MOROCCO Law and Practice Contributed by: Loris Marghieri, Dounia El Aissaoui and Julien Nouchi, Gide Loyrette Nouel
6.3 Regulation of Rents or Lease Terms Although permitted by law, variable rents are not common in leases for office premises, but are a common feature in retail leases for premium international brands (expressed as a percent - age of the annual gross revenues of the tenant’s business, subject to a specified minimum fixed rent). 6.4 Typical Terms of a Lease Duration As the duration of commercial leases is not regu - lated by Moroccan Law, the parties are free to enter into a lease agreement for any amount of time. In practice, commercial leases are often entered into for an initial period of three to nine years. One of the main features of a commercial lease is the tenant’s right to freely transfer and renew the lease, which means that in the event of non- renewal, the tenant is entitled to eviction com - pensation based, among other things, on the value of the business. To benefit from this right of renewal, the tenant must occupy the prem - ises for two consecutive years or have paid “key money” ( pas-de-porte ) in order to be entitled to such a right of renewal. Please note that in the event the duration of a lease is equal to or over ten years, it is likely that the tax administration (when registering the lease) will consider that the applicable rate and taxable basis of the registration duties is the one that applies to long-term leases ( bail emphytéo- tique ) – ie, a 6% rate on a taxable basis of 20 times the annual rent in accordance with Arti - cle 131 19° of the Moroccan Tax Code (MTC) (against a fixed fee of MAD200 for the registra - tion of a “standard” lease agreement).
• premises or buildings regarded as an acces - sory to the main premises in which the busi - ness is operated; • premises consisting of undeveloped lands that will be developed and used to operate a business; • premises or buildings used for commercial, industrial and handicraft purposes and as part of the private state domain; and • premises and buildings used as private schools, clinics or pharmaceutical laborato - ries. Pursuant to Law No 49-16, some premises may not be subject to a commercial lease arrange - ment, including: • premises or buildings that are part of the pub - lic state domain; • premises or buildings that form part of the private state domain but are used for public interest; • premises or buildings incorporated in a habous; • premises or buildings rented following a court order; • premises or buildings located in a shopping mall; and • premises or buildings located in a dedicated zone gathering companies operating informa - tion technology, industrial or offshore activi - ties. The right of the tenant to renew the lease is one of the main features of a commercial lease. Hence, if the landlord decides to terminate the lease ahead of the agreed contractual term, the tenant is entitled to seek compensation ( indemnité d’éviction ), determined by taking into account the value of the considered business.
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