These government policies also have a significant impact on the position of tenants and lessors, as some premises must be closed or face significant restrictions of their use. As we have stated in our previous blogs, restrictions on a tenant’s activity or the activities of tenant’s clients do not directly entitle to an exemption or a reduction from rent under the Act on Commercial Leases.
If any of the terms of the lease were to become permanently unfair based on the imposed restrictions, they could be made reasonable according to the provision related to adjusting in section 5 of the Act on Commercial Leases. As the restrictions caused by the coronavirus are temporary, there is generally no justification for making the terms of the contract permanently reasonable. Temporary restrictions imposed on the use of leased premises may create a force majeure situation which may affect, for example, a tenant's ability to meet his contractual obligations.