25 August 2020
The Ministry of Law has put in place a new rental relief framework for eligible small and medium enterprises (“SMEs”) and non-profit organisations (“NPOs”) under which these entities may receive up to a total of four months’ rental waiver for commercial properties, and up to a total of two months’ rental waiver for industrial and office properties. The rental relief framework takes effect from 31 July 2020.
Also taking effect from 31 July 2020 is relief for tenants that were unable to vacate business premises due to Covid-19 and a cap on late payment interest and charges to an amount equal to 5% per annum of simple interest on the arrears for specified contracts.
These relief measures are implemented by way of amendments to the Covid-19 (Temporary Measures) Act 2020 and related regulations.
This article provides an overview of the following changes:
- New rental relief framework for eligible SMEs and NPOs:
- Rental waiver of up to four months for commercial properties and two months for industrial and office properties, provided by Government and landlords;
- Rental waivers apply once IRAS issues notice of cash grant;
- Moratorium on enforcement actions in force until issue of notices of cash grant or 31 December 2020 if notices not received before then;
- Landlords may apply to reduce amount of additional rental relief they have to provide;
- Eligible landlords may apply for rental relief assessor to determine specified disputes;
- Tenants that qualify for additional rental relief may elect to serve notice on their landlords to take up repayment scheme for a specified portion of rental arrears.
- Relief for tenants not able to vacate business premises and cap on late payment interest and charges:
- Tenants not able to vacate business premises due to Covid-19 will not be liable to landlords for failing to vacate the property, except as otherwise provided;
- Late payment interest and charges will be capped at an amount equal to 5% per annum of simple interest on the arrears for specified contracts.
To read the article, please click here.
In addition, we have a cross-disciplinary Covid-19 Legal Task Force consisting of Partners across various practice areas to provide rapid assistance. Should you have any queries, please do not hesitate to get in touch with us at email@example.com.