Moratorium on rental payments approved by the Government
The Royal Decree 15/2020 of April 21th 2020, published in the BOE (Boletín Oficial del Estado), establishes the requirements, decided by the Government, for people who are self-employed and for companies to be able to appeal to the moratorium on rental payments.
” The moratorium allows to defer all rental payments at least until September 2020.”
This moratorium allows the deferment, without risks of penalties or interests, of all rental payments until four months after the State of Alert and its extensions. The full amount of these rental payments, divided into an installment plan, must be paid within a maximum period of two years and always within the term of the lease and its extensions. Therefore, if the remaining period of the lease is less than two years, the installment payments must be divided over the remaining months.
“Without the landlord being able to take eviction actions for a non-payment of the rent during said term. This moratorium does not prevent a landlord from proceeding eviction actions for other reasons.”
In this way, the moratorium allows to defer all rental payments at least until September 2020, the landlord can not proceed eviction actions for a non-payment of the rent during said term. However, we understand that the moratorium would not prevent the landlord from taking eviction actions for other reasons, such as an expiration of the term of the contract or even the non-payment of other contractual agreed amounts such as water, electricity, community fees, etc.
“It is essential for the tenant to present a written request to the landlord before May 23th, 2020”
To be able to appeal to this moratorium, it is essential for the tenant to present a written request to the landlord before May 23th, 2020. Obviously, the parties may try to agree on what they deem appropriate, they are empowered to use the deposit with a refund obligation within one year. In case there is no agreement, the landlord is obliged to respect the terms of the moratorium imposed by Royal Decree Law 15/2020, which will then operate automatically, and which pushes the parties even more to try to reach an agreement.
“If there is no agreement, the landlord is obliged to respect the terms of the moratorium…which pushes the parties even more to try to reach an agreement”
The moratorium not only affects the lease of the typical business premises, but will be applied to all leases, except for housing. Applicable for this measure are seasonal leases, or those held to exercise an industrial, commercial, artisanal, professional, recreational, healthcare, cultural or teaching activity.
“The moratorium not only affects the lease of the typical business premises, but will apply to all leases for use other than housing – seasonal leases – or even industry”
In a previous blog post, before the publication of the moratorium, we already suggested to try to reach an agreement, balancing the contractual benefits for both parties. Today more than ever this premise becomes vital, as the Royal Decree allows to defer rental payments. It will also annihilate any possibility of negotiation for the tenant in the near future, who will face the increase of the rent due to the addition of the amount of deferred rents.
At Lajares Law Offices we have more than 50 years of combined experience as practicing lawyers. We are here to advise you, and to assist you during necessary negotiations which will reassure you and give you peace of mind.