When business owners, agents, brokers or landlords put a business or property up for sale or rent they must produce an EPC, which provides information on the energy efficiency and likely carbon dioxide (CO2) emissions from business premises or residential buildings. An EPC applies only to those business properties which have ‘their own heating or conditioning units’ and lasts for 10 years. The penalty fee for not having an EPC ready to show prospective buyers or tenants is fixed at 12.5% of the rateable value of the relevant building. Penalties range between £500 and £5,000.
The law governing EPCs is the Energy Performance of Buildings (Certificates and Inspections) (England and Wales) Regulations 2008. These regulations have been changed as follows:
- An EPC (or written evidence that an EPC has been commissioned if you don’t yet have an EPC) should be supplied as part of an advertisement listing to potential buyers as early as possible in the sales process. To that end an EPC, or written evidence that you have applied for one, should be obtained within seven (7) days of marketing.
- Brokers and agents must use “all reasonable efforts” to obtain the EPC – this applies to both residential buildings and commercial premises.
- However, if sellers use all reasonable efforts to apply for an EPC within the 7 day period they have a further twenty one (21) days to obtain the certificate. Therefore all sellers must have an EPC in their possession within 28 days of the start of marketing.
- Brokers/agents acting on behalf of sellers must satisfy themselves that an EPC has been commissioned by their clients before marketing the property or be at risk of being liable for a fine under the Regulations.
- The entire EPC certificate should be attached to a business listing advert if possible, or if this isn’t possible the asset graph (which shows the energy rating of the property) as a minimum must be attached.
- Owners of commercial premises can obtain an EPC before they put their business up for sale – in fact we recommend obtaining one as soon as possible. However, the above legal obligations apply only when an owner decides to market their business premises for sale or lease.