Member Article

For supermarkets only one person per 10m² sales surface is allowed to be inside the store for a period of 30 minutes.

Travelling outside of Belgium which is considered not essential is not allowed.

What does this mean for all lease agreements concerned?

Following the request of the WHO earlier during the day, the Belgian Federal government has once more imposed more intrusive health measures to reduce the risk of the spread of Covid-19 by closing almost all shops as well as leisure and recreational areas, as well as bars, restaurants, and cinemas. Schools will no longer provide classes, but will still provide care for children whose parents work in the health sector or who cannot provide for alternative care.

The tenants concerned can thus no longer operate their shops and be open for business during normal business hours.

These measures can be considered as an “act of God/fait du Prince” for both tenant and landlord. The parties have no option but to abide by the government measures. Such forced closure can be considered as a force majeure (whereas the economic impact of fewer visitors during the preceding weeks due to fear of the illness is not as such force majeure). Force majeure implies that both parties are (partially and/or temporarily) relieved from complying with their contractual obligations.

Be aware the suspension of certain obligations does not imply the total suspension of the agreements. In this situation, all parties should look into their lease agreements to review the clauses dealing with hardship and force majeure, in particular concerning "acts of god" and the notification formalities towards their co-contracting parties.

Are the measures to date severe enough to invoke a dissolution or annulment of a lease agreement?

As the measures are for the time being limited to three weeks, they do not seem, in general, to form a substantial basis for invoking the dissolution or annulment of a lease agreement, except for any lease agreement whose term/duration essentially falls within these 3 weeks, e.g. a pre-Easter pop-up store lease. Thus in most cases invoking the dissolution or annulment of a lease agreement now would be considered disproportionate or even an abuse of right.

The Flemish Regional Government has already indicated at the occasion of the previous measures to provide for an economic indemnity in the amount of €4,000 for closed bars and restaurants, and € 2,000 for shops having to close in weekends. An amount of €160/day is said to be granted for any additional day after 3 April 2020.

If you have any queries concerning your lease agreements, please do not hesitate to contact your usual ALTIUS contact or Lieven Peeters, Real Estate Partner.

The above information is merely intended as comment on relevant issues of Belgian law and is not intended as legal advice. Before taking action or relying on the comments and the information given, please seek specific advice on the matters that are of concern to you.