Renting properties in Belgium

Seminar British Embassy - 20/09/2007

Benoît KOHL
LL.M. Cambridge
Lecturer University of Liège
Solicitor (Stibbe Brussels)

04/09/2007 p1
Menu
1. Real Estate in Belgium : Bird’s eyes view
2. Residential leases agreements
- Overview of the Act of 1991, as modified by the Act of 2007
- Rules relating to the conclusion of the contract
- Duration – Rules for termination
- Rent – Rent review – Costs (“charges”) related to the property
- Assignment
- Break clauses
- Maintenance Issues

3. Question time / Exercises / Cases

04/09/2007 p2
PART I :

REAL ESTATE IN
BELGIUM :
BIRD’S EYES VIEW

04/09/2007 p3
Where do I find the Law in Belgium
?
- Real estate mainly governed by the Civil Code (« Code
Napoléon » - 1804)
- Other relevant statute law includes:
 Planning law,
 Standards for residential habitability,
 Consumer Act,
 Construction of dwellings Act (« Loi Breyne »)
 Mortgage credit Act
 …

04/09/2007 p4
How to find his way in the Civil
Code ?
- 2280 articles
- Lease contracts (movable &
immovable): articles 1708 ff.
- Contracts for lease of immovable
property : articles 1714 ff.
04/09/2007 p5
PART II :

LEASING RESIDENTIAL
PROPERTY

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1. Introduction – Basis concepts

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Note:
- Articles 1714 to 1762bis : General
provisions for any lease agreement
related to an immovable property

- Three specific Acts governing 3 specific

lease contracts (inserted in the Civil
Code):

04/09/2007 p8
1. The Act of 20 February 1991:
Residential Leasing
2. The Act of 30 April 1951:
Retail trade leasing (direct contact with
customers)
3. The Act of 4 November 1969:
Farms and rural estate leasing

04/09/2007 p9
The Act of 20 February 1991 on
residential leasing : general
comments
- Act aimed at guaranteeing housing security of
tenants in private lettings and minimum quality of
these lettings
- Consequence : All articles of the 1991 Act are
« imperatifs », i.e. no derogation possible by
agreement (by clause in the contract) contrary to the
tenant’s interests.
- Possible however to increase by contract the tenant’s
protection
04/09/2007 p10
- Where the 1991 Act is not applicable OR where
the 1991 Act gives no answer to a specific issue
(for instance: what are the landlord/tenant’s
duties in connection with the maintenance of
the property), THEN back to the general
provisions applicable to any lease contract

- Where these general provisions give no answer

(for instance : do I have the right to suspend the
payment of the rent?), THEN back to the
general contract law.

04/09/2007 p11
When does the 1991 Act apply?

- Need to be a lease
- Need to be the tenant’s main place of
living
- Need to be an individual (not a
company)
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Is the 1991 Act applicable to lease contracts
where the tenant is an Embassy ?

No !!
However it is possible to make the 1991 Act applicable to these
contracts by specific clause to be inserted in the contract.
Advantage : the tenant (i.e. the Embassy) is far more protected.
Drawback : more formalities (ex: registration of the agreement, strict
notice periods to be complied with,…)

04/09/2007 p13
!!! The clause must be explicit.
Example of such a clause:
« Les parties déclarent expressément
soumettre le présent contrat aux dispositions
de la loi du 20 février 1991 sur la bail de
résidence principale (telle que modifiée par
les lois ultérieures), même si le présent
contrat, pour quelque motif que ce soit, ne
rentre normalement pas dans le champ
d’application de cette loi ».
04/09/2007 p14
2. Signing the contract :
NEW RULES
(Act of December 27, 2006
and Act of April 13, 2007)

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a. Public Lease Announcement
Each public lease announcement shall mention
both the rent and the shared costs of the
property. Local authorities of the town
where the property is located may
impose fines up to EUR 200 for
infringements on this obligation.
04/09/2007 p16
In addition, the local authorities may oblige the
landlord to provide them with detailed
information concerning the property at least 14
days prior to the signing of a lease agreement.

