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The entry of this new year brings with it, among others, the end of the term stipulated in Law 29/1994, of November 24, which established a transitional regime for the termination of business rental contracts previously concluded to the May 9, 1985.
Thus, as of January 1, 2020, tenants who want to keep their business open in the same premises, are obliged to update their rental contracts. However, there are certain circumstances that may not lead to this automatic termination.
A distinction should be made between tenants who arenatural person and whateverlegal person:
Physical person: In the event that the tenant is a natural person, the contract will expire when he retires or dies, unless his spouse continues with the activity. If the person continuing the business were a descendant, the contract would expire on January 1, 2020.
Legal person: In these cases, the lease will expire on January 1, 2020, unless the premises have a surface area of more than 2,500 m2, or if no commercial activities are carried out there.
In both cases, and in the event that there is a transfer of the premises in the previous ten years January 1, 1995, the duration of the “old rental” contract could be maintained until January 1, 2020.
What rights does the tenant have in the event of termination of the contract?
1st) Right to compensation, whose amount will be 18 monthly payments of the rent in force at the time of termination of the contract, provided that before 1 year any person exercises the same activity or one that is considered related.
2nd)Preferential right to continue in the premises. Si before a year has elapsed from completion, the lessor intends to enter into a new contract, he must reliably notify the previous tenant of the new circumstances (rent, essential conditions, details of the new lessor), granting him a within 30 calendar days after notification so that you can exercise your right to continue in the premises under the same conditions as those offered to the other tenant.
In any case, the exercise of the preferential right will be incompatible with the compensation. (Photo: Pixabay)Author of this post
Manuel Pomares, is a lawyer and managing partner of the firm Pomares Abogados. Specialist in commercial-corporate, bankruptcy and banking law ...