Commercial Lease Disclosures in Saxony: Expert Guide

Under the German Civil Code (BGB), which has governed German private law since its commencement on 1 January 1900, commercial leasing in Saxony allows for broad freedom of contract; however, landlords are still bound by strict federal reporting and disclosure requirements. Failing to meