Due to the COVID 19 pandemic (hereafter, “COVID-19”), the closure of numerous shops and other businesses has been ordered by the authorities. Other shops and businesses are suffering losses in sales, some of them severe. As a result, many tenants will find themselves in an economic predicament and will be unable to pay their rent, at least temporarily. The question has therefore already been raised several times as to whether tenants are still obliged to pay rent during the current situation.

New Law to Encourage Informal Restructuring

On 28 March 2017, the Federal Government released its long awaited draft legislation that is designed to encourage restructuring of distressed businesses.

The proposed legislation is open for consultation with the finalised legislation expected to come into effect on 1 January 2018. There are two proposed changes: