The present and future for energy efficiency standards in commercial properties

Environmental issues are increasingly becoming a major concern within society and inevitably a key priority forming part of government policy. In the context of commercial property, this is most noticeable with the rules on ascertaining the energy efficiency of properties, by way of an Energy Performance Certificate ("EPC"). More than a quarter of the UK's emissions are caused by business and industry, and a significant proportion of these are created by the energy used to heat commercial properties.

Since April 2018, The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 ("the MEES Regulations") have made it unlawful for a landlord to grant a new lease for a property which has an EPC rating lower than band E (i.e. a rating of either "F" or "G"), subject to certain exceptions.

If the property falls within the scope of the MEES Regulations and is revealed to have an EPC rating of "F" or "G", before the property is let the landlord must first carry out "relevant energy efficiency improvements" so that the property's energy rating is raised to at least "E".

Professional negligence claims in property transactions

Just as an administrator of a SIPP or SSAS has duties to the trust, a solicitor instructed on behalf of the trust has a duty of care.

Forbes have experience acting on behalf of pension funds against their former lawyers for failing to spot a defect in the title, such as a restrictive covenant or a right of way, resulting in practical problems and a reduced rental revenue.

It is common knowledge that a claim of professional negligence must be brought within 6 years, but how this works with property transactions is less than straightforward.

Potential Pitfalls for Pension Investors

The introduction of pension freedoms in 2015 means that investors have a lot more choice over what to do with their pension savings. Whereas in the past the pension had to come to an end on death, now residual funds are allowed to remain in the protected pension environment for the benefit of the investor's beneficiaries.

Pensions offer significant tax benefits. Not only are there tax reliefs on contributions into the scheme, but the overall fund is not treated as part of the investor's estate on death for inheritance tax purposes. This had led to a large number of people considering their pension fund to be a major vehicle for passing wealth onto the next generation.

Whilst the freedoms are a good thing there are a number of potential pitfalls and misconceptions that people need to be aware of.

Long Awaited Pensions Schemes Bill Published

The long-awaited Pension Schemes Bill was published on 16 October, detailing amongst other issues the proposed framework for collective defined contribution, new powers and sanctions for The Pensions Regulator and enabling provisions for Pension Dashboards.

It also amends the 2004 Pensions Act provisions on scheme funding, requiring trustees to establish and maintain a 'funding and investment strategy'. In respect of the long-term funding objective, trustees will be required to have a documented strategy for ensuring that enduring pensions and other benefits under the scheme can be provided. This strategy will need to specify the intended funding level at specified future dates and the investments the trustees intend to hold.

Share Buybacks - Proceed with caution!

An in-specie contribution is a viable alternative to transferring cash into a pension scheme, and can include assets such as property or shares. Dangers can arise where the shares held in the pension scheme are bought back by the company for cash.

Private limited companies can make use of a mechanism under the Companies Act 2006 (the "Act") to buy back their own shares (whether for cancellation or to be held in 'treasury') to provide an exit strategy for a shareholder leaving the business or to return value to one or more shareholders, in this instance the pension scheme.