011 (Green Deal) - link
  • Energy Performance of Buildings (England & Wales regulations 2012) - link
    *Further EPC Gov documents - link 
  • CMA: Unfair Contract Terms Guidance - link
  • UK Advertising codes - examples of estate agency advertising rulings - link
  • ASA (Advetising Standards Authority) where agents fees must include VAT clear for clients to understand - link
  • Consumer Protection (Distance Selling) Regulations 2013 - link

  • Anti Money Laundering Regulations (All) HMRC - link
    Money Laundering Regulations 2007: supervision of Estate Agency - link
    ** 41 page PDF guidance for agents: link
    AML Registering guide for Estate Agency Businesses - link
    useful Q&A on AML for agents - link

  • Consumer protection guidance on the CMA'S (COMPETITION AND MARKETS AUTHORITY) approach to use its consumer powers - link
  • Town & Country Planning Regulations 1992 (Control of Advertisements/ FS boards) - link
    The Town and Country Planning (Control of Advertisements) (England) Regulations 2007 - link

  • Case law on Non-Returnable Deposit: Sharma & Kuruppu v Simposh – Court of Appeal – [2011] EWCA Civ 1383 – leading case on return of non–refundable property deposits (conditions must be precise on how a NRD will OR won't be returned) - link

*** NTSEAT also offer this 'Tool Kit' guidance to Trading Standards Officers on what agents should have in place, be doing, and how TSO's should handle non compliant agents: link here


 Regulations and Guidance for Lettings Agents  

  • Consumer Protection law for lettings professionals - link
  • Consumer Rights Act 2015 (duty of agents to publish fees) - link
  • Guidance for lettings professionals on consumer protection law (13 june 2014/CMA31) - link
  • Data Protection Act - 1998 - link

  • Deregulation Act 2015 (October 1st, relates to new Section 21 requirements) - link
    (all s.21 notices will have 6 month lifespan, AST landlords will have to wait 4 months after tenancy begins to serve, landlords can no longer retalitory evict once the tenant raises a complaint to the relevant local authority who then raise a 'stay' notice to the landlord about the property, or part of, ie a common part. The eviction process remains the same, but at the start of a tenancy agents and landlords need to give tenants a 'current' Government book called: How to Rent, gaining a tenant signature to confirm they have received a hard copy).

  • The Unfair Terms in Consumer Contracts Regulations 1999 - link
  • The Consumer Protection from Unfair Trading Regulations 2008 - link
  • BPR's Business Protection from Misleading Marketing Regulations (2008) - link
  • Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 - link
  • Energy Act 2011 (Green Deal) - link
  • Landlord and Tenants Act 1985 - link
  • Landlord and Tenants (Covenants) Act 1995 - link
  • Housing Act 2004 - link

  • Rent Repayment Order (RRO) From April 2017 - link 
    RRO's give local authorities in England tough new powers to crack down on rogue agents and landlords. Tenants will now be able to submit a claim without the local authority having prosecuted the agent or landlord, and the local authorities have the power to assist them. Local housing authorities will be able to impose a civil penalty of up to £30,000 for a range of housing offences, including: 

    • Failure to comply with a housing improvement or overcrowding notice;
    • Failure to have the correct licence for a property that needs a mandatory HMO, additional or selective licence; and
    • Failure to comply with the HMO management regulations.
      • Illegal eviction or harassment of occupiers;
      • Using violence to secure entry; and
      • Failure to comply with a housing improvement notice or prohibition order.

    When it comes to properties that do not have the correct licence or where management rules for Houses in Multiple Occupation (HMOs) are breached, both the landlord and letting agent can be held liable under RRO's.



