BELGIUM Law and Practice Contributed by: Pieter Puelinckx, Yves Moreau, Melissa Verplancke and Gauthier Callens, Linklaters
conditions (including rent), usually guided by the parties’ arguments and independent valuations. Additionally, at the end of every three-year peri - od, either party can seek before the courts a rent review if the property’s rental value has shifted by at least 15% from the current rent due to new circumstances. 6.7 Payment of VAT Payment of VAT The leasing of immovable property is usually a VAT-exempt activity, unless the VAT option pro - vided in the VAT Code is applied, which is sub - ject to the following conditions (amongst others): • the building must be used for the economic activity of the tenant; • the leased premises are (parts of) a new/ substantially renovated building (ie, buildings for which VAT on construction or refurbish - ment cost became due for the first time on 1 October 2018 at the earliest); and • the option will apply for the entire duration of the lease. However, leases for specific properties such as parking spaces and storage units generally incur VAT, but exemptions may apply. Additionally, VAT also applies to short-term leases under six months (with exceptions, eg, residential leases) and to other arrangements such as hotel accom - modation or “service/business centre” which include services (cleaning, maintenance, furni - ture, printers, meeting rooms, etc) in addition to premises made available (such as offices). 6.8 Costs Payable by a Tenant at the Start of a Lease Inventory of fixture – if both parties decide to appoint a professional, such as a land surveyor, to draft an inventory of fixtures, the costs thereof
are usually split equally. Alternatively, each party may hire their own expert to collaborate on the inventory of fixture. Insurance – tenants are usually required to have insurance to cover risks such as fire and water damage as well as their fit-out works. Landlords sometimes also require additional risk coverage from the tenant (such as operational losses). Registration duties – at the start of the lease, the tenant is usually required to pay the registration duties of the lease. Entry fee – in the context of retail leases, an entry fee is sometimes contractually agreed between the tenant and the landlord (or between the transferee and transferor of a lease). Guarantee – see 6.4 Typical Terms of a Lease . 6.9 Payment of Maintenance and Repair Retail and common law leases usually assign maintenance and repair costs to the tenant, except for major repairs. In multi-tenants proper - ties, the landlord usually enters into maintenance and repair agreements for the common areas, which are re-invoiced to the tenants in propor - tion to their occupied space. 6.10 Payment of Utilities and Telecommunications Tenants are usually responsible for arranging their own connections to utilities and commu - nication services. 6.11 Insurance Issues Even if there is, in general, no statutory obliga - tion to take out insurance, two types of insur - ance are usually required in lease agreements.
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