The corona pandemic and commercial leases in The Netherlands 

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Jurjen Tuinman and Tim de Booys wrote the first academic article on the consequences of the corona pandemic for commercial leases in the Netherlands. The article will be published in the April 2020 issue of the leading Dutch journal WR, Journal for Tenancy Law. In the publication, the following questions are addressed:

Is the tenant entitled to suspend rent payment in case of closure due to the corona crisis?

The authority to suspend the payment obligations is excluded in most commercial leases. Such exclusion is permitted. As a rule, tenants are not authorised to suspend rent payments.

Is the tenant entitled to a rent reduction as a compensation for the government measures against the corona pandemic?

A tenant is entitled to claim a proportionate rent reduction if the corona crisis constitutes a defect. In principle, the government measures in relation to the corona pandemic qualify as a defect in the meaning of section 7:204(2) of the Dutch Civil Code. However, it is allowed to exclude this right in commercial leases, and in such leases the right to a rent reduction is generally excluded as a matter of course. Most commercial landlords will be able to rely successfully on the exclusion of the right to a rent reduction.

What other remedies does a tenant have?

First, the tenant may cease operations temporarily. Second, the tenant may claim amendment of the lease due to unforeseen circumstances. Although high bars apply, we consider a successful reliance on unforeseen circumstances to be possible if, for example, relatively smaller tenants have been unable to use the leased property altogether due to mandatory closure. Third, landlord and tenant must take each other’s legitimate interests into account. This may require the parties to enter into negotiations in which the parties might have to make concessions in departure from the initial agreement.

Click here for the full article.

30 april 2020 | Artikel