SLOVENIA Law and Practice Contributed by: Blaž Ogorevc, Miha Štravs and Blaž Murko, Odvetniki Šelih & partnerji, o.p., d.o.o.
agricultural land cannot be less than ten years (or 15 or 25 years for specific types of agricul - tural land). Regulation of rents and lease terms was enacted as a result of the coronavirus pan - demic; however, its validity has since expired. 6.4 Typical Terms of a Lease Length The length of lease term for business premises is typically agreed as a fixed period of between two and ten years (for offices) or between five and 20 (for facility, warehouses and retail). Extension options are also often agreed. In the past, fixed-term leases were far more common in comparison to indefinite lease terms because the latter had to be terminated through court proceedings in accordance with the Business Buildings and Business Premises Act. Although this Act was repealed and (new) indefinite period lease agreements for business premises are no longer required to be terminated through court proceedings, fixed-term lease agreements are still more common. Maintenance and Repair of Real Estate In accordance with the Obligations Code, the landlord must maintain the condition of the sub - ject of the lease during the entire lease term and, if necessary, repair it. The landlord is obliged to reimburse the tenant for maintenance costs incurred by the tenant. However, the costs of minor repairs caused by the normal use of the subject of the lease and the costs of its use are borne by the tenant. Nevertheless, the parties are free to set different terms of lease on main - tenance and repair, and the approach differs depending on the type and scope of lease. In small-scale cases the parties tend to refer to the statutory regulation, whereas, in larger commer - cial leases, the split of maintenance obligations is defined in detail. In triple net leases, which are also common in commercial (specifically
sale and leaseback) transactions, the burden of maintenance and repair is shifted to the tenant. Frequency of Rent Payments Rent is mainly paid on a monthly basis and very seldom quarterly. Different frequencies of rent payments are uncommon. 6.5 Rent Variation In the case of fixed-term leases for a shorter period of time, the rent payable will normally remain the same for the entire duration of the lease term, with the rent being increased, if so agreed between the parties, alongside the pro - longation of the lease term. Conversely, fixed- term leases concluded for longer periods of time commonly include rent variation systems, such as rent indexation, graduated rent or rent linked to turnover. The rise of inflation triggered by the Russia–Ukraine war caused even short- to mid- term leases to contain indexation clauses. Even if inflation is currently not high, this matter is now carefully negotiated across the market. 6.6 Determination of New Rent On the one hand, if the rent is to be changed or increased, the determination of new rent is usually regulated by the lease agreement itself. In the case of rent indexation, the rent will be adjusted according to the changes in the chosen index. For graduated rent, the rent will be raised gradually by a specified amount after a certain period of time. For rent linked to turnover, the rent will be adjusted according to the tenant’s turnover. On the other hand, if the determination of the new rent is not regulated, the new rent is usually negotiated in view of the average market rent applicable to the type of real estate. 6.7 Payment of VAT Generally, VAT is not payable on rent. However, in accordance with the Value Added Tax Act, the
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