MONTENEGRO Law and Practice Contributed by: Milan Keker, Aleksandra Bujkovic, Ivan Pejovic and Iva Rolovic, Keker, Bujkovic & Pejovic
6.3 Regulation of Rents or Lease Terms Rents and lease terms are generally subject to free negotiation between the contracting parties. The Law on Obligations governs lease agreements and pro - vides the general legal framework without prescribing mandatory rent limits or fixed lease durations. Parties are free to agree on the rent amount, lease period, renewal conditions and other contractual terms. How - ever, this freedom is subject to mandatory legal rules that aim to protect the fairness and integrity of the lease agreement. For example, the law sets manda - tory minimum standards regarding the form of the contract, notice periods, and the conditions for ter - minating or renewing a lease. 6.4 Typical Terms of a Lease Length of Lease Term Lease terms for business premises in Montenegro are not strictly regulated and are determined by agree - ment between the parties. Common durations range from two to ten years for office space and five to 20 years for industrial, warehouse or retail facilities, often with renewal or extension options included. Maintenance and Repair of the Real Estate Occupied by the Tenant Unless otherwise agreed, the tenant is responsible for routine maintenance of the leased business premises, including tasks such as cleaning, painting, and minor repairs to installations, as well as paying fees for shared building services. The landlord remains responsible for investment maintenance, which involves major repairs necessary to preserve the structure and functionality of the property or improve its efficiency. If the tenant covers costs that fall under the landlord’s obligations, the landlord must reimburse them. Frequency of Rent Payments Unless otherwise agreed, rent is payable semi-annual - ly for leases of one year or more, and at the end of the term for shorter leases. In practice, however, monthly rent payments are most common, while quarterly or other payment intervals are rare but may be contrac - tually arranged. 6.5 Rent Variation For fixed-term leases of shorter duration, the rent typi - cally remains unchanged throughout the lease term.
capital of EUR25,000, in accordance with applicable regulations. 5.5 Applicable Governance Requirements While there are no special governance rules specifi - cally for real estate investment entities, all companies must comply with general corporate governance prin - ciples under Montenegrin Company Law, including prudent management, proper registration and finan - cial reporting. 5.6 Annual Entity Maintenance and Accounting Compliance Annual entity maintenance and accounting compli - ance costs vary primarily based on the type of entity and the nature of the underlying real estate invest - ments. As such, these costs cannot be reliably esti - mated on a general basis. 6. Commercial Leases 6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time The most common legal arrangement that permits an individual, company or other entity to occupy real estate for a defined period without acquiring owner - ship is a lease agreement. Similar rights of use may also be granted through personal easements – such as usufruct, right of use or residential easement. 6.2 Types of Commercial Leases Commercial lease agreements can cover various types of real estate, including land parcels, commer - cial spaces (office space, retail store, warehouse, etc), industrial facilities or agricultural land. The legal framework governing commercial leases is primarily established by the Law on Obligations, which outlines general provisions applicable to all lease agreements, including specific/supplemental provisions for business premises. Beyond this general legislation, specific laws regulate the lease of certain types of properties – particularly those involving state- owned or agricultural lands.
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