About Us
FAQ
Global Law Experts Logo
Global Law Experts Logo
GLE-PP

Find a Global Law Expert

Specialism
Country
Practice Area

Awards

Since 2010, the Global Law Experts annual awards have been celebrating excellence, innovation and performance across the legal communities from around the world.

Impact of the Covid-19 Pandemic on Commercial Leases in Germany

posted 3 years ago

Secretly, quietly, on Dec. 22, 2020, German lawmakers passed a law that will have a revolutionary impact on existing commercial leases in times of the corona pandemic. This opens up significant negotiating potential for commercial tenants in terms of rent amounts and forces landlords to take precautions to safeguard liquidity.

The Act contains the following provision:

“If, as a result of government measures to combat the Covid 19 pandemic, leased land or leased premises that are not residential premises cannot be used for the tenant’s business or can be used only with considerable restrictions, it shall be presumed that, in this respect, a circumstance within the meaning of Section 313 (1) of the Civil Code, which has become the basis of the lease agreement, has changed seriously after the conclusion of the agreement.”

One can assume that with this regulation the German state wants to keep itself free from compensation payments and to shift the support needed by tenants to landlords. The payment of state compensation could possibly depend on the fact that the tenant has previously attempted to enforce a reduction in the commercial rent by invoking the aforementioned law.

The new statutory provision now establishes the (rebuttable) presumption in favor of the tenant / lessee that one of the conditions for an adjustment of the rent has been met and it is up to the landlord / lessor to rebut the presumption. This has significantly increased the chances or risks that a rent reduction can be enforced in court. Previously, the courts had been rather cautious in their rulings on the recognition of a rent adjustment or rent reduction due to the Corona pandemic.

In our view, this means that commercial tenants – not least against the background of possible consideration in the context of state reimbursement claims – should attempt to demand a rent adjustment from their landlord in a timely manner if the use of the rental space is impaired or excluded by official orders due to the Corona pandemic. For commercial landlords, conflicting questions arise: how to counter corresponding contract adjustment requests or demands for rent reductions.

Author

Find the right Legal Expert for your business

The premier guide to leading legal professionals throughout the world

Specialism
Country
Practice Area
LAWYERS RECOGNIZED
0
EVALUATIONS OF LAWYERS BY THEIR PEERS
0 m+
PRACTICE AREAS
0
COUNTRIES AROUND THE WORLD
0

Join

who are already getting the benefits
0

Sign up for the latest legal briefings and news within Global Law Experts’ community, as well as a whole host of features, editorial and conference updates direct to your email inbox.

Naturally you can unsubscribe at any time.

Newsletter Sign Up

About Us

Global Law Experts is dedicated to providing exceptional legal services to clients around the world. With a vast network of highly skilled and experienced lawyers, we are committed to delivering innovative and tailored solutions to meet the diverse needs of our clients in various jurisdictions.

Contact Us

Stay Informed

Join Mailing List

GLE