Russia - Lease Contracts

On April 1, 2020, the federal law “On Amending Certain Legislative Acts of the Russian Federation on the Prevention and Response of Emergencies” of March 31, 2020 came into force, hereinafter the Federal Law. Article 19 of the Federal Law establishes a number of privileges for tenants of real estate with respect to lease contracts of real estate concluded before the introduction of the high alert in the relevant region. Part one of Art. 19 of the Federal Law obliges the landlord to conclude an additional agreement within 30 days from the day the tenant appeals, providing for a deferment of payment of the rent stipulated in 2020. Requirements for the conditions and terms of such a delay are established by the Government of the Russian Federation. As of the date of preparation of this newsflash, the corresponding act has not yet been adopted by the Government of the Russian Federation. Part two of aforementioned article provides for the possibility of changing the amount of rent by agreement of the parties at any time during 2020. Finally, the third part of Article 19 allows the tenants to demand a reduction in rent for the corresponding period of 2020 due to the inability to use property associated with the adoption by the state authority of the subject of the Russian decision on the introduction of a high alert or emergency on the territory of the subject of the Russian Federation. The high alert mode in certain regions was introduced at different times, for example, on March 5, 2020 in Moscow, March 13, 2020 in St. Petersburg. Since March 19, the high alert mode has been operating in all regions of the Russian Federation. We will be happy to give further advice on this matter, as well as help prepare the appropriate appeals to landlords.

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