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Legal regulation of real estate leases in connection with the coronavirus pandemic

On 23 April 2020, the Parliament of the Czech Republic discussed and approved two draft laws on mitigating the effects of the coronavirus pandemic on lessees of commercial and residential real estate.

Legal regulation of real estate leases in connection with the coronavirus pandemic Source: Adobe Stock

The bill regulates the lease, sublease and also usufructuary leases of business premises. Its aim is to provide a lessee with certainty for a specified period of time that its lease will not be unilaterally terminated by the lessor solely due to a delay in the payment of rent under the conditions set out by this act.

Initially, this act was also to cover delays in the payment of services related to the use of business premises. However, due to the imbalance emerging from the situation where a lessor has to continue to pay to suppliers for energies and other services, this part has been deleted and the protection of the lessee will thus only concern any delay in paying rent.

The lessee will be obliged to pay for services connected with the use of the business premises in the same way as before with the same risks in the event of a delay. A lessor thus may not terminate a lease, sublease or usufructuary lease agreement, or withdraw from these contracts during the so-called protection period, which is set as the period from the entry into force of this act until 31 December 2020. Download the full article here.