66 | Investor Guide to Europe 2014
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negotiations
•
An investment memorandum may be prepared by the seller/
agent providing some general details on the property. As a
preliminary step, a non-disclosure agreement is then often
proposed by the seller/agent in order to allow access to the
property and further information and documentation. The
would-be purchaser may issues a letter of intent which may
include certain preliminary terms and conditions as well as
an exclusivity period. The letter of intent and non-disclosure
agreement may be combined in one and the same document.
Discussions are usually pursued on the basis of this letter of
intent providing for an exclusivity period during which the due
diligence exercise is carried-out.
•
The concept of pre-contractual good faith should be conside-
red entering into negotiations.
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Sale and Purchase agreement
•
Contains terms and conditions for the sale and purchase (e.g.
price, warranties, guarantees and limitation of liability). The
actual transfer, however, is not effectuated until a Deed of
Transfer is executed and registered with the Land Registry (see
below). This deed will only be executed after all conditions for
the transfer of ownership included in the Sale and Purchase
Agreement have been waived or are fulfilled.
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Deed of transfer
•
The deed that will be registered with the Land Registry pur-
suant to which the ownership of the property is transferred
from the seller to the buyer. The Deed of Transfer is execu-
ted in the Dutch language in front of a civil-law notary in the
Netherlands. The civil-law notary is responsible for registering
the deed with the Land Registry. A Dutch civil-law notary is a
qualified lawyer (often associated with a law firm) and usually
also involved with the drafting of the Sale and Purchase Agree-
ment (which agreement may be drafted in e.g. German, English
or any other language).
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Combined sales and building contract
(koop-
aanneemovereenkomst)
•
Used for selling buildings that have not yet been constructed.
The seller is committed to erect the property in accordance
with agreed specifications, price and deadline; the seller pro-
vides the purchaser with completion and defects guarantees.
The purchaser pays the purchase price gradually along the
construction steps until completion.
CoMMERCIaL LEaSES
TYPES of CoMMERCIaL LEaSES
Generally speaking, leases of buildings used for commercial
purposes can be divided into (i)
Commercial retail premises
(e.g.
stores, restaurants, hotels, cafés, take-away services); or (ii)
other
commercial premises
(e.g. offices, industrial sites and ware-
houses). The applicable category is determined by the intended
primary use of the property. Lease agreements for commercial
retail property are subject to semi-mandatory provisions, which
offer the tenant a considerable degree of legal protection regar-
ding – amongst other things – the duration and termination of
the lease and the rent level. For the category ‘other commercial
property’ there are no mandatory minimum terms, no mandatory
notice periods and no rent regulations. However, there are certain
mandatory provisions relating to eviction protection (
ontruimings-
bescherming
) at the end of the lease term.
Commercial retail premises
•
The statutory provisions are intended to provide a certain
extent of security of tenure for two terms of five years. When
the tenant gives notice of termination of the lease at the expiry
date of a lease period, the lease will end automatically. Howe-
ver, if the landlord gives notice of termination, the lease will
continue until the competent court has terminated the lease
(unless of course the tenant agrees to termination). There are
limited statutory grounds for the landlord for terminating the
lease. The notification period must be at least one year.
•
The tenant who wants to sell and transfer its business will have
to seek permission of the landlord to also transfer the lease.
If the landlord does not grant permission, the tenant can ask
the court to make the purchaser of its commercial business
the new tenant. The court can only grant permission (i) if the
tenant has a serious interest by selling its commercial business,
and (ii) if the prospective tenant does offer sufficient security
for the fulfillment of its obligations under the lease.
•
If the current rent does not correspond with the rent of com-
parable leased properties in the area, the tenant and/or the
landlord may periodically request the court to determine the
rent. Such a request may be made at the end of a lease term,
or every five years. A market rent review may also lead to a
lower rent.
•
The parties to a lease agreement for commercial retail pre-
mises may ask the court to approve contractual provisions
that deviate from the abovementioned mandatory provisions.
Deviations that are not approved by the court are subject to
annulment by the tenant.
other commercial premises
•
No mandatory minimum terms, no mandatory notice periods,
no rent regulations, no assignment of lease regulations. This
category of leases terminate by expiry of the agreed term or, if
no term has been agreed, by termination by one of the parties.
In order to oblige the tenant to vacate the leased property,
the landlord must give a notice of eviction. The obligation to
evict is subsequently suspended for two months by law as of
the date of eviction stated in the notice of eviction. A tenant
is not entitled to a suspension of eviction if the tenant has
given notice of termination of its own accord, or if the tenant
has expressly agreed to termination. Within the abovementio-
ned two month period, the tenant may request the courts to
extend the suspension term. The court can extend the suspen-
sion term to a period of one year, and the tenant may repeat
this request for extensions of the suspension term two more
times. A request for extension of the suspension term is judged
by weighing of interest.
