The corona pandemic is currently keeping the whole country in a headlock, affecting almost all areas of life. Cinemas and theatres are closed, restaurants and bars remain closed, as do schools. Most small shops have been forced to close or are only allowed to operate to a very limited extent. Many employees are working from home if they can. Small businesses are particularly affected by these severe economic cuts, as their income is lost. Employees also have to reckon with financial losses. Many are now asking themselves how they are going to pay the rent for their home or shop, for example.
This article will first explain the basic legal situation. Furthermore, the Federal Government has adopted measures to prevent such concerns. It will therefore also explain what the newly adopted measures mean for you in concrete terms.
Basic regulations in tenancy law
Tenancy law is regulated in the German Civil Code (BGB) for both residential and commercial leases. It can be found in Sections 535 - 597 BGB and contains, among other things, regulations on the cancellation of the tenancy agreement. Open-ended tenancy agreements can either be terminated within a period of notice or without notice. Extraordinary termination without notice may only be given for good cause in accordance with Section 543 I 1 BGB. Good cause exists, for example, if a tenant is rowdy in the rented flat or is guilty of similar offences. However, according to Section 543 II 1 No. 3 BGB, good cause also exists in particular if the tenant fails to pay the rent twice in succession. If the rent is for residential property, the tenant can render the termination ineffective once by paying the rent immediately in arrears in accordance with Section 569 III no. 2 sentence 1 BGB. However, this does not apply, for example, to entrepreneurs who have rented shop premises. In principle, it does not matter why the tenant is unable to pay. If the salary or income from the shop is cancelled so that the rent cannot be paid for more than two months, there is a risk of termination. Such financial difficulties are particularly to be feared during the coronavirus crisis.
Temporary amendment of tenancy law by the federal government
In order to counteract fears of termination due to financial hardship caused by the coronavirus crisis, the federal government has decided to temporarily amend tenancy law. The possibility of termination without notice (and also ordinary termination in accordance with Section 573 BGB) due to non-payment of rent has been restricted for the period from 1 April 2020 to 30 June 2020. It has decided to introduce Article 240 of the Introductory Act to the German Civil Code (EGBGB), Section 2 (1) of which stipulates the following:
"The landlord may not terminate a tenancy agreement for land or premises.
solely for the reason that the tenant will not be able to move out in the period from 1 April 2020 to 30 June
2020 does not pay the rent despite the due date, provided that the non-payment is due to the effects of
of the COVID-19 pandemic. The connection between the COVID-19 pandemic and
Non-performance must be substantiated. Other cancellation rights remain unaffected."
This means that a cancellation due to outstanding rent from April to June is invalid if the payment problems are due to the coronavirus crisis. This is an exception to the principle that the reason for the payment problem is irrelevant to the validity of the cancellation. If the reason is the effect of the coronavirus crisis, the cancellation is invalid.
However, the tenant must credibly demonstrate that there is a connection between the coronavirus crisis and the non-payment. It must therefore be probable that their non-payment of rent is due to the consequences of the pandemic. The explanatory memorandum to the law sets out a number of ways in which this prima facie case can be made.
- by affirmation in lieu of an oath
- through the application or certificate for the granting of state benefits
- by a certificate from the employer confirming the loss of earnings
- by other certificates confirming the loss of income
For traders whose business has been prohibited by an authority in the context of combating the spread of the virus, the mere reference to the official prohibition is sufficient.
Furthermore, the last sentence clarifies that other termination rights of the landlord remain unaffected. This means that if there are rent arrears from an earlier period, these must still be paid or their non-payment can still lead to effective termination. And the landlord can also continue to terminate the contract for other faults, e.g. rioting in the flat. After all, only payment defaults related to the coronavirus crisis are to be "absorbed".
Section 2 (4) also stipulates that this protection against dismissal is valid until 30 June.2022 applies. This means that the accrued rent arrears must be paid by the end of June 2022. If this is not done, the tenancy can be effectively terminated. Tenants therefore have 2 years to pay the rent in arrears. This means that the landlords still get their money, but the tenants have a breather to find the money.
What do I do as a tenant if I cannot pay my rent on time in the period from April to June inclusive?
- Inform landlord
- Obtain a certificate of loss of earnings or income (e.g. from your employer)
or, if you are entitled to state benefits, apply for them (keep the application and/or certificate)
As a trader (e.g. hotelier, innkeeper, etc.) keep the official order on the basis of which the business operation was prohibited
- Pay rent in arrears until 30 June 2022
As a landlord, you can terminate the lease again from 1 July 2022 if outstanding rents from the period from April to June 2020 inclusive are not paid in arrears.
Important Note: The content of this article has been prepared to the best of our knowledge and belief. However, due to the complexity and constant evolution of the subject matter, we must exclude liability and warranty. Important Notice: The content of this article has been created to the best of our knowledge and understanding. However, due to the complexity and constant changes in the subject matter, we must exclude any liability and warranty.
If you need legal advice, please feel free to call us at 0221 - 80187670 or send us an email at or send an email to info@mth-partner.de info@mth-partner.de
Lawyers in Cologne provide advice and representation in tenancy law.