  • The Immigration Act (Oct 2016) - link
    * from Dec 2016 it is now easier for private landlords to evict illegal migrant tanants. * It is now also a crime to knowingly or with reasonable cause to let to illegal migrants.
       **(Im Act) Residential Tenancies fact-sheet
       **(Im Act) Guidance on migrant evictions

  • The Smoke and Carbon Monoxide Alarm (England) Regulations 2015 - link
  • Equality Act - link
  • Unfair Contract Terms Guidance - link

  • The Consumer Rights Act 2015 (makes it a legal requirement for letting agents in England to publicise details of their fees, whether or not they are a member of a Client Money Protection scheme and which redress scheme they have joined) - link   
    . .... associates with:  Improving the Private Rented Sector and Tackling Bad Practice 2015  - link
    • Right to Rent - All landlords in England will have to make checks from 1 February 2016 - link

    • The Energy Act 2011 - (Come April 2018) - requires let properties below minimal standards to be upgraded, or they will become illegal lets - link    

    • UK Advertising codes - examples of agency advertising rulings - link
      ASA / Trading Standards article:  In October 2015 agents who do not show letting fees and charges will be open to fines up to £5,000. This only applies to adverts in print and Letting Agents' own websites. It doesn't apply to adverts listed on property portal sites (such as INEA.co.uk, Rightmove, Zoopla):  link here


    • Town & Country Planning Regulations 1992 (Control of Advertisements/ FS boards) - link
      The Town and Country Planning (Control of Advertisements) (England) Regulations 2007 - link

    • Consumer Protection (Distance Selling) Regulations 2013 - link

    • Custodial Deposit Schemes -here

               Guidance for Letting agents on displaying fees:  here


 Consultations about the property Industry    


Banning letting agent fees paid by tenants
- The consultation began April 2017 and closes 2nd June 2017. The duties of letting agents might include finding tenants, collecting rent, and responding to queries from tenants (for example, in relation to repairs). Landlords pay fees to letting agents for carrying out these duties on their behalf. Letting agents also charge fees to tenants for a variety of reasons, including seeking references, inventory services and contract negotiations.  The ban will recognise the stronger market position of landlords. The ban will sharpen and increase letting agents’ incentives to compete for landlords’ business, resulting in a better and more transparent service. Tenants will be able – at a glance – to see what a given property will cost them in the advertised rent level without any additional hidden costs; this should help to make entering and moving around in the private rented sector easier and less costly.  link   


Fixing our Broken Housing Market
 - The consultation will begin on 7 February 2017. The consultation will run for 12 weeks and will close on 2 May 2017. All responses should be received by no later than 23:45 on 2 May 2017 - link 


Renters Rights Bill -
18th November 2016 - Volume 776 - link
Ending certain letting fees for tenants (to happen in 2018) making the charging of tenants an offence. In particular: registration fees, administration fees, an inventory check and reference, extension, renewal and exit fees. This refers to anything other than the deposit and rent. The Bill does allow that some fees may be reconsidered in the future should evidence show government reason for reviews to happen in the interest of tenants.


HM Treasury - Consultation on the transposition of the Fourth Money Laundering Directive: 
The closing date for next stage comments to be submitted is 11:45pm on April 12th 2017 

The Government has released a new consultation on the Fourth Money Laundering Directive. The UK is obliged to ensure adherence to EU directives until exit negotiations are concluded. The proposals are of specific interest to estate agents and letting agents (in particular page 31 of the document). Proposals include making the membership bodies supervise their members for anti-money laundering purposes, with HMRC continuing to supervise agents that do not belong to a recognized body. For the first time, letting agents would also have anti-money laundering responsibilities. The consultation is seeking views on whether letting agents should carry out checks on both landlords and tenants, and if so at what stage. The consultation also addresses the very thorny issue of sub-agents, saying that where there is a sub-agent acting on behalf of a principal estate agent, a sub-agent cannot rely on the due diligence performed by the main agent. However, the consultation introduces the thought that subject to certain provisos, the sub-agent might be able to rely on it. - Consultation link here -    INEA agents AML Survey here  (Closed Tuesday 8th November 5pm)


