Agricultural tenancies and the Code of Practice: what you need to know

Agricultural tenancies and the Code of Practice: what you need to know

Sophie Fletcher, Agriculture & Rural

The Agricultural Landlord and Tenant Code of Practice (the “Code”) has changed how landlords and tenants are expected to work together in the agricultural sector and it’s something both sides should be aware of.

Before looking at what the Code means in practice, it’s helpful to understand the two main types of agricultural tenancy:

• Agricultural Holdings Act 1986 tenancy/AHA tenancy: typically granted before 1st September 1995. These offer tenants a high level of protection, including security of tenure and, in some cases, the ability for a family member to succeed to the tenancy.
• Farm Business Tenancy/FBTs: introduced under the Agricultural Tenancies Act 1995. These are generally more flexible, allowing landlords and tenants to agree terms between themselves but without the same long-term security or automatic rights of renewal.

The Code of Practice

In April 2024, the Code was introduced following Baroness Rock’s independent review of tenant farming in England.

The Code is voluntary and does not override existing tenancy agreements. However, it sets out a clear framework for how landlords, tenants and their advisers should work together, with a focus on clarity, communication and collaboration.

In practical terms, it is designed to raise standards across the sector and promote more constructive working relationships.

The introduction of the Code has been widely welcomed by organisations including the CLA, the Tenant Farmers Association and the NFU, reflecting a shared desire to improve relationships and standards within the tenanted sector.

In addition, Alan Laidlaw was appointed as the Commissioner for the Tenant Farming Sector in England in September 2025 who will assist in the implementation of the Code. His main role is to assist in strengthening relationships between tenant farmers, landlords and advisers and to promote the standards set out in the Code.

What does the Code mean in practice?

The Code provides guidance across a number of key areas. In particular, it encourages:

• Earlier and more open discussions around rent reviews, helping to avoid last-minute negotiations
• Regular consideration of repairs and improvements, so issues can be addressed promptly
• Clear communication about future intentions, including renewal or termination of tenancies
• A reasonable approach to new opportunities and schemes, with landlords expected not to withhold consent without good reason
• A more collaborative approach to resolving disputes, with an emphasis on communication before escalation

It also highlights the role of professional advisers, encouraging them to make clients aware of the Code and to help minimise the need for formal dispute resolution where possible.

Why does this matter?

Although the Code is not legally binding, it is likely to influence expectations across the industry.

Following the Code can help both landlords and tenants to:

• Maintain strong and productive working relationships
• Reduce the risk of disputes and associated costs
• Demonstrate reasonable behaviour if disagreements do arise

In many cases, the Code will become a benchmark for what is considered good practice in the sector.

Points to consider for new tenancies

If you are entering into a new Farm Business Tenancy, it is worth considering how the Code can be reflected in the agreement.

Many modern precedent FBTs have already been updated to reference the Code, including provisions encouraging both parties to follow it during the term.

Particular care should also be taken to avoid clauses that place blanket restrictions on a tenant’s ability to participate in agri-environment or other emerging schemes.

How we can help

If you would like to discuss how the Code may affect your current arrangements, or are considering entering into a new tenancy, get in touch to find out how our Rural and Agricultural Team can assist.