Legal Update

In March 2013 the Russian Supreme Commercial Court published
Ruling № 13 dated 25.01.2013 that simplify lease relations with regard to newly constructed buildings:

• A lease contract may be concluded with regard to a building that will be constructed in future;
• A tenant may enter the building in order to start fit-out works even before official commissioning of the building;
• A lease contract covering the period since commissioning of the building is not invalid.

On the one hand, these clarifications make the situation with lease of premises in newly constructed buildings more certain and predictable. We may see in future more and more lease contracts starting immediately after official commissioning of buildings.

On the other hand, there is yet not much practice using these clarifications. The long term lease contracts will still be subject to registration and Rosreestr may maintain a more conservative position.

Therefore, it may be recommended to conclude a short lease agreement for the period covering fit-out works, commissioning of the building and until the moment of registration of the long term lease agreement. It is still recommended that the long term lease agreement is to conclude after the state registration of the property rights for the building.

 

The Russian Counsel Team