Provision of deferred payment of rent to persons most affected by the coronavirus pandemic

On 04/06/2020, the Decree of the Government of the Russian Federation No. 439 dated 04/03/2020 (hereinafter referred to as the "Resolution") was published, which clarified the procedure for granting a deferral on payment of rent. The possibility of obtaining such a postponement was introduced earlier by Federal Law No. 98-FZ dated 01.04.2020 "On Amendments to Certain Legislative Acts of the Russian Federation on the Prevention and Liquidation of Emergency Situations" (hereinafter referred to as the "Law").

According to the Resolution, a deferral on payment of rent should be provided to tenants – companies and individual entrepreneurs (but not individuals) from the sectors of the economy most affected by the coronavirus pandemic. The specified list includes the following industries:
air transportation, airport activities, road transportation;
culture, leisure and entertainment organization;
physical culture and recreation activities and sports;
activities of travel agencies and other organizations providing services in the field of tourism;
hotel business;
public catering;
activities of organizations of additional education, non-governmental educational institutions;
organization of conferences and exhibitions;
activities for the provision of household services to the population (repair, laundry, dry cleaning, hairdressing and beauty salon services).
At the same time, a deferred payment of rent can be obtained in respect of leased real estate of all forms of ownership (including private), with the exception of residential premises.

As previously indicated in the Law, such a deferral will apply to lease agreements concluded before the introduction of a high–alert or emergency situation by the relevant subject of the Russian Federation (hereinafter referred to as the "Regime"). Recall that a high-alert mode was introduced in Moscow on 05.03.2020.

The total period for granting a deferral begins from the moment the Regime is introduced and ends on 01.10.2020. This period is divided into two stages:

1)   during the period of the Regime, the tenant has the right not to pay rent, except for payments for utilities and (or) maintenance of property, if these payments are included in the rent and the landlord has not been released from them;

2)   in the period from the date of termination of the Regime until 01.10.2020, the tenant has the right to pay 50% of the rent.

The granting of a deferral must be formalized by an additional agreement to the lease agreement, which the lessor is obliged to conclude with the lessee within 30 days after the relevant application of the latter according to the Law. At the same time, the lessor does not have the right to charge the lessee any additional payments in connection with the provision of a deferral.

In this agreement, it is necessary to regulate the procedure for the subsequent payment of the debt on lease payments formed during the deferral. There are a number of mandatory requirements in this regard:

1)   the beginning of debt payment — no earlier than 01.01.2021, the end – no later than 01.01.2023.;

2)   the debt is payable in equal installments no more than once a month;

3)   the amount of one payment should be no more than half of the monthly fee under the lease agreement.

It should be noted that landlords who have granted their tenants a deferral on payment of rent in accordance with the Resolution are also recommended to coordinate with tenants a reduction in the amount of rent (however, such an obligation is not directly imposed on them by the Resolution).

The competent authorities of the constituent entities of the Russian Federation and local self-government bodies are recommended to provide support measures for the payment of taxes (property tax and land tax) for real estate owners who have provided their tenants with the specified deferral.