In December 2022, the Real Estate Council (“ROZ”) adopted a new model for the lease of retail space. The model is intended for the lease of retail space and other business premises within the meaning of Section 7:290 of the Dutch Civil Code, mostly stores and catering establishments. The ROZ models are drawn up by specialists with extensive knowledge and experience and are widely used in leasing practice. This model has been drawn up from the landlord’s point of view. The previous model dates from 2012 and was due for renewal. This new model takes into account social developments, amended legislation and case law. Think of corona, amendments to the Winkeltijdenwet (Shopping Hours Act) and court decisions on the validity of a signature or on the interpretation of the penalty clause.
This article first discusses the use of the ROZ model Huurvereenkomst Winkelruimte. Then some changes and additions compared to the ROZ model retail space from 2012 are mentioned and then explained. Finally, a number of points of interest follow.
How do I use the new ROZ model Huurvereenkomst Winkelruimte en andere bedrijfsruimte in de zin van Artikel 7:290 BW, version 2022?
The model Shopping Space Lease Agreement can be used by landlord and tenant for the lease of business space that – in short – is intended as retail space or catering, such as pubs or restaurants. Landlord and tenant should fill in the model with the details of the parties and of the leased property. The lease also sets out agreements on the rental period and the rent. It is possible to make additional agreements or deviate from the model provisions. Deviations must be included in the preamble and in Article 17 of the lease.
In addition to a new model lease agreement, the ROZ has also renewed the General Provisions accompanying the lease agreement. The General Provisions are declared applicable to the lease agreement. It is important that a landlord provides the tenant with the General Provisions before signing the lease. The tenant will have to sign for receipt. The ROZ has also published a manual. This provides a brief explanation of the provisions in the model lease to be completed by the landlord and tenant.
What are the changes in the ROZ Model Retail Lease Agreement 2022 compared to the 2012 version?
Provisions have been added to the 2022 model on new topics such as electronic signing, privacy, government measures and opening hours. The sustainability article has been expanded and the ROZ provides an appendix to that article in which landlord and tenant can record what measures they have agreed upon in the context of sustainability. The ROZ also provides a turnover rent provision that can be included in the lease when parties agree on a turnover-related rent. The website of the ROZ also provides for the downloading of an official report of completion that the landlord and tenant can use at the start of the lease. The General Provisions include an article on undermining.
I discuss some of the changes and their background below.
The changes to the ROZ model Huurvereenkomst Winkelruimte
Additional barrier for tenant who wants to sue landlord
The ROZ model raises an additional barrier for a tenant who wants to sue a landlord for breach. The ROZ model uses the term “culpable serious shortcoming. In principle, this means that the tenant cannot sue the landlord in the event of an attributable shortcoming (as required by law), but that this shortcoming must also be ‘serious’. When this is the case will have to be assessed on a situation-by-situation basis.
Opening hours
Article 13 of the lease of retail space allows the landlord and tenant to establish in advance what opening hours apply to the tenant. These appear to be minimum opening hours. There seems to be no objection to a tenant wishing to be open to the public beyond the agreed opening hours, albeit at its own expense (Article 11.1 General Provisions). The background lies in a provision added to the Shopping Hours Act as of January 1, 2022. This states that a shopkeeper cannot be obliged to keep his business open longer or at different times if he has not expressly agreed to this. This prevents anyone other than the tenant, such as the landlord or shopkeepers’ association, from deciding on his opening hours. By including the opening hours in the lease, the tenant of 7:290 business premises has agreed to those opening hours.
Corona determination
Article 14 of the lease of retail space contains a provision on government measures, the so-called “corona provision. That article states that the lessor and the lessee of 7:290 business premises must consult with each other if there is a loss of rental enjoyment as a result of generally applicable government measures. These are government measures that mean that the lease cannot be maintained unchanged due to a conflict with reasonableness and fairness. This provision was included as a result of the measures taken by the government in connection with corona, such as the mandatory closure of the catering industry, lockdowns and regulations regarding 1.5 meters distance. The article is broader than corona. Even when another situation arises as a result of which the government takes measures that impede the tenant in the use of the leased property, the landlord and tenant must consult with each other. The article does provide that until other arrangements are made, the tenant will simply have to pay the full rent.
