The Farm Tenancy Forum’s Guidance Note on Long-Term Farm Business Tenancies

The Farm Tenancy Forum has just published its Guidance Note on Long-Term Farm Business Tenancies in England:  Farm Tenancy Forum Guidance

The fact that it has been published is likely to be seen as a key step, and will be taken as an endorsement of a move towards long-term FBTs across the sector.

This is most clearly shown in the foreword:

“Perhaps most importantly, long-term FBTs allow strong relationships to be fostered between landlords and tenants which are mutually beneficial.”

Why the Guidance Note carries particular weight is that it is endorsed by leading organisations in the sector, who between them will deal with the vast majority of FBTs:

Agricultural Law Association
Association of Chief Estates Surveyors
Central Association of Agricultural Valuers
Country Land & Business Association
Institutional Landowners Group
National Farmers Union
National Federation of Young Farmers Clubs
Royal Institution of Chartered Surveyors
Tenant Farmers Association

The recommendation of a Management Plan is a particularly striking element of the Guidance Note.  The Management Plan is intended to be a non-contractual schedule agreed between landlord and tenant for the use and management of the holding:

“The advantage of a Management Plan is that it can capture the desire of the parties to achieve mutual objectives – recognising that the parties wish the tenant to be able to farm commercially and profitably.”

The idea is that this enables landlords and tenants to align themselves from the start and identify together how they want land to be farmed, without confining themselves within a legal straitjacket.  

If all of this sounds vaguely familiar, it is.  The Guidance Note does not expressly say it, but it appears to be a response to the shifting climate around farm business tenancies that has been led by the radical eFBT (the Environmental Farm Business Tenancy) pioneered by The Crown Estate and endorsed by the Tenant Farmers Association.  All of the eFBT documents are available for free download at eFBT - The environmental Farm Business Tenancy

The eFBT delivers all of these outcomes and more, with a focus on the long-term relationship between landlord and tenant, and a deeper dive into how the land will be farmed and how the farm can fulfil its wider role as a hub for rural communities and economies, with the shared aspirations of the landlord and the farmer set out in the Farm Green Book and the Farm Partnership Book that accompany the eFBT itself.

The new Guidance Note is well worth considering and the endorsement it gives to long-term tenancies is likely to be seen as part of significant change in the approach to how farmland is let.  

Read it alongside the eFBT materials for a vision of how radically landlord and tenant relations can develop.

Perhaps most importantly, long-term FBTs allow strong relationships to be fostered between landlords and tenants which are mutually beneficial.