Simon Harris (Wicklow, Fine Gael)
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752. To ask the Minister for Justice and Equality the current position regarding upward only rent reviews; the measures that are planned to address the difficulty of many small businesses in relation to this issue; and if he will make a statement on the matter. [28013/13]

Alan Shatter (Dublin South, Fine Gael)
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As I have indicated in my replies to previous Parliamentary Questions on the subject of upward only rent review clauses, there are no plans to re-examine the decision which was taken in 2011 not to proceed with legislation to abolish such clauses in commercial leases which were entered into prior to 28 February 2010. It will be recalled that the background to this decision was a substantial concern that any legislative scheme involving interference in the contractual relationships of private parties would find it extremely difficult to survive a Constitutional challenge. In addition, the Government was advised that any model proposed would require the payment of compensation to landlords whose rights were infringed in order to ensure that the proposal would be compatible with the Constitution and with the European Convention on Human Rights.

With regard to providing assistance to businesses in relation to this matter, absent legislative intervention, NAMA is playing a role in dealing with problems caused by upward only rent reviews applying to NAMA properties. I have been advised that, by end-April 2013, the Agency had granted 222 applications for rent abatement with an aggregate annual value of about €14 million which represents the annual value of rent due to NAMA that it has agreed to forego in order to help businesses survive. A further 52 applications were under review at that date. Of the 284 eligible applications received only 10 have been refused representing a 96% approval rate by NAMA. The practice of NAMA in this area is one which I would commend to landlords in the commercial property market and in the retail sector in particular.

More generally, the importance of supporting the retail sector is widely recognised across a range of Government Departments. Continuing action is being taken to reduce the cost of doing business for all businesses, and is intended to have a positive impact on areas such as energy, local authority rates, and the administrative burden involved in companies complying with Government regulations and tax systems. I would also draw the attention of the Deputy to the Action Plan for Jobs which lies within the remit of the Minister for Jobs, Enterprise and Innovation.

The Property Services (Regulation) Act 2011 provides for the establishment and maintenance of a Commercial Leases Database by the Property Services Regulatory Authority. This Database will assist in providing readily accessible, accurate information in order to determine the market rent payable in respect of comparable commercial properties. Work is underway to ensure that the Database will be operational shortly. Attention is drawn to the existence of a rent review arbitration code which was drawn up by a group of experts whose membership was drawn from all stakeholders in the commercial property arena. The code, which can be found on www.justice.ie, provides a mechanism, applied on a voluntary basis, to deal with the resolution of rent review disputes in the commercial property sector. The effectiveness of the Code and the extent to which it is utilised by stakeholders is currently under review.