Commentary on Sections Part 2 – Prohibitions of Certain Payments Section 2 – Prohibitions applying to landlords
4.This section makes it an offence for a landlord to impose certain types of requirement in consideration of granting a standard occupation contract, or renewing or continuing an existing contract, or pursuant to a term of a standard occupation contract.
5.The expressions “standard occupation contract” and “contract-holder” reflect changes to the law on renting homes in Wales introduced by the Renting Homes (Wales) Act 2016 (the “2016 Act”). Generally speaking, tenancies or licences of homes in Wales will, by virtue of the 2016 Act, be rented under occupation contracts, and tenants or licence holders will, for the purposes of the 2016 Act be contract-holders. The drafting of this Act reflects the changes to the law made by the 2016 Act (but at Royal Assent of this Act, the main provisions of the 2016 Act were not in force.)
6.The section provides that it is an offence for a landlord to require a person (whether the contract-holder or a third party) to make a prohibited payment to the landlord or any other person in these circumstances. (A prohibited payment for this purpose is, essentially, any payment that is not within section 4.)
7.It also provides that it is an offence for a landlord to require a person (whether the contract-holder or a third party) to make a loan to the landlord or any other person in these circumstances.
8.It also provides that it is an offence for a landlord to require a person (whether the contract-holder or a third party) to enter into a contract for services with the landlord or any other person in these circumstances. The exception to this is if the services referred to in the contract are provided by any person upon whom the standard occupation contract in question confers, or would confer, the right to occupy a dwelling. This could include, for example, a live in caretaker of the dwelling, or a person providing childcare, such as a resident nanny.
9.A person who commits an offence under this section is liable on summary conviction to a fine, which is not subject to a maximum level on the standard scale. If the offence relates to requiring a prohibited payment to be made, a court may, on conviction, also order the offender to pay the amount of the prohibited payment (or any outstanding amount if part of the payment has been repaid) to the person who made the payment.