Dutch commercial tenancy law: 7:290 retail space and 7:230a business space

Dutch commercial tenancy law splits rented business premises into two regimes with very different consequences. Retail and hospitality space falls under article 7:290 of the Dutch Civil Code (Burgerlijk Wetboek, BW) and is heavily protected: statutory terms of five plus five years, termination only on grounds listed in the law, and a right to have the rent reset by the court. Everything else that is not residential space, from offices and warehouses to laboratories and consulting rooms, falls under article 7:230a BW, where the parties are largely free to contract and the tenant is left with one safeguard only: protection against eviction, for a maximum of three years.

Which of the two applies is decided by the law, not by the heading on your contract. That single question determines how long you are tied in, how and when either party can get out, and whether the rent can be challenged at all. What follows sets out both regimes, the terms and notice periods that go with them, the statutory grounds for termination, the rent review procedure and the eviction protection that is the only real defence for tenants of other business space.

Which regime applies to your premises

Article 7:290 BW covers built space that is destined for use as a shop, a restaurant or cafe, a takeaway or delivery business, a craft business (ambachtsbedrijf) or a hotel, on condition that the property contains an area accessible to the public where goods or services are delivered directly to customers. Camping businesses are expressly included. Land, appurtenances and any dependent living accommodation that belong to the premises follow the same regime, which is why the flat above the shop is usually part of the same protected lease. In practice this is the world of 290-bedrijfsruimte: the high street, the shopping centre, the restaurant, the hotel.

Everything else that is a built immovable property and is not residential space is overige bedrijfsruimte under article 7:230a BW. Offices, distribution centres, workshops without a public counter, storage units, data centres and the practice rooms of accountants, physiotherapists and consultants all sit here. There is no third category and no gap between the two.

The decisive test is the use the parties agreed on when the lease was concluded, read together with the way the space is actually used. Calling a lease an office lease does not make it one if the tenant runs a shop with a counter open to customers, and a clause stating that the parties opt for the 7:230a regime has no effect if the premises objectively qualify as retail space. In mixed situations the court looks at the main purpose of the letting and at whether the other parts serve that purpose; a stockroom behind a shop normally follows the shop. Because the 7:290 rules are semi-mandatory in favour of the tenant under article 7:291 BW, the parties cannot simply agree their way out of them.

How long a 7:290 lease runs

A 7:290 lease runs for five years, or for the longer fixed term the parties agreed. Article 7:292 BW converts a lease entered into for an indefinite period, or for a term longer than two but shorter than five years, into a lease of five years. When that first term ends, the lease continues by operation of law for a second term of five years; if the first term was longer than five years, the second term is shortened so that the two together add up to ten. After ten years the lease continues for an indefinite period unless one of the parties terminates it properly.

There is one deliberate exit. Article 7:301 BW takes a lease agreed for a term of two years or less outside the protective regime of articles 7:291 to 7:300 BW altogether, which makes it the standard instrument for pop-up shops and trial locations. The trap is in the second paragraph: if the tenant is still using the premises after those two years have run, the full protective regime applies, and it applies from the start of the lease rather than from the date the two years expired. Letting a short lease drift on quietly is therefore how landlords accidentally create a ten-year commitment.

Clauses that depart from the protective rules to the detriment of the tenant are not automatically void, but they need prior approval from the kantonrechter (subdistrict court). Without that approval the tenant can invoke their nullity later, sometimes years into the lease. This is the reason experienced parties apply for approval of a deviating clause at the moment of signing rather than assuming a signature settles the matter.

Ending a 7:290 lease: notice, grounds and the court

A protected retail lease does not simply expire. It has to be terminated by notice, and article 7:293 BW prescribes the form: a bailiff writ (exploot) or a registered letter, with a notice period of at least one year. A landlord who gives notice must state in the notice itself the grounds on which the termination rests; article 7:294 BW makes a notice without grounds void, and the grounds cannot be repaired afterwards in the proceedings.

If the tenant does not agree to the termination in writing within six weeks, the lease continues by operation of law. The landlord then has to bring a claim before the kantonrechter under article 7:295 BW asking the court to fix the date on which the lease ends, and the court can only test the grounds that were stated in the notice. Until that judgment is final the tenant stays put. Landlords regularly underestimate how much time this costs: a year of notice plus a contested procedure easily puts the actual handover two or three years after the first letter. Our overview of terminating a commercial lease works through that timeline in more detail.

At the end of the first term the landlord has only two grounds under article 7:296 paragraph 1 BW. The first is that the tenant has not conducted the business as a good tenant should, which covers structural rent arrears, unauthorised alteration or a persistent breach of the permitted use. The second is urgent personal need: the landlord requires the premises for its own durable use, which includes renovation that cannot be carried out without ending the lease. Personal use also covers use by a spouse, a registered partner, a blood relative in the first degree or a foster child.

Paragraph 2 of the same article adds a waiting period that catches many purchasers of let property. A landlord who acquired the premises cannot rely on urgent personal use until three years have passed since it informed the tenant in writing of the change of ownership. Buying a building in order to occupy it therefore does not shorten the tenant protection that came with it.

From the end of the second term onwards the landlord has more room. Article 7:296 paragraphs 3 and 4 BW add two further grounds: the tenant refuses a reasonable offer for a new lease, provided that offer does not concern a change in the rent, and the landlord wants to realise a use of the property that the applicable planning rules permit. On top of that the court may end the lease on a straightforward weighing of the landlord interest in termination against the tenant interest in continuation. Where the lease ends on grounds other than the tenant own conduct, article 7:297 BW allows the court to award the tenant a contribution towards removal and refitting costs.

The tenant side is simpler. A tenant may terminate at the end of a term with one year of notice and does not have to give any reason at all.