If the landlord does not provide this information on

time, a tenant will subsenquentely have the
right to annul the lease agreement by means of
a registered letter to the landlord up to 10 days
after signing of the contract.
04/09/2007 p17
b. Duty to register the lease
agreement
- Previously, any real estate lease, sub-lease or transfer
of lease in Belgium was already (supposed to be)
submitted to registration entailing the payment of a
registration fee. But no sanction for the Landlord

- New rules, however, are now applicable for residential

leases as to deadlines, the persons subject to the
obligation, the amount of fees and penalties.

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- Deadlines : From now on, residential lease agreements
must be submitted for registration within 2 months
(4 months for other lease agreements)

- Person subject to the obligation: Residential lease

agreement must now be registered exclusively by the
Landlord (other lease agreements: Both parties were
jointly held to proceed with the registration – even if
the agreement usually compelled the tenant to do so)

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- Amount of fees: Registration of residential lease
agreement will now be for free

- New civil sanction introduced : any non registered

residential lease agreement may be terminated
by the tenant at any time (i.e. the normal
notice period is 3 months) and without penalty
(i.e. normally a penalty equal to 3, 2 or 1
month’s lease is payable, whether termination
occurs during the 1., 2. or 3. year) !!

04/09/2007 p20
c. Inventory of fixtures (« état des
lieux »)
- Previously, it was not compulsory to provide for an
inventory of the property. In such a case, if no
inventory had been drawn up, the law (civil code –
art. 1731) presumed that the tenant had received the
property in the state where this property was left at
the end of the lease agreement (provision in the
advantage of the tenant) – NB: It is open to the
landlord to try to proof against this presumption.

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- From now on, a detailed inventory of the property
should be drawn up, either before or during the
first month of residence, in the presence of both
the landlord and the tenant.
- This inventory has to be attached to the lease
agreement, and has to be registered together
with the agreement.
- N.B. : 1) this new provision applies for any lease
contract (not only residential lease).
2) No specific sanction if the inventory is not
drawn up (old sanction (presumption) still valid)

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- What if the Landlord refuses to draw
up the inventory ?
→ Can be compelled to do so by the
Judge, who will nominate an expert
(in principle, shared costs).

04/09/2007 p23
d. Instructive document
An instructive document has been developed by means of a
Royal Decree, which has to be attached to the lease
agreement. This document will contain information
relating to the following topics :
(i) legal requirement for a written lease agreement, its registration and the
costs thereof; (ii) regional rules regarding health, safety and fitness for
habitation of places of residence; (iii) rules regarding the duration of a
lease agreement; (iv) the possibilities with respect to the revision of the
lease agreement, the indexation of the rent and the additional costs, the
repair of damages, the termination of the contract and the change of
ownership of the property and (v) information regarding the possibilities
of legal aid in case of a dispute.

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e. Security deposit : new rules
The 2007 Act foresees 3 different ways in which a tenant may provide a
security deposit:
- The tenant may open a personal account in his name: in this
case, the maximum amount of security deposit is 2 months’ rent
- The tenant may provide a bank guarantee: in this case, the
maximum amount of security deposit is 3 months’ rent
- (Other option : in case of financial difficulties, a tenant may ask as Social Service
Department (CPAS) to provide a bank guarantee on his behalf)
In any case, the security deposit may only be used after the termination
of the lease agreement or by court order.

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2. Performance of the Lease
Agreement – Duties of the
parties

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a. Duties of the Landlord
a.1. General Law of Lease contracts
- NB: general lease contract law: it is allowed to deviate by
a specific clause in the agreement
- Duty to deliver properly the property , i.e. remove the
« obstacles de fait ou de droit » that could hinder the
entry in possession
ex: works have to be finished, …
- Duties relating to the maintenance (see later)

04/09/2007 p27
- « Guarantee duty » (« obligation de
garantie »):
- against any (hidden) defects of the good (see
maintenance)

- against any « trouble de jouissance »:

1. caused by the landlord : ex
- landlord hires a caretaker/manager of the building; caretaker’s negligence
that leads to a burglary → builder may be liable for his caretaker’s fault.
- landlord ask a building contractor to do some extensive repair, … ;
excessive noise, dust → landlord must indemnify (even if the purpose is to
increase the comfort of the property : ex. : installation of a lift, modification of
central warming system (if this results in works, or increase of costs for the
tenant). However, must be admitted by the tenant any minor works (ex: new
door, installation of individual electricity meters,…)
04/09/2007 p28
- one tenant does not pay the water/electricity costs and the landlord stops
to provide water/electricity for the entire building : not allowed

- landlord can not transform the real property until the end of the lease
agreement (but for with the tenant’s agreement).

- landlord can not decrease the level of comfort existing at the beginning
of the lease agreement (ex: suppression of parking places, suppression of
the garden, suppression of the caretaker (if agreed),…)

- It is allowed for the landlord to do any urgent repairs , even without the
tenant’s agreement: for these works, the tenant will not have indemnity if
the duration of the works is less than 40 days (art. 1724 Civil Code)

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- IN NO CASE, the Landlord can enter in the property without the
tenant’s agreement (even for repairs, visits before the end to the lease
agreement (with potential new tenants); If the tenant refuses the access
without legitimate motif → ask authorization to the Judge.
- contracts with to 2 tenants at the same time
- landlord contracts with a tenant which is a competitor of the tenant of his
neighboring flat

2. Caused by 1/3 parties: ex:

- A third party pretends to have a right on the property –

- !! Not for third parties’ “troubles de jouissance”. (Ex: noisy neighbor,

neighbor’s dog,…) : the tenant must react himself.

04/09/2007 p30
a.2. Landord’s specific duties with respect to
residential lease
Specific duty: the landlord is responsible for the upkeep of the
property, in order for the property to meet the standards for
residential habitability (defined by law – Royal Decree 8 July
1997 - !! the policy of setting the standards for habitability is
partially in hands of the « Régions » - ie Flanders, Walloon
Region and Brussels)

Indeed, other leases often imposes to the tenant to bear some of the
obligations to upkeep the property (with the exclusion of
works which relate to the soundness of the property)
See also later (maintenance)

04/09/2007 p31
What are these standards of habitability ?
- Size of the place of living : at least one privative
“living place” (bathrooms, toilets, corridors, … may
be common to several privates places of living)
- No defects that can have an negative impact on
health or safety (ex: high level of humidity (but not
if the humidity is caused by the tenant’s behavior))
- “Natural light”: all places of living and bedrooms
must have a source of natural light (size: at least 1/12
of the roof size) + aeration in bathrooms,… (size : at
least 0,1 % of roof size)

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- Minimal equipment : point of potable water
(warm water not required); private wc (or 1
common wc for 5 persons), minimal electrical
system, …
- Possibility to lock the property
- …
→ Minimal requirements (“minimal human
dignity”)

04/09/2007 p33
 + REGIONAL RULES

- RENT PERMIT to be obtained by the Landlors

- Conditions for obtaining the permit may differ from one
Region to another (ex: Need to obtain the attest from the Fire
Inspection Dept.);
- For different kind of properties :
- all properties in Flanders (but is not required: only helps the Landlord to proof
that his property meets the health and safety conditions),
- only small size properties (living space < 28m² and student rooms) in the
Walloon Region and Brussels (not possible to rent such properties without
permit)
- Sanction if no permit : contract might be void.
- Other Regional rules (ex.: Fire detector (new rule in Walloon
Region since Decree 21/10/2004))

04/09/2007 p34
b. Duties of the Tenant
1. To pay the rent (!)
- Indexation clause (mandatory formula):
basis rent x new index
basis index
N.B: - index = published in the official Gazette (Moniteur belge), by
minister of Economy
- what if landlord forgets to adapt (limitation of action: 1 year)?

04/09/2007 p35
- Specific rules for residential lease
(1991 Act):
NO INCREASE of the RENT possible UNLESS
a. indexation possible even if nothing is provided in the
agreement (exception: if the agreement expressly prohibits the
indexation); BUT the landlord must ask it expressly (by letter),
maximum once a year. If the landlord forgets the anniversary
date of the agreement, he can ask the indexation later, but there
will be no indexation accepted for the previous month’s rent
(with exception for the last 3 month’s rent before the date of
the landlord’s letter, on which indexation will be due)

04/09/2007 p36
b. when the judge accepts a prorogation of the agreement in case of
exceptional circumstances, he may accept an increase of the rent if
it is fair.
c. possible to increase the rent every 3 years
- c.1) by agreement between the parties (but only between the 9th
and the 6th month before the end of each 3 years-period – if not
between these dates, parties are free to considered no to be bound
by the agreement on the increase (or decrease) of the rent)
- c.2) in execution of a court’s decision (ex: in case of new
circumstances, if increase of the « normal rent value » of the
property of more than 20 % / or in case of works performed on the
property which increase the value of the property of more than 10
%)

04/09/2007 p37
2. To pay the « charges ».
- lump sum or effective charges (choice of parties)
- separate calculation (therefore, no indexation
possible for the charges);
- the landlord is under a duty to produce documents
proving the effective costs (rule not applicable in the
case of a lump sum).

04/09/2007 p38
- in the case of a flat in a building with multiple flats where a
« syndic » has been nominated, the landlord’s duty is simplified
(not necessary to send documents proving the effective costs –
summary is enough + possibility for the tenant to consult the
documents at the syndic’s office)

- specific rule for residential leases:

1. The annual real estate tax (precompte immobilier) can not be
paid by the tenant (ie cannot be included within the « charges »)
2. Reminding : 2007 Act : Each public lease announcement (only
for residential lease) shall mention both the rent and the shared
costs of the property. Local authorities of the town where the
property is located may impose fines up to EUR 200 for
infringements on this obligation.
04/09/2007 p39
3. Duty to use the property as a « bonus pater
familias » (idea of good faith).
examples:
- prohibition to have activities that deteriorate the property (of course !)
ex: - no occupation of the property, without care for aeration,
warming, surveillance,…
- dangerous (or dirty) animals,…
- no care of the garden
- duty to warn the landlord if his intervention (urgent repairs, ..) is needed
- prohibition to modify the property (save little « aménagements » that do
not properly modify the property : ex: painting, wallpaper,
bathroom/kitchen’s accessories…)

4. Duty to maintain the property (see later)

04/09/2007 p40
4. Duty to furnish the property
- this provides a guarantee for the landlord
- exception for property leased with furniture

5. At the end of the agreement, duty to restore

the property in its previous state
- utility of the inventory (« état des lieux »), from now on, in principle
compulsory (2007 Act)
- see above : proof of the state of the property / presumption when no
inventory has been drafted

04/09/2007 p41
-Costs of the inventory : shared between parties
- Disagreement : the judge can nominate a judicial
expert whose inventory will be binding for both
parties.
-Special issue in case of fire: the tenant is presumed
to be liable, save as he can prove that the fire was not
his fault

04/09/2007 p42
3. Consequences of non
performance of duties / garanties

04/09/2007 p43
- Maintenance, repairs, defect guarantees :
see later
- !! Specific protection: « exception
d’inexéctuion » : right to suspend your
duties if the other party is in fault
- ex : right to suspend the payment of the price
if landlord does not maintain
conditions: good faith (not suspend the total
rent if minor maintenance’s problem)

04/09/2007 p44
- If one party fails « seriously » to perform his duties
(landlord : provide the property, maintain, ../ tenant :
pay the price, maintain,...), the other one may ask the
judge for the « resolution » of the agreement +
indemnities.
- ! Necessary to go to court the ask for the resolution
(never automatic in lease contract law).
- NB: Frequent penalty clause (« clause pénale ») : if
tenant does not pay the rent, he is liable to pay interest
- NB: Possible for the parties to increase/decrease their
legal duties (save for the matters regulated by the 1991
Act) ex: possible to make the tenant responsible for all
the repairs – see later.

04/09/2007 p45
4. Term of the residential lease
agreements

04/09/2007 p46
- If the lease does not fall within the scope of
the 1991 Act : parties are free to agree on
the term (ex: 1 month, 1 year, 3-6-9
years,…): the contract may provide for a
notice, or may exclude it.
- If the residential lease falls in the scope of
the 1991 Act : Extremely complex
regime :
04/09/2007 p47
1. Principle : 9 years
2. Main exception : short term lease (3
years max.)
! : short term lease may be renewed only 1 time with the
total duration being no longer than 3 years (2nd
renewal = automatically becomes a 9 years lease)
! : Notice of leave at least 3 months before the expiration
date of the lease (if not : automatically becomes a 9
years lease)

04/09/2007 p48
3. Possibilities to put an end at the lease agreement
(without other party’s fault)
- End by the landlord : only:
- a: for personal occupation of the property (at any time,
with 6 months notice; NB: the landlord must really occupy
the property: if not, he must pay an indemnity = to 18
months rent)
- b: for heavy works to be carried on in the property (only
at the end of year 3, 6 and 9 – with 6 months notice ; NB
landlord must really perform the works announced: if not,
indemnity = to 18 months rent)
- c: without any reason (only at the end of year 3, 6 and 9
– with 6 months notice + indemnity of 6 or 3 months rent)
04/09/2007 p49
- End by the tenant:
- At any time, with 3 months notice
- + indemnity if he leaves the 1, 2 or 3 year
( indemnity of 3 , 2 or 1 months rent)

- + « contre-preavis » (if the landlord puts an

end to the agreement – with 6 months notice - ,
the tenant may abbreviate this notice by giving
a 1 month notice to the Landlord) (ex: if he has
found another property in the meantime).

04/09/2007 p50
- consequence : lease agreement does not
automatically expires on year 3, 6 or 9
- NB : If the tenant stays in the property
after year 9, automatic renewal for a new
3-6-9 lease agreement
- NB: In any circumstance of resiliation
by the Landlord, the Tenant may ask the
Court for a extension of time of the lease
agreement (« prorogation »), in the case
of exceptional circumstances
04/09/2007 p51
- examples of exceptional circumstances
- Pregnancy of recent chirurgical operation
- Age of the Tenant (90-95 years old,..)
- Delay in the construction of the Tenant’s new house
- But not :
- Delay in the construction of the Tenant’s new house,
caused by Tenant’s fault
- Medical situation of Tenant, but not “exceptional”
- Difficulty to find a new property to rent (not
“exceptional”)
- …

04/09/2007 p52
5. Assignment of the contract –
Sub-lease agreements
1. Assignment to another tenant : only
with the Landlord’s agreement (the
tenant is « released » - no duty to
pay the rent, to maintain…)

04/09/2007 p53
2. Sub-Lease Agreements:
- Only for a part of the real property
- Only with Landlord’s agreement
- Terms of lease and sub-lease must be the
same
- The Tenant stays liable towards the
Landlord for the entire real property (no
direct relationships between landlord and
sub-tenant)

04/09/2007 p54
6. Sale of the real property which is
occupied by the tenant.
If the lease agreement has been registered (see
above 2007 Act): the new Landlord is
bound by the lease agreement

If not : new landlord can put an end to the lease agreement (with 3 months notice if
the Tenant has been living in the property for at least 6 months)

04/09/2007 p55
7. End of the Lease Agreement:
summary
- Mutual agreement between the parties (always
possible)
- Resolution because of the other party’s fault
(landlord does not maintain, tenant does not
pay,…)…
- Each party can put an end, but following the
rules regarding notice periods, indemnities,…

04/09/2007 p56
8. In case of disagreement…
- Local judge (« juge de paix ») has
exclusive jurisdiction to deal with all
aspects of lease contracts’ claims.
- Not compulsory, but strongly
advisable to be advised by a lawyer.
04/09/2007 p57
PART III:

MAINTAINING
RESIDENTIAL PROPERTY

04/09/2007 p58
1. Basic principles
- Difference to made between :
- Situation of the property at the beginning of
the lease contract: only Landlord’s liability
- Duty to maintain the property during the lease
contract: both parties may be liable with
respect to maintaining the property
04/09/2007 p59
2. At the beginning of the lease
contract

04/09/2007 p60
REMEMBER
The Landlord must “only” provide for a
property that meets the minimal standards
for residential habitability.
Initially, these minimum standards were mentioned
in the Royal Decree of 8 July 1997
Since then, the three Regions have received
jurisdiction on habitability matters (mainly to
precise or to add some standards to the
minimum federal standards – see also the
requirement to obtain a rent permit)
04/09/2007 p61
!!! All These « standards » of habitability
are minimal ones (minimum of
habitability.
See examples above.
By Contract, parties may increase these
standards (Remember: “état des lieux”)

04/09/2007 p62
Remember (2007 Act) :
- From now on, a detailed inventory of the property
should be drawn up, either before or during
the first month of residence, in the presence of
both the landlord and the tenant.
- This inventory has to be attached to the lease
agreement, and has to be registered together
with the agreement
- Instructive document to be annexed to the contract :
regional rules regarding health, safety and fitness for
habitation of places of residence

04/09/2007 p63
3. Maintenance during the
lease of the property

04/09/2007 p64
- State of the Law before the 2007 Act:
1. The Landlord is responsible for the « réparations
nécessaires » (necessary repairs, i.e. necessary to let the Tenant
use the property in conformity with the contract terms)
2. The Tenant is responsible for the « réparation locatives »
(lease repairs, i.e. repairs which result from the normal use of
the property)
3. BUT SUPPLETIVE LAW: possible (and very frequent) to
increase by contract the Tenant’s duties (but for the Landlord’s
responsibility for the upkeep of the property, in order for the
property to meet the standards for residential habitability)

04/09/2007 p65
- Modifications since 2007 Act
The distinction between « réparations
nécessaires » and « réparations
locatives » is from now on imperative:
impossible to increase the tenant’s
duties and to make him responsible for
some or all of the réparation
nécessaires.
04/09/2007 p66
- A Royal Decree will soon be
published with a list of the
« réparations nécessaires » (ie
Landlord’s repairs)
not yet published…

04/09/2007 p67
Examples of « réparations »
a. « Réparations nécessaires » (Landlord’s
duty)
- Ex: Humidity
- Ex: Central warming system deficient (or very old)
- Ex: Windows broken due to “unknown” reason (ex: weather,
malevolent act,…)
- Ex: Roofs, walls, gutters, water pipes, electric cables, lifts, …
(repair or maintenance)

04/09/2007 p68
BUT NOT:
- if the repair is caused by the Tenant’s fault
- Sumptuous works (ex: Landlord can not be asked to
replace an “Ikea kitchen” by a “3 stars kitchen”)
- Entire reconstruction (ex: following fire)
Remember:
- Tenant’s duty to warn the Landlord if urgent repairs
are required
- If repairs for more than 40 days, indemnity for Tenant

04/09/2007 p69
b. « Réparations locatives » (Tenant’s duty)
- Ex. Annual chimney sweeping
- Ex. Maintenance of the Alarm system
- Ex. Maintenance of the boiler
- Ex. Repairs to doors, locks,…
- Ex. Repairs to windows
- Ex. Painting of the walls
- Ex. Garden
- Ex. Replacement of washers (of taps), joints,…
- …

04/09/2007 p70
QUESTION TIME

04/09/2007 p71
 THANK YOU

Benoît KOHL
LL.M. Cambridge
University of Liège
Solicitor (Stibbe Brussels)

04/09/2007 p72