LITHUANIA Law and Practice Contributed by: Evaldas Klimas and Mantas Lideika, WALLESS
are not obligatory, but are voluntarily applied by the largest players in the market. There are no material ongoing regulations regarding rents or lease terms that resulted from the COVID-19 pandemic. The pandemic did not have a substantial effect on existing leases, and deals continued to be made between landlords and tenants regarding payments for leased premises during the pandemic. Due to trends in the lease market, the leasing of residential and/ or office buildings is still booming. 6.4 Typical Terms of a Lease The typical terms of a lease of business prem - ises are outlined below. • The maximum term of any lease may not exceed 100 years. • The tenant is usually responsible for daily maintenance and current repairs of the leased property, and the landlord is responsible for capital repairs of the property. • The rent payment is typically paid every month for the upcoming month in advance. • Pandemic issues are usually solved through standard lease provisions of force majeure, inability to use the premises, etc. Usually, the tenant and the landlord agree on some rent discount or delay of payments. So far, there have been no marked standard lease conditions aimed at pandemic issues, and the parties are free to negotiate any such specific condition. The market does not usually use specific clauses that would deal with con - struction build-out/supply chain issues due to the pandemic. 6.5 Rent Variation The rent payable is usually reviewed and indexed (increased) every year according to the index
chosen by the parties. The Lithuanian consumer price index (CPI) or the Lithuanian CPI harmo - nised under the methodology applied across other European Union member states (Harmo - nized Index of Consumer Prices, HICP) are used in most commercial leases. 6.6 Determination of New Rent As mentioned in 6.5 Rent Variation , the rent is typically increased each year as a result of indexation. No additional consent for any such increase is usually required from the tenant. If either party wishes to change or increase the rent, it must follow specific procedures and rules established in the lease agreement. In the event of the absence of any such procedure and con - sent from the other party, the rent may only be changed or increased through court proceed - ings. 6.7 Payment of VAT VAT is payable on rent. It is not applicable in certain cases related to general tax regulations (eg, a foreign tenant who is not registered as a VAT payer). 6.8 Costs Payable by a Tenant at the Start of a Lease In addition to the payment of rent, the tenant typically covers the costs for communal services rendered in the premises as well as operational fees intended to cover maintenance, repairs, management, insurance of the building, real estate, land tax and related costs. Operation fees are typically calculated in proportion to the size of the area occupied by the tenant. 6.9 Payment of Maintenance and Repair The costs for the maintenance and repair of areas used by several tenants – eg, parking lots and gardens – are usually shared by all the ten -
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