32 The Tenancy Deposit Schemes Regulations–Scotland
The Tenancy Deposit Schemes (Scotland) Regulations 2011 set out the conditions which tenancy deposit schemes must meet and establishes the regulatory framework for such schemes. A landlord who has received a tenancy deposit in connection with a relevant tenancy must, within 30 working days of the beginning of the tenancy (Reg. 3(1))–
(i) pay the deposit to the scheme administrator of an approved scheme;
(ii) provide the tenant with certain specified information.
The information that must be provided is (Reg. 42)–
(iii) confirmation of the amount of the tenancy deposit paid by the tenant and the date on which it was received by the landlord;
(iv) the date on which the tenancy deposit was paid to the scheme administrator;
(v) the address of the property to which the tenancy deposit relates;
(vi) a statement that the landlord is, or has applied to be, entered on the register maintained by the local authority under s.82 of the Antisocial Behaviour etc. (Scotland) Act 2004 (see Housing:Regulation of Landlords);
(vii) the name and contact details of the scheme administrator of the tenancy deposit scheme to which the tenancy deposit was paid; and
(viii) the circumstances in which all or part of the tenancy deposit may be retained at the end of the tenancy, with reference to the terms of the tenancy agreement.
The landlord must ensure that any tenancy deposit paid is held by the scheme from the date it is first paid until it is repaid in accordance with the Regulations following the end of the tenancy (Reg. 3(2)). A tenant who has paid a tenancy deposit may apply to the sheriff for an order where the landlord has not complied with any duty under Reg. 3 in respect of that deposit. An application must be made by summary application and must be made no later than three months after the tenancy has ended (Reg. 9). If satisfied that the landlord did not comply with the duty the sheriff must order the landlord to pay the tenant an amount not exceeding three times the amount of the tenancy deposit. The sheriff may, as he considers appropriate in the circumstances of the application, order the landlord to pay the tenancy deposit to an approved scheme or provide the tenant with the information required under Reg. 42 (Reg. 10).
The Regulations also set out the conditions which a scheme must meet before it can be approved. Inter alia, the person who acts as scheme administrator must be a fit and proper person to do so (Reg. 7). A scheme must be based on the following model (Reg. 11)–
(ix) no fee is payable by the landlord to the scheme administrator in respect of participation in, or otherwise in connection with, the scheme;
(x) the tenancy deposit is paid by the landlord to the scheme administrator;
(xi) the scheme administrator pays the tenancy deposit into an account maintained for the purpose of holding tenancy deposits;
(xii) the tenancy deposit is held in that account until it falls to be repaid in accordance with the Regulations.
A tenancy deposit scheme must be available to all landlords and their tenants and an appropriate customer service facility must be made available for handling enquiries in relation to the scheme and for dealing with complaints (Reg. 13). A scheme must operate on the basis of a business plan which ensures it is self-financing and supports the sustainability of the scheme (Reg. 14). Scheme procedures must protect deposits in the event of scheme failure (Reg. 15). The Regulations also sets out accounting requirements and make provision concerning designated accounts (Regs. 16 to 19).
A landlord must apply to the scheme administrator for repayment of any tenancy deposit paid to an approved scheme on, or as soon as is reasonably practicable after, the end of the tenancy. The tenant may apply for repayment of the deposit, but if an application for repayment has been made by the landlord, or is made within 30 working days of the tenant’s application, the scheme administrator must not progress the application (Reg. 24).
A dispute resolution mechanism must be made available free of charge for the landlord and tenant. It must not be compulsory, but the tenancy deposit scheme must require a landlord who has submitted a deposit to it to use the dispute resolution mechanism in any case where the tenant requests a referral (Regs. 33 to 39).
The scheme administrator has a duty to publicise approved schemes and to produce information leaflets before such schemes become operational (Regs. 40, 41).