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Ownership change during rent agreement in North Macedonia

What Happens?

In a significant number of cases in Macedonia, the lessor, acting as the proprietor of the premises, has acquired said premises as an investment with the intention of generating income through the collection of rent. Consequently, it is reasonable to anticipate that the lessor may sell the real estate to another party at some point during the lease. Likewise, it is not uncommon for another individual, acting as a purchaser, to acquire real estate that is currently under lease, primarily for the purpose of generating income through rent collection.

Automatic Transfer of Rights Under the Lease Agreement

As per the Law, it is stipulated that in the event of the transfer of an object previously leased to another party, the acquirer, or the buyer who assumes the role of the new owner of the real estate, steps into the shoes of the former owner as the lessor. As a result, the rights and obligations stemming from the lease are transferred from the former owner to the buyer, who now acts as the lessor, and the lessee.

In this context, it is essential for the lessee to understand that the acquirer cannot request the lessee to relinquish possession of the property before the agreed-upon lease period concludes, unless the lease duration has been explicitly defined in the contract or by law. In the absence of such stipulations, the request cannot be made before the expiration of the notice period.

Consequently, the law establishes that the transferor, as the former owner, remains jointly responsible as a guarantor for the obligations of the transferee, who now assumes the role of the lessor, towards the tenant.

The New Owner’s Right to Rent

In accordance with the Law, it is specified that unless otherwise agreed upon, the acquirer, acting as the new owner of the property subject to the lease, has the entitlement to collect rent starting from the day immediately following the acquisition of the property. If the transferor, the previous owner, received rent in advance, they are obligated to transfer this rent to the new owner. This provision is applicable because it is customary for lease agreements to involve prepayments covering half or a full year. In such cases, the previous owner owes the rent to the new owner from the day the real estate was transferred to them until the day the rent was actually paid.

Furthermore, disputes can arise during the actual transfer of real estate possession, as at the time of sale, the tenant typically holds legal and rightful possession, acquired from the lessor as the former owner. Therefore, we recommend addressing this issue through a separate agreement involving all three parties. This agreement can serve to establish the specific point in time from which the new owner gains the right to receive rent.

The law also dictates that once notified of the alienation of the leased property, the lessee may only make rent payments to the acquirer, or the new owner.

Termination of the Contract Due to Alienation of the Property

The law also outlines restrictions regarding when the tenant can terminate the contract in the event of a change in ownership. According to the Law, when the transfer of a leased property results in the transfer of rights and obligations from the lessor to the acquirer, or the new owner, the lessee may cancel the contract under any circumstances. This must be done while adhering to the legal or contractual notice periods, or in the absence of these, the customary notice periods.

Learn more about the investment conditions in North Macedonia, on the following link: Invest North Macedonia

Note: The above does not constitute legal advice and in no way can be accepted or understood as an instruction to act in a specific case. Each legal situation has its own characteristics that should be reviewed at separately, and for that reason we recommend that you contact a professional – a lawyer – for legal advice.


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