MALTA Law and Practice Contributed by: Damien Degiorgio and Ramona Galea, Fenech Farrugia Fiott Legal
• easements; • use; and • commodatum. Details of these rights are outlined at 2.1 Cat- egories of Property Rights . 6.2 Types of Commercial Leases Maltese law provides that any property which is not used for residential purposes can be identi - fied as commercial property and therefore shall be subject to a commercial lease. This therefore includes properties utilised as a store, proper - ties used for the sale of art or trade, or, simply, a property from which a business can be car - ried out. It should be noted that, by way of an exception, a property leased to a musical, phil - anthropic, sporting or political party, and which is utilised as a club, is not deemed to be a com - mercial property, even where such property gen - erates business. Apart from the above, the law only distinguishes between those commercial leases entered into pre-1995 and those entered into post-2010: this is to determine the amount of rent payable by the tenant. In terms of any other commercial leases that may be entered into following 2010, the law does not differentiate between different types of commercial leases. 6.3 Regulation of Rents or Lease Terms Commercial lease terms are freely negotiable and are regulated by the applicable provisions regulating leases within the Civil Code. Currently, there is no ongoing regulation of lease terms that has been enacted due to the coronavirus pan - demic. 6.4 Typical Terms of a Lease The typical terms found in commercial lease agreements depend on various factors related
to the property subject to the lease, particularly the type of property, the intended purpose of the property and especially the sector in which the lessee operates, amongst other factors. 6.5 Rent Variation The variation of rent throughout the period of the commercial lease is determined between the parties during negotiations of the lease agreement. This is not regulated by law unless the commercial lease in question refers to one entered into pre-1995 and is considered as a Any change or increase in the rent payable must be agreed between the parties and included within the lease agreement unless the parties are open to entering into an addendum to the lease agreement. In any case, such change or increase is not regulated by law. 6.7 Payment of VAT The VAT payable on rent for commercial leases is 18%. 6.8 Costs Payable by a Tenant at the Start of a Lease protected lease until the year 2028. 6.6 Determination of New Rent It is normal practice for the parties to a lease agreement to agree to payment of a deposit by the lessee and also the requirement of an ade - quate insurance policy, which will cover damage that may be caused to the property during the course of the lease. 6.9 Payment of Maintenance and Repair Expenses relating to the maintenance and repair of areas within the property are shared amongst co-tenants. Each tenant has the right to compel others to pay for the proper upkeep of the prop - erty and the necessary preservation thereof.
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