Rent review under article 7:303 BW

Only 7:290 space has a statutory rent review. Article 7:303 BW allows either party to ask the kantonrechter to set a new rent after the agreed fixed term has expired, and in all other cases whenever at least five years have passed since the day the last rent agreed by the parties or set by the court took effect. In other words: once every five years, not more.

The benchmark is not the current asking price. The court compares the rent with the average of the rents of comparable business premises in the same locality over the five years preceding the claim, converted to the price level of that moment. Averaging over five years deliberately flattens a peak or a slump in any single year, which is why a rent review rarely delivers the jump either party hoped for.

Article 7:304 BW adds a procedural filter that decides most cases before they start. A claim to have the rent reset is only admissible if it is accompanied by an advice on the new rent from one or more experts appointed jointly by the parties. If the parties cannot agree on an expert, either of them can ask the kantonrechter to appoint one, in practice often the bedrijfshuuradviescommissie attached to the Chamber of Commerce. The day that request is filed counts as the day the claim was brought, which fixes both the five-year reference period and, as a rule, the date from which the new rent applies. Filing early therefore has direct financial value, and skipping the expert step gets the claim dismissed on admissibility.

Tenants of 7:230a space have no equivalent right. There the rent is whatever the contract says, usually adjusted each year by an indexation clause tied to the consumer price index published by Statistics Netherlands (CBS). Outside that clause, a change requires agreement, or the narrow route of article 6:258 BW on unforeseen circumstances, which courts apply sparingly.

Article 7:230a: eviction protection instead of term protection

For other business space the contract governs. A lease for a fixed term ends when that term expires, without any notice being required, unless the parties agreed otherwise; a lease for an indefinite period ends on notice given in the manner and with the notice period the contract prescribes. The landlord does not need a statutory ground and the court does not test the reason for termination.

What the tenant does have is protection against eviction. Once the lease has ended and the landlord has notified the tenant that the premises must be vacated, the tenant may ask the kantonrechter to extend the period for vacating. The request must be filed within two months of the day on which vacation is required, and filing it suspends the obligation to leave until the court has ruled. Missing that two-month window is fatal; there is no way back once it has passed.

The court grants the extension unless the interests of the landlord would be more seriously harmed by continued use than the interests of the tenant and any subtenant would be by eviction. It refuses the request if the tenant has not behaved as a good tenant should. Each extension lasts a maximum of one year. The tenant may apply twice more, so the total period bought in this way can never exceed three years from the day vacation was first required. The court may also set what the tenant has to pay for the extended period, and no appeal lies against the decision.

Three situations remove the protection altogether: the tenant gave notice, the tenant expressly consented to the termination, or the lease was dissolved because the tenant was in default. A tenant sitting on rent arrears therefore risks losing both the lease and the eviction protection in one move. It is also worth being clear about what the protection is: it buys time to find and fit out alternative premises. It is not a right to stay, and it does not revive the lease.

Passing the lease on: substitution and subletting

A tenant of 7:290 space who transfers the business run in the premises can force the issue. Article 7:307 BW lets that tenant ask the kantonrechter to substitute a third party as tenant, even against the will of the landlord, provided the tenant has a substantial interest in the transfer and the proposed tenant offers sufficient guarantees for full performance of the lease and for sound operation of the business. Without that provision the goodwill in a shop or restaurant would be worth very little, because the location is usually the business.

Tenants of 7:230a space have no such right. There a change of tenant needs the consent of the landlord or a contract takeover under article 6:159 BW, and the general provisions of most model leases prohibit assignment and subletting without written permission. This is one of the practical reasons why the classification question matters in a business sale as much as in a lease negotiation.

What to check before you sign

Start with the classification, because everything else follows from it, and record the permitted use precisely rather than in a broad phrase that neither party can rely on. Then work through the commercial terms in the knowledge of which regime applies. Most Dutch commercial leases are built on the ROZ model lease published by the Real Estate Council of the Netherlands, with separate models for 7:290 and 7:230a space. Those models are drafted from the landlord perspective: the general provisions shift a large part of maintenance to the tenant, exclude most rent reduction and set-off, and give the landlord broad rights on service charges.

The points that decide how much a lease costs you over its life are the split of maintenance and repair obligations, the indexation and rent review mechanism, the security demanded in the form of a bank guarantee or deposit, the condition in which the property is delivered and the obligation to restore it on departure, the treatment of tenant fit-out and improvements, and who carries the burden of energy and sustainability requirements for the building. Break options deserve separate attention: in a 7:290 lease a break clause in the landlord favour departs from the statutory protection and needs court approval, while a break option for the tenant does not. The Dutch government provides a useful practical overview of leasing business accommodation, and it is worth weighing the alternatives of renting, buying or leasing business premises before you commit.

Mistakes that cost the most

Four errors account for most of the disputes we see. Landlords assume that a retail lease ends when the fixed term expires and only discover the notice requirement when the tenant refuses to leave. Landlords also give notice without stating grounds, or add grounds later, and lose the case on article 7:294 BW alone. Tenants of other business space let the two-month window under article 7:230a BW pass and find themselves on the street with no defence. And parties on both sides sign a clause that deviates from the 7:290 regime without asking the kantonrechter to approve it, which leaves the clause open to annulment for as long as the lease runs.

A fifth, quieter mistake is treating the model lease as a neutral standard. It is a starting point, and almost every term in the general provisions is negotiable if it is raised before signature rather than after.

Law & More advises landlords, retailers, hospitality operators and international companies on Dutch commercial leases: classifying premises, drafting and negotiating leases and deviating clauses, termination and eviction proceedings, rent review under article 7:303 BW and substitution of tenants. If you are about to sign, terminate or contest a lease, contact us for a clear assessment of your position.