On April 13, 2020 Verkhovna Rada of Ukraine amended the legislation regarding lessees’ rights to demand a reduction of rental rate for the quarantine period.
The following new provisions have been established until the quarantine is terminated:
1. Payment for the use of immovable property shall be reduced at the request of the lessee throughout the entire period when the property could not have been used in full because of the restrictions imposed.
2. The amount of payment shall be agreed upon by the parties to the lease agreement. However, the maximum amount of payment may not exceed the aggregate amount of expenses that the lessor has made or will have to make in the relevant period for land payment, real estate tax payment, utility costs (in proportion to the rented space).
3. If the lease agreement already stipulates that the lessee pays the specified expenses on his/her own, then in that case additional amounts of rent are not paid.
The key idea behind these changes is that the lessee pays only his or her share for the maintenance of property (utilities and taxes) for the period for which the use of property is prohibited due to the quarantine. To do this, the parties to the lease agreement must conclude an agreement.
These provisions apply only to legal entities and individuals – lessees who engage in business activities using leased property. That is, to individuals or legal entities that are not business entities (citizens, public and religious organizations, etc.), this rule does not apply. Also, these benefits will not apply to the lease of communal property.