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Q&A Section On Covid19 and International Contracts

30 April 2020


Russian Government decided to support tenants and lessees during these uncertain times and provided “rent holidays” to the leasing businesses. More specifically, according to the recently issued Resolution of the Russian Government No. 439 dated April 3, 2020 “On requirements to conditions and periods of postponement of rent payments under real estate leases (the “Resolution”) a tenant is now entitled to postpone rent payments in case the following conditions are met: (a) lease is made in relation to any real estate, except for residential one; (b) lease is made before the launch by the relevant Russian region of the regime of high-alert or extreme situation (the “Regime”); and (c) tenant’s activity falls under the list of the most injured industries due to the spread of Covid-19.Rent payments may be postponed from the date of introduction of the Regime by the respective Russian region until 1 October 2020. Upon termination of the Regime and until 1 October 2020 the tenant may postpone 50% of rent payments. The parties may decrease the amount of rent which should be postponed under the additional (amendment) agreement. Operating expenses and other utility payments may not be postponed even if they are included in the rent (and not provided separately), except when the landlord is released from such payments under the regulations of the respective Russian region. The tenant who meets the criteria mentioned above shall approach the landlord and ask it to sign the lease amendment agreement. The amendment agreement should be concluded within 30 days. In case of a long-term lease the amendment agreement must also be registered. Finally, landlords are prohibited to ask for any penalties, interests or any other payments, including those already provided for in the lease agreements.

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