CLIENT MONEY PROTECTION REVIEW - 
Last updated 27th March 2017 - Link
Report by the working group, chaired by Baroness Hayter and Lord Palmer of Childs Hill, to decide on whether it would be appropriate to recommend mandating that Client Money Protection (CMP) be taken out by letting agents.  The recommendation of the working group is to move forward with the mandating of CMP for agents in England that handle client money.   Client Money Protection (CMP) schemes protect the money of landlords and tenants in the event of a letting or property agent going into administration and against theft or misappropriation by the agent whilst it is in their custody or control.     These monies are frequently tenants’ deposits and landlords’ rental payments but can also include monies held for repairs and maintenance to the property.     The government have established a working group with colleagues from the House of Lords to look at how CMP is currently operating and whether to go further by making use of the powers taken through the Housing and Planning Act 2016 to make it mandatory.     This letter invites you to submit your views and evidence on whether and how this should be done.


NTSEAT - National Trading Standards Estate Agency Team:  'Cutting Red Tape'
Closed May 13th 2016 - A chance for the property indstry to make representations as to how things can be made simpler, more cost-effective, efficient, proportionate, or consistent in the estate agency industry. Focused on bringing together sales and lettings, and the introduction of qualification/competency requirements that the industry would get behind - link 

CMA - Competition and Markets Authority 
April 21st 2016 - CMA open letter to estate agents on choosing online property portals. The letter mentions agents meeting as to colluding as to dropping some portals in order to join OnTheMarket - link

HM Treasury: A better deal: 
Nov 2015 - look at early 2016
boosting competition to bring down bills for families and firms link

CONSULTATION BY DEPARTMENT FOR COMMUNITIES AND LOCAL GOVERNMENT/ AUG 2015
Tackling rogue landlords and improving the private rental sector: link  

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National UK Property Transaction Statistics / HMRC  Link here:   released Dec 22nd 2015
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CMA Guidance on:  CMA55 - May 2016  - link
Competition law redress A guide to taking action for breaches of competition law
Makes reference to: Anti-competitive agreements – Article 101 and Chapter I prohibition
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As to a new fee structure for agents from 1 April 2015.
https://www.gov.uk/government/publications/anti-money-laundering-supervision-hm-revenue-and-customs-fees-review

 

Agent Fees Review Summary of responses to the informal consultation January 2015 - INEA gave views: link

 


 Cartels and wrong doing: 

CMA Case of agents in Burnham-on-Sea colluding to fix local sole agency commission at 1.5% forming anti-competitive arrangement/arrangements in the residential estate agency sector that infringe Chapter I of CA98 
link

CMA Case study of an estate agency and newspaper cartel 
fined £775,000 reduced to £735,000 - 
link
Trinity Newspaper & Three Counties Agencies

GSPC
(Glasgow Solicitors Property Centre) refused a membership application from a Glasgow based solicitor firm, putting that firm at a competitive disadvantage - link

Four Somerset agents fined £375,000 as they colluded to set minimum commission rates for residential property sales at 1.5%, with a view to denying local home-owners selling their property the chance of securing a better deal - link


  • CMA Letter to the property industry on competition law (May 2015) - link

  • CMA - Competition and Markets Authority annual plan 2016 to 2017
    Dec 2015 -  closed Jan 21st 2016  - INEA responded
    Includes thoughts on consumer wants in the market, cartels, unfair practices, restricting other traders - link

 Other information:

   Why not search the GOV.UK site for other legislation and useful information on property
- link

        Topics from:

  • Land Registry
  • Council Tax
  • Property Boundaries
  • Gaining Possesson of a privately rented property
  • Buying in other countries
    etc.

 Content for Consumers:  

  • Treasury STAMP DUTY: March 16th 2016 from the 1st April 2016 Budget:
    link here    
    Stamp Duty Land Tax: higher rates for purchases of additional residential properties

  • Guide on first time renting: link here 
  • Lease Extension Calculator: link here

  •   Citizens Advice / Letting agent complaint tool   - link to tool here
    Is your letting agent legal? Let's help them to stick to the rules - and save other renters from nasty surprises.

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