Overview of retail lease agreements in The Netherlands

Retail lease agreements are usually concluded based on a ROZ model (the ROZ is the Real Estate Council of the Netherlands). This overview is therefore based on the Dutch Civil Code and the latest ROZ model for retail spaces dated 2012. Please be informed that a new ROZ model is expected first half of 2023. Some of the stipulations arising from the Dutch Civil Code  are semi-mandatory – meaning that the tenant can declare stipulations against its interests to be void, unless  the court has given its approval to said stipulations. The  ROZ model is not in conflict with the Dutch Civil Code.

In the event that the parties agree to a lease term that is not longer than two years, the lease agreement will terminate at the end of the agreed lease term.

If the parties agree to a lease term between two and five years, the lease agreement applies for a period of five years by operation of law. Unless (i) the parties agree on termination of the lease agreement by mutual consent, (ii) the tenant terminates the lease agreement towards the end of the initial term or (iii) the court rules in favour of an action to terminate the lease agreement by  the landlord, the lease agreement will renew by operation of law for a subsequent term of five years.

Such court action by the landlord (iii) can only be successful on limited statutory grounds.

If the duration of the initial lease term is longer than five years but shorter than ten years, the agreed initial lease term applies and it will renew by operation of law with a term of ten years minus the agreed initial lease term.

Unless the parties agree on termination of the lease agreement by mutual consent, the tenant terminates the lease agreement towards the end of the renewal term or the court rules in favour of an action to terminate the lease agreement by the landlord, the lease agreement will renew by operation of law for an indefinite period of time or the definite period of time as agreed upon in the lease agreement. Such action by the landlord can only be successful on limited statutory grounds, although they are broader than at the end of the first five-year term. This is a semi-mandatory statutory provision.

The lease agreement may be terminated by the landlord only in the case of unforeseen events that are not at the landlord’s risk and are of such grave nature that the tenant cannot, on the basis of reasonableness and fairness, expect the continuation of the lease agreement.

In that case, a court needs to grant a claim to set aside i.e. terminate  the lease agreement, which will only happen in the event of exceptional circumstances.

The lease agreement may be terminated by the tenant only in the event of unforeseen events that are not at the tenant’s risk and are of such grave nature that the landlord cannot, on the basis of reasonableness and fairness, expect the continuation of the lease agreement.

In that case, a court needs to grant a claim to set aside i.e. terminate  the lease agreement, which will only happen in the event of exceptional circumstances.

As giving the tenant early termination rights is to its benefit, it is possible to agree otherwise. The ROZ model does not contain such a provision, but the parties are free to agree on premature termination rights for the tenant.

See the section regarding minimum and maximum duration. The lease agreement renews by operation of law, unless the court grants an action for termination by the landlord. For the other ways of terminating the lease agreement, the tenant’s consent is required.

If the rent is not in line with the rent for similar retail spaces, both parties can bring an action before the court to revise the rent. If a lease agreement with an initial definite term applies, this action can be brought before the court upon the expiry of the term. Upon the expiry of the initial term, a request for rent revision can be brought before the court (i) after expiry of the subsequent definite term or (ii) at least five years as from the day on which the parties agreed to a new rent or an action to revise the rent was brought before the court.

This is a semi-mandatory statutory provision.

There are no statutory obligations applicable to the tenant regarding fitting-out works. The parties are free to make their own arrangements. As a rule of thumb, the tenant is responsible for the maintenance, repair and renewal of fitting-out works that the tenant has installed itself.

The tenant is obliged to reinstate the premises to the same state in which they were delivered at the commencement of the lease agreement. This does not apply to changes or additions that were approved by the landlord or normal wear and tear.

This is not a semi-mandatory stipulation. The ROZ model includes that the tenant is obliged to reinstate the premises to the same state as they were delivered at the commencement of the lease agreement, except normal wear and tear.

Subleasing does not require the landlord’s consent, unless the tenant should expect that the landlord will have reasonable objections to a specific sublease. The transfer of the lease agreement requires the landlord’s approval or  authorization by the Court.

Neither provision is semi-mandatory. The ROZ model stipulates that the landlord’s approval is required for both a sublease and a transfer of the lease agreement.

If the landlord sells the premises, the lease agreement is binding on the new owner of the premises. This is a mandatory provision.

The tenant has no statutory pre-emption right in the case of the sale of the premises, but the parties are free to contractually agree upon such a right.

There are no mandatory provisions regarding the form and/or   duration of a rental guarantee.

The ROZ model stipulates that the tenant must either furnish a bank guarantee or pay a deposit. The landlord is allowed to claim under the bank guarantee or deposit until six (6) months after the lease agreement ends and the premises are vacated.

The landlord is obliged to take care of maintenance of the premises. Furthermore, the landlord is obliged to repair defects at the request of the tenant, unless it is impossible to do so, the costs of repair are unreasonable given the circumstances, the defects involve ‘minor repairs’ or the defects were caused by the tenant.

The tenant is obliged to execute ‘minor repairs’, i.e. tenant and do not result in costs that are too high and/ or require specialist knowledge, unless the damage is a result of a breach of the landlord’s obligation to repair defects.

Neither stipulation is semi-mandatory. The ROZ      model includes the same, with the exception that the tenant is responsible for the maintenance and repair of changes and additions that it made to the premises.

Rent and service charges are not subject to VAT, but in practice, parties opt for rent subject to 21% VAT.

There are no other important legal provisions or practices.