Tenants of commercial premises have until the 23rd of May 2020 to request a moratorium on rent for businesses.
This was approved by Royal Decree-Law 15/2020 to support the economy and employment of Spain during the State of Alarm. This Royal Decree-Law 15/2020 was quite a complicated one covering measures of all kinds.
Including a moratorium of rent for businesses. A moratorium being a temporary postponement. This depends on the type of owner of the property. And also if a voluntary agreement between both parties (owner and tenant) on the moratorium, temporary deferment or reduction of the rent could not be reached.
a) WHEN THE LANDLORD IS A COMPANY OR OR LARGE PROPERTY HOLDER (more than 10 urban properties or more than 1,500m2 of property use not including garages and storage rooms). In this case up until 23rd May 2020, the tenant, whether a person or legal entity, may request to the owner a moratorium on the payment
of the rent. This is rent due during the State of Alarm and its extensions, month by month, and up to a maximum of four more months after in case that period was insufficient for the situation of economic vulnerability caused by COVID-19 to end.
No interest is accrued and agreement is applied automatically. It doesn’t require the consent of the landlord. Although specific formal and documentary requirements must be met. The deferred rental payments will be paid to the landlord without any type of penalty and may be paid gradually over the next two years maximum. From the moment the State of Alarm is lifted or from the end of the term of the four months referred to above.
Not a Company
b) WHEN THE LANDLORD IS NOT A COMPANY OR A LARGE PROPERTY HOLDER the same applies. Until 23rd May, the tenant, whether a person or legal entity, may request to the owner a moratorium on the payment of the rent due during the State of Alarm. And for its eventual extensions, month by month, and up to a maximum of four more months after. (In case that period was insufficient in relation to the situation of economic vulnerability caused by COVID-19).
c) FORMAL REQUIREMENTS
When the tenant is self-employed: – they must be affiliated and registered, at the time of the declaration of the State of Alarm, in the Special Scheme
for Self-Employed Workers. So that your activity has been suspended
due to the State of Alarm.
If your activity has not been suspended, you must prove a reduction in the billing of the calendar month prior to the one for which you request the moratorium. This needs to be by at least 75%. This is relative to the average monthly turnover of the quarter, with reference to the previous year.
The tenant must prove the reduction to the landlord, based on accounting information, income and expense. Which will initially be supported by presenting a “responsible statement” if you do not have all the paperwork needed.
We can help you with the necessary paperwork and formalities. Should you need assistance, just let us know.