6 April 2020

Retailers stop paying rent in times of COVID-19: can they invoke force majeure?

There is a lot of uncertainty about the consequences of the corona-virus. Not only does it have an enormous impact on social life, it also has a very significant impact on economic life. Especially as regards the execution of commercial contracts there is a lot of ambiguity.

One of the major questions raised in this respect is whether a tenant could decide to suspend or reduce his payment obligations because of the corona-crisis and the containment measures taken by the government. Or can the landlord insist on rent payment? This is especially relevant for stores that were, by government order, forced to close or significantly reduce their capacity as of 13 March 2020.

To cut right to the chase: there is no ready-made, black-or-white answer to this question. The large number of publications on this topic since the outbreak of the crisis illustrates this unambiguously.

In this publication we therefore give some points of consideration for tenants and landlords, without being exhaustive.

One thing must, however, always be kept in mind: just as for many other issues raised by the corona-crisis, the evaluation of the precise circumstances of every case will eventually be decisive. Also specific contractual provisions will have to be considered. As long as no legislative initiatives are taken by the Belgian government it will therefore be up to the courts to finally decide.

Read the full article here.

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