Terminate the rental of business premises - here's how!
We have summarized everything you need to know about the subject of renting and terminating the rental of business premises in our fact sheet.
What deadlines must be observed for terminations?
Temporary rental agreements do not need to be terminated and expire after the agreed term. For the rental of business premises, the parties can terminate the agreement with a notice period of six months (or longer if agreed) as of a date that is customary for the location, or if there is no local standard, as of the end of a three-month rental term. Your notice letter must be received by the tenant at the latest one day before the period of notice starts. If it was not possible for the recipient to accept the registered letter directly from the mail carrier, it is deemed delivered as soon as it is reasonable for the recipient to pick up the letter from the post office, i.e. usually from the day after the attempted delivery. To be on the safe side, however, the termination should be sent by mail at least eight working days before the start of the notice period so that the termination deadline can still be complied with if the registered letter is delivered on the last day of the seven-day pick up deadline.
What happens if I miss the deadline?
If a deadline has been missed, then the termination is effective from the next possible date.
What form must be complied with?
For residential and commercial space, the termination must be issued in writing. Moreover, the landlord must terminate the agreement with an official form which has been approved by the canton and includes information on the rental object as well as the information necessary to effectively contest the termination or extend the rental agreement. If the landlord does not comply with the legally prescribed form, then the termination is void, but can be replaced by a valid form. To prove compliance with the applicable deadline, we recommend sending the termination as a registered letter.
Does the termination have to indicate reasons?
The termination of a rental agreement is also valid even if it does not provide reasons. However, the tenant can request justification be provided. Depending on the situation, a deferred or rejected termination can be an indication for an objectionable termination.
If the landlord indicates the termination is based on payment arrears of the tenant, a serious breach of the tenant’s duty of care and regard, insolvency of the tenant, or a rental agreement that because of an impending conversion or demolition project has expressly only been concluded for a limited time up until the start of construction or the receipt of the required permits, then this affects any objection to the termination by the tenant as well as whether an extension of the rental agreement will be granted.
What can tenants do about a termination?
A distinction is made between void and contestable terminations. Void terminations have serious formal irregularities and are not valid even if they are not contested. Contestable terminations are generally effective, but can be reviewed as to whether they were lawfully issued.
When is a termination void?
- If it was not issued to all contractual parties
- If it was not issued by all landlords
- Terminations relating to only a part of the rental property (e.g. only a portion of the premises)
- If it was not issued with the official form
When is a termination contestable?
If it goes against the principle of good faith, for example
- if the tenant has claimed a right set out in the rental agreement and the agreement is terminated as payback,
- if the landlord attempts to force the tenant to buy the rental property,
- during mediation or court proceedings with the tenant,
- before three years have lapsed after the conclusion of mediation or court proceedings in connection with the rental agreement, in which the landlord has lost a significant part of the case or has concluded a settlement agreement with the tenant.
How does the objection have to be submitted?
The objection of a termination must be submitted within 30 days after receipt of the termination at the mediation authority responsible for the rental property concerned, and for temporary rental agreements, within 60 days prior to expiration of the contractual term.
When does the 30-day objection period start?
In general, the term starts from the time of receipt. If the mail carrier cannot deliver the registered letter to either the tenant or a third party authorized to receive the mail on the tenant’s behalf, and they leave a collection notice in the mailbox or P.O. Box, then the termination is deemed to have been received as soon as the tenant can be made aware of the letter according to the collection notice at the post office. This is generally the case the day after the collection notice was left in the mailbox, and the objection period starts on this day, even if the tenant picks up the letter a few days later. Only if there are special circumstances (e.g. illness, unforeseen absence of the tenant), then the termination is deemed to be delivered on the day of actual receipt, or on the last day of the seven-day collection period of the registered letter at the latest, meaning the objection period starts thereafter.
What else can be claimed in addition to the objection of the termination?
If the termination was issued legally, then the tenant can request an extension of the rental agreement. However, they can only do so if the termination of the rental agreement would result in particular hardship for the tenant, as they cannot find anything commensurate despite efforts to do so. In such a case, the interest of the tenant must outweigh that of the landlord.
How long can an extension be granted for?
Extensions can be granted twice and last for up to six years in total.
You can download detailed legal information here.