The landlord's hypothec is a right in security over certain goods within a property leased by the landlord when there are rent arrears. Sequestration for rent enforces the hypothec. It should not be mistaken for sequestration meaning bankruptcy but instead allows the attachment, and potentially the sale, of the goods subject to the hypothec.

Sequestration for rent is considered a disproportionate diligence that has European Court of Human Rights issues. The Act makes provision to abolish sequestration for rent and consequently entails various reforms to the hypothec.