Until 30 June 2020, the termination of a commercial lease by the landlord was not possible if the tenant did not pay his rent for the months of April, May and June 2020 due to the economic effects of the coronavirus pandemic. This was ensured by a law hastily passed during the corona crisis, which expired on 1 July 2020.  Which regulations apply now and what should landlords and tenants pay attention to?

Corona-related rental debts for the period April 2020 to June 2020 must be paid by 30 June 2022 at the latest, otherwise there is a risk of termination. According to the current legal situation, the rental debts also bear interest.

If the tenant does not resume payment of the rent from 1 July 2020, he shall be at risk of facing measures under civil law which may even lead to termination of the lease.

The right to terminate lease agreements due to payment arrears has been limited to cases where the tenant is in arrears with lease payments that were due in the period from 1 April 2020 to 30 June 2020. 

The expiry of the special protection against termination on 30 June 2020 means that the landlord can give notice of termination to the tenant if the tenant is in arrears with more than one month’s rent from July 2020 – and also in combination with earlier payment arrears from the period before April 2020.

The landlord and tenant can mutually agree to a deferral of the rent or the landlord may waive all or part of his lease claim by way of a contract. However, the contract should clearly specify the duration of the rent reduction or deferral, the date on which the deferral of the rental debt ends and whether an interest payment is due.

These provisions are necessary to exclude the possibility of the landlord terminating the lease due to the payment arrears and, if necessary, to prevent an insolvency situation arising due to the existing rental debts. For the purpose of proof, the agreements should be made in writing. 

At as: 20 July 2020

Author: Dr. Lars C. Hamm, Attorney, Specialist Lawyer for tax law, Specialist Lawyer for criminal law, Auren

Image: Adobe Stock, Gajus

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