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Covid-19 Update: New Lockdown - Effects of the Federal-State Resolution of 13 December 2020 on the Commercial Rental Law

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18 December 2020

On 13 December 2020, the Federal Chancellor and the Prime Ministers of the Federal States again decided, in view of the current development of the Covid-19 pandemic, to impose far-reaching measures for contact restrictions.

As it did already last spring, this comprises among other measures the closure of large segments of the retail business and of the services sector. The addressees of these measures are the business operators, many of whom are tenants. Whereas the comparable measures in the spring included a restriction of the landlord's right to terminate on the ground of failure to pay the rent in the period from April to June 2020 (Art. 240 Sec. 2 EGBGB), the economic burdens arising from the new restrictions are now to be divided up between tenants and landlords, apparently in accordance with the principles governing frustration of contract.

Please read more about the effects of the Federal-State resolution of 13 December 2020 on commercial rental law and an initial assessment in our Client Bulletin.

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