Section 7 amends section 14 of the Housing Act 1988. The amended section sets out the circumstances in which a tenant can submit an application to the Tribunal, to either challenge the rent amount in the first six months of a tenancy (with similar effect to the existing mechanisms provided for by section 22 of the Housing Act 1988) or following service of a section 13 rent increase notice.
	Unlike the previous provisions for challenging a rent increase or the rent amount in the first six months of the tenancy, the amended section does not require the Secretary of State to prescribe by regulations the form which must be used to make an application to the Tribunal.
	New subsection (A2) of section 14 provides that no application may be made to the Tribunal under new subsection (A1) to challenge the initial rent payable under the tenancy if the Tribunal has already made a decision on this, or if more than six months have passed since the beginning of the tenancy. New subsection (A3) nevertheless provides that all tenants under assured tenancies are able to challenge a rent increase undertaken via the section 13 process. Tenants of relevant low-cost tenancies are unable to challenge the rent amount in the first six months of a tenancy.
	Subsection (7) omits subsection 14(6) of the Housing Act 1988 which refers to section 6 Housing Act 1988 process of varying terms of a tenancy and is being repealed by the Act. It also omits subsection 14(7) of the Housing Act 1988. The omission results in the removal of the Tribunal’s ability to determine a new rent which is higher than that proposed by the landlord in the section 13 notice and to backdate this to the date specified in that notice. This is replaced by new section 14ZB (Effect of determination: proposed new rent) as set out below.
	Subsection (10) inserts sections 14ZA (Effect of determination: rent payable) and 14ZB (Effect of determination: proposed new rent) into the Housing Act 1988. These sections outline the processes the Tribunal is to follow where a tenant has challenged the rent in the first 6 months of the tenancy (new section 14ZA) and where the tenant is challenging a rent increase as set out in section 13 of the 1988 Housing Act (new section 14ZB).
	Section 14ZA applies when the Tribunal makes a determination of the open-market rent following a challenge by the tenant to the rent amount in the first six months of the tenancy. The section provides that the new rent amount will be the lower of the determined open-market rent and the rent payable under the tenancy immediately before the Tribunal’s determination of the open-market rent. The rent payable will be the new rent plus any appropriate amount for rates and takes effect from the date the Tribunal directs. This must not, however, be earlier than the date of application to the Tribunal. Nothing in this section stops the landlord and tenant agreeing to a lower amount than the Tribunal determines but this should be agreed by the tenant and landlord in writing.
	Section 14ZB applies when the Tribunal makes a determination of the open-market rent when the tenant is challenging a section 13 rent increase under section 14(A3). The section provides that the new rent amount will be the lower of the determined open-market rent and the proposed rent in the section 13 notice. The rent payable will be the new rent plus any appropriate amount for rates and generally takes effect from the start of the next rent period following the Tribunal’s determination (though the Tribunal may delay the rent increase taking effect for up to two months from the date of its determination in cases of undue hardship).
	Subsection (6) of new section 14ZB enables the Secretary of State to make regulations amending subsection 14ZB(3)(b) of the Housing Act 1988 to enable the Tribunal to backdate rent increases following determination of the open-market rent, to a date no earlier than the date specified in the section 13 notice. Section 14ZB(8) provides that regulations made under section 14ZB(6) can be used to amend section 14ZB of the Housing Act 1988, make different provision for different purposes, make supplemental, consequential, incidental, transitional, transitory or saving provision, and are to be made by statutory instrument. Section 14ZB(9) provides that any regulations made using this power must be subject to the affirmative procedure.
	Where the landlord has served a section 13 notice, the landlord and tenant can agree to a variation in rent before the Tribunal has made a determination. This can be higher than the current rent but must be the same or below the rent specified in the section 13 notice. As set out in section 13(4A)(c) the landlord and tenant can agree a lower rent than the new rent amount resulting from the Tribunal’s determination (which may be higher than the original rent or proposed rent increase) and this must be agreed in writing.
Part 1: Tenancy reform Chapter 1: Assured Tenancies Section 7: Challenging amount or increase of rent Effect