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Amendments introduced in relation to previously approved measures to support tenants of primary residences under the Fourth Final Provision of Royal Decree-Law 16/2020

| COVID-19 | Corporate Law and M&A

Regarding Royal Decree Law 16/2020 of 28 April on procedural and organisational measures to deal with COVID-19 in the area of the administration of justice

On 28 April, the Council of Ministers approved Real Decreto-Ley 16/2020 Royal Decree-Law 16/2020, on procedural and organisational measures to deal with COVID-19 in the area of the Administration of Justice (hereinafter, "RD-L 16/2020"), with the aim of providing an agile solution to the accumulation of procedures suspended due to the declaration of the state of alarm when said procedures are reactivated, as well as preventing the increase in litigation that will occur as a result of the extraordinary measures adopted and the economic situation itself derived from the health crisis. In this context, various measures of a procedural, bankruptcy, corporate, organisational or technological nature are approved and, likewise, certain adjustments are made to various legal texts previously approved during the state of alert.

Among these amendments are those introduced by the Fourth Final Provision of the aforementioned RD-L 16/2020, by virtue of which, specifically the first three sections thereof, certain articles of the previous Royal Decree-Law 11/2020, which adopted additional urgent measures in the social and economic sphere to address COVID-19 (hereinafter, "RD-L 11/2020"), relating to leases of primary residence, are amended as set forth below:

  1. Extension of the deadline for applying for a rental debt moratorium in cases of "large holder" or "public housing company or entity”

Section One of the Fourth Final Provision of RD-L 16/2020 extends the period initially provided for in Article 4 of RD-L 11/2020 so that the tenant may request from his landlord a moratorium on the payment of rent, in cases where the landlord is a "large holder" or a "public housing company or entity", increasing this period from one (1) to three (3) months as from the effective date of RD-L 11/2020 (i.e. as from 2nd April). For these purposes, it should be recalled that a lessor (individual or legal entity) will be considered a "large holder" when it owns more than 10 pieces of urban real estate, excluding garages and storage rooms, or a built area of more than 1,500 m2.

  1. Extension of the deadline for applying for a moratorium on rental debt in all other cases

In the same way, but in relation to those rental contracts for habitual residence in which the lessor does not have the condition of "large holder" or "public housing company or entity", section Two of the Fourth Final Provision of RD-L 16/2020 also extends from one (1) to three (3) months, As from the entry into force of RD-L 11/2020, the period provided for in Article 8 of RD-L 11/2020 for the lessee to request the aforementioned moratorium on the rental debt from its lessor, although it should be remembered that, in these cases, the aforementioned RD-L 11/2020 made the application of the moratorium requested subject to acceptance by the lessor.

  1. Flexibility in the granting of transitional financing aid to vulnerable tenants

Finally, paragraph Three of the Fourth Final Provision of RD-L 16/2020 adds three new paragraphs to Article 9 of RD-L 11/2020, which regulated the financing to be offered by financial institutions, with the coverage of a line of public guarantees, for the payment of rent under lease contracts in cases where the lessees are in a situation of economic vulnerability. The aforementioned amendments introduced by RD-L 16/2020 are intended to make the processing of the aforementioned transitional financing aids more agile, so that they can become operational as soon as possible for lessees who are entitled to them (essentially, exempting the Ministerial Order that must define the criteria and requirements of the beneficiaries of the transitional financing aids for the payment of income from the appropriate authorization of the Council of Ministers and, likewise, establishing that the verification of compliance with said requirements will be carried out ''ex post'' by the competent body - that is, the Ministry of Transport, Mobility and Urban Agenda).

We hope the information is useful and of your interest. At Andersen Tax & Legal we have created a multidisciplinary team to attend to all the questions that may arise on this aspect or in relation to the COVID-19.

You can download the full PDF file here

For more information please contact:

Guillermo Yuste | Pertner in the Corporate Law area

Pedro J. Albarracín | Director in the Corporate Law area


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