March 24, 2020

Information for landlords and tenants (commercial rent)

 

Tenants and landlords of commercial premises are currently facing particular challenges. Tenants who have difficulties because of the corona crisis should receive protection in Germany during this period.

  • Even in the crisis, the lease parties are basically bound by their contractually agreed obligations. The landlord is obliged to allow the leased property to be used and the tenant to pay the contractually agreed rent. 
  • The prohibition of business operations due to administrative orders does not constitute a right to reduce the rent. The tenant bears the so-called use risk, in particular the risk of making profits from the leased property.
  • In this context, the tenant is not entitled to terminate the rental agreement beyond the agreed or statutory periods. An  adjustment claim of the contract according to the principles of loss of the commercial basis or contract adjustment will be excluded. 
  • The German government has reacted and initiated a change in the law as part of the adopted Corona aid package. From April 2020, tenants can now reduce or even completely suspend their payments until June 2020 without this triggering the right of termination to which the landlord is entitled generally. 
  • The tenant must substantiate that the payment difficulties are due to the Corona Pandemic. 
  • Important for landlords and tenants: The suspended payments must be made up to June 2022.
  • The Lower House of the German Parliament (Bundestag) must still approve the bill in its session scheduled for 25 March, 2020. After that, the law should pass the Upper House of the German Parliament (Bundesrat) on 27 March, 2020.
  • In order to avoid disadvantages, we urgently advise not to stop or reduce the rent without contacting the landlord. Whether the prerequisites for the postponement planned by the legislator are met must be examined in each individual case. 
     

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