Businesses: Emergency Relief Rent Bill

Costa Rican businessmen support a bill that seeks to modify or suspend payment methods and other contractual conditions of leases in cases of force majeure, such as the current health emergency.

Friday, March 27, 2020

In the context of the propagation of covid-19, the Costa Rican Chamber of Commerce (CCCR) sees with total positivism the plan of relief in the leases, as much for the families, as for the commercial activity, proposal made by the deputy Pedro Muñoz in the Project, file No. 21.851, reason why we requested to be convoked in extraordinary sessions for its discussion.

See "Post-Quarantine Consumption Patterns"

From the CCCR statement:

March 27, 2020. In view of the complex situation we are experiencing in order to face the COVID-19 pandemic, the Costa Rican Chamber of Commerce calls on the Members of Parliament to seek agreements on the costs of commercial rentals.

This has been a hard year in which, despite the fact that we are the sector that generates the most employment in the country with 343,000 workers, representing 16% of the total workforce, we have faced a loss of 24,000 jobs in this last year and, specifically in this situation, 7,980 businesses have been closed and 109,000 people have been dismissed.

From our sector, we see with total positivism the plan of relief in the leases, as much for the families, and for the commercial activity, proposal made by the deputy Pedro Muñoz in the Project, file No. 21,851, "Law to modify or to suspend the forms of payment and other contractual conditions in events of force majeure"; reason why we requested to be convoked in extraordinary sessions for its discussion.

"We are aware that the measures to be applied cannot be the same for those who pay rent on their homes as for those of us who pay commercial rent. The impact on our commercial sector will be for many months, since our economy will be affected by a period that far exceeds this initial period of 3 months," said Julio Castilla, President of the Costa Rican Chamber of Commerce.

In this situation, a bill is needed that allows for a renegotiation (or in its absence, a termination, without penalties), that allows for a frank dialogue in order to move forward and protect as many jobs in national companies as possible.
"From our sector we urge on the importance of incorporating the power so that the businesses can negotiate the contracts in the conditions that both parts agree.

The spirit that should prevail in these negotiations is that both sectors, trade, as well as the owners of the premises, minimize losses," said Castilla.
In the event that no agreement is reached before April 30, it could be authorized to cancel the contracts without penalty clause, protected to an environment of force majeure.

We understand that this situation is urgent and that to the extent that we seek serious solutions and palliative actions, temporary, to safeguard the employment of Costa Ricans, we will be addressing this emergency in the most sustainable way.
Covid-19: How are the outlook changing for businesses in the commercial sector in Costa Rica?

We prepared for our clients the report "Information System: Impact Analysis of Covid-19 on Business" that answers these and other questions in times of uncertainty.

Click here to request access to this report.

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