In commercial leases, deadlines decide cases. A tenant who sends the request to renew a commercial lease one day too late loses that right — however good the relationship with the landlord, and however valuable the business. This page sets out the duration, renewal, termination and eviction indemnity of a commercial lease in Belgium (handelshuur / bail commercial), for tenants and landlords alike.
When does the Commercial Leases Act apply?
The Commercial Leases Act of 30 April 1951 (Handelshuurwet / loi sur les baux commerciaux) applies to the lease of a property that, with the landlord’s consent, is used mainly for retail trade or for the business of a craftsman, in direct contact with the public. An office, a warehouse without public access or a liberal profession is in principle excluded.
This distinction is the first thing we check: it determines whether you enjoy the protection of the Commercial Leases Act or fall under the general law of leases.
Duration of a commercial lease: nine years, with exit points
A commercial lease runs for at least nine years. The tenant may end the lease at the expiry of each three-year period, giving six months’ notice by registered letter or bailiff’s writ (deurwaardersexploot / exploit d’huissier de justice). The parties may also end the current lease at any time by mutual agreement, provided that agreement is recorded in an authentic deed (authentieke akte / acte authentique) or in a declaration made before the court. In Wallonia, a written deed submitted for registration has been sufficient since 2018 (Walloon Decree of 15 March 2018).
The landlord may only end the lease at the expiry of a three-year period if the contract expressly grants him that right. Even then, he may do so only in order to actually carry on a business in the premises himself, or through certain close relatives, and subject to one year’s notice (Article 3 of the Commercial Leases Act).
There are also short-term commercial leases — so-called “pop-up leases” — which are governed by separate regional rules and do not fall under the same protective regime.
Commercial lease renewal: the deadline that decides everything
The tenant is entitled to three renewals of nine years each. A tenant who wishes to continue trading must request renewal between the eighteenth and the fifteenth month before the end of the current lease, failing which the right is forfeited. The request must be sent by registered letter or bailiff’s writ; an ordinary letter, a courier or an ordinary email is not sufficient.
The request must state the conditions on which the tenant is prepared to enter into the new lease. It must also state that the landlord will be deemed to agree unless he replies in the same form within three months. If either statement is missing, the request is void (Article 14 of the Commercial Leases Act).
The landlord then has three months to reply, also by registered letter or bailiff’s writ. He may accept, refuse on a statutory ground, propose other conditions or notify a higher offer from a third party. If he does not reply within that period, he is deemed to agree to the proposed conditions.
If the landlord proposes other conditions and the parties cannot agree, the tenant must bring the matter before the justice of the peace (vrederechter / juge de paix) within thirty days of the landlord’s reply, failing which the right is forfeited (Article 18 of the Commercial Leases Act). For both parties, renewal is therefore a date for the diary, not a formality.
When may the landlord refuse renewal?
The law lists the grounds for refusal exhaustively. The most important in practice: the landlord wishes to occupy the premises personally or have them occupied by certain close relatives; he wishes to use the property for a purpose involving no commercial activity; he wishes to rebuild the building, which goes beyond ordinary renovation; the tenant has seriously breached his obligations; or the tenant refuses to match a higher offer from a third party.
Each of these grounds presupposes a concrete and demonstrable intention — a general statement is not enough.
The eviction indemnity: what does a refusal cost?
If renewal is refused, the tenant is in many cases entitled to an eviction indemnity (uitzettingsvergoeding / indemnité d’éviction). It is not a single flat amount: Article 25 of the Commercial Leases Act sets out a graduated scale depending on the ground for refusal.
- One year’s rent where the landlord puts the property to a non-commercial use or rebuilds the building.
- Two years’ rent where the landlord or his close family themselves carry on a similar business there.
- Three years’ rent, possibly increased by additional damages, where the landlord, without serious reason, fails to carry out the stated intention within six months and for at least two years.
If the refusal is based on a serious breach by the tenant, no indemnity is in principle due. A refusal is therefore a decision with a price tag, and negotiating before a refusal is often the better course.
Assignment, subletting and alterations
The tenant may in principle carry out alterations that are useful for the business, within the limits set by law and after notifying the landlord in advance.
The contract cannot prohibit an assignment of the lease or a sublease together with the business (handelszaak / fonds de commerce). The landlord may, however, object on serious grounds within thirty days of being served with the draft assignment or sublease; otherwise he is deemed to consent (Article 10). The original tenant remains jointly and severally liable for all obligations under the original lease (Article 11). Apart from a transfer of the business, the contract may exclude or restrict assignment and subletting. When a business is taken over, this is usually where buyers stumble.
Commercial lease disputes: the justice of the peace
Commercial lease disputes fall, regardless of the amount, within the jurisdiction of the justice of the peace for the place where the premises are located (Articles 591, 1° and 629, 1° of the Judicial Code).
Many disputes — about rent review, renewal or the indemnity — lend themselves to an attempt at conciliation, which is faster and cheaper than proceedings on the merits. See also our article on lease disputes before the justice of the peace.
Three dates to put in your diary
- Eighteen months before the end of the lease: from this point, and not before, the renewal request can validly be sent.
- Fifteen months before the end: the final deadline. Do not wait until the last day, and keep proof of sending and of receipt.
- Three months after the request: check whether the landlord has replied. His silence counts as agreement to your conditions if your request was valid — and you must be able to prove it.
Frequently asked questions
How many times can a commercial lease be renewed?
Three times, each time for nine years. Together with the original lease, the relationship can thus last up to thirty-six years.
What if I have missed the fifteen-month deadline?
You can then no longer enforce renewal and you have no claim to an eviction indemnity. You can still negotiate a new agreement, but the landlord is under no obligation to do so.
May the landlord ask for a higher rent on renewal?
Yes, he may propose other conditions in his reply, including a different rent. If the parties cannot agree, the tenant must apply in good time to the justice of the peace, who decides on the conditions.
Commercial lease lawyer in Brussels: Novex Advocaten can help
We draft requests and replies in the statutory form, negotiate the terms of renewal and conduct proceedings before the justice of the peace — for tenants and landlords alike.
Call 0484 99 22 72 or email asfour@novexadvocaten.be.
Sources
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