COVID-19. The impact of the State of Emergency on leases
Dear clients!
Not long ago, we examined the impact of the spread of coronavirus infection on rental relations from the point of view of recognizing the pandemic as a force majeure circumstance.
As part of the above review, we explained that recognizing the COVID-19 pandemic as a force majeure circumstance (force majeure) can relieve the tenant from penalties for late payment of rent, providing a kind of deferment for payment, but not excluding the obligation to pay altogether. In this case, the tenant is required to prove the relationship between the inability to timely fulfill the obligation to pay rent and the consequences of the spread of the COVID-19 pandemic.
However, the possibility of deferring the payment of rent is a positive thing for small and medium-sized businesses, but is not a solution to the problem as a whole, since it creates a voluminous obligation to pay all rent in the future.
Many were interested in the possibility of excluding rent payments during the spread of coronavirus infection or the possibility of reducing it, since COVID-19 had a negative impact on almost all business sectors and caused financial losses. However, there was no clear answer to these questions.
On April 1, 2020, Federal Law No. 98-FZ “On Amendments to Certain Legislative Acts of the Russian Federation on the Prevention and Elimination of Emergency Situations” was published, which brought some clarity to rental legal relations during the introduction of a high alert or emergency regime.
Author:Paul BalyukAdvisor, lawyer GRATA International St. Petersburg
Email: PBalyuk@gratanet.com
Contacts: +7 (812) 384 48 38