Sustainability
Article 15 of the retail lease provides for a regulation regarding the legal obligations regarding sustainability that follow from the Activities Decree Environmental Management. Energy-saving measures that can be objectively recovered within five years must be taken. In principle, these costs are borne by the tenant (Article 15.3). On the other hand, energy-saving measures taken by the tenant do not in principle have to be undone at the end of the lease. If the energy-saving measures were installed less than five years prior to the end of the lease, the tenant should in principle receive compensation for them. However, the landlord has the option of attaching conditions to his permission to install energy-saving measures.
Electronic signature
In practice, it often happens that the landlord and tenant sign the lease separately from each other. The signed lease is then scanned and sent by e-mail. To prevent one of the parties from later taking the position that the scanned signature is not legally valid, there is the option of including in the lease agreement that a scanned signature (or other type of electronic signature) is also legally valid.
Clarification of penalty clause
Regarding the penalty clause from the previous model agreement, there was a lot of ambiguity in practice and a lot of case law. The ROZ has sought to eliminate this lack of clarity. The current penalty clause in Article 28.3 of the General Provisions reads as follows: “Each time an amount due by the tenant under the lease is not paid promptly on the due date, the tenant shall forfeit to the lessor by operation of law an immediately payable penalty of 1% per month on the amount then due, with a minimum of €300 per month, with each month commenced counting as a full month.”
In the manual to the lease of retail space, the ROZ provides a calculation example for clarification. It is as follows: if a lessee fails to pay the monthly rent of € 14,000 for the months of January, February and March, the lessee owes the minimum penalty of € 300 for both January and February under Article 28.3. In March, the arrears total €42,600, i.e. three months’ rent and two penalties. In March, the tenant then owes a penalty of € 462, being 1% of the arrears.
With this, the ROZ makes it clear that there cannot be a cumulative penalty. Thus, a tenant does not owe a penalty of €300 for every month that he has not paid (in full). As an example, if the aforementioned tenant does not pay the rent for January, he owes €300 in penalties. If he still hasn’t paid the January rent in February (and the February rent has), he won’t suddenly owe a €300 penalty.
Points of attention to the new ROZ model Retail lease agreement 2022
Finally, a few points to consider when using the new ROZ model Retail Lease Agreement 2022.
- Prior to or at the start of the lease, make sure you have a good record of completion. This prevents discussions at the end of the lease. If no official report of acceptance has been drawn up at the start of the lease, the tenant must hand over the leased property in a well-maintained condition, without defects and free of damage at the end of the lease. This is subject to wear and tear and normal aging or if the tenant can prove that the leased property was not in good condition at the start.
- The starting point is that the business premises are leased as shells. Only the structural parts, such as walls and roofs, are part of the leased space. In principle, the front of the premises is not part of it. It is recommended that the parties clearly specify in the lease what, in addition to the shell, is also part of the leased space, such as floors or installations. Then it is a matter of shell plus. If this has not been laid down, maintenance, repair and renewal will be at the tenant’s expense.
- Article 5.5 of the General Provisions allows a landlord to refuse the tenant access to the leased premises if the tenant has not yet fulfilled all his obligations at the desired moment of occupation. This is understandable with respect to, for example, rent payments, but can be more difficult if a tenant of catering space first wants to renovate and during the renovation does not yet have an operating license. It is wise to establish in advance that in such a case the tenant may already use the leased space while waiting for the permit.
- If a tenant wants to change its legal form, prior written consent is required from the landlord. Consider a tenant who wants to convert his sole proprietorship into a limited liability company. Landlord and tenant should also inform each other in writing in a timely manner about other proposed changes in the organization or corporate structure.
- The premise is that tenant is obliged to join the shopkeepers’ association or similar business association. If he does not, tenant must still contribute to it.
- If the lessee and the lessor of the premises make additional arrangements during the term of the lease, the lessor may charge administrative costs of at least €300 for recording those arrangements, for example in an allonge.
Want to know more about a lease for retail space or hospitality?
In this article I outline the main changes in the new ROZ model Huurvereenkomst Winkelruimte 2022. However, there are even more points of interest in this model for both landlords and tenants of retail space and other business premises within the meaning of Section 7:290 of the Dutch Civil Code. Do you have questions about this new model or do you want to know where the points of attention are in your situation? Please contact Yvonne Jansen. She specializes in tenancy law and real estate law.
