jurisdiction

Updated on 20.03.2020.

1. Is a lessee eligible for rent reduction due to a significant decline in footfall and consequently its turnover as a result of COVID-19?

In principle not, but the COVID-19 situation might constitute legal grounds for a revision of the terms in the contract.

2. Is a lessee eligible to temporarily close its leased space - on its own initiative – and opt for rent reduction as a result of COVID-19?

The lessee may close the premises on its own initiative, if the lease agreement does not forbid it. The lessee will in principle not be able to demand a rent reduction upon closing on its own initiative but might have legal grounds for a revision of the terms in the lease due to the COVID-19 situation.

3. Is a lessee eligible for rent reduction in the event its leased space is closed following an order by the Government as a result of COVID-19?

Principally, a lessee is obliged to pay its rent even if its premises are closed by order from the authorities. But again, there might be legal grounds for a revision of the lease so the obligation to pay rent can be reduced or removed for a period.

4. What kind of security is generally provided by a tenant in connection with a lease, a bank guarantee, a deposit or otherwise?

Generally, security is most commonly provided in form of a bank guarantee, a deposit or a parent company guarantee.

There might be legal grounds for claiming reduced payments or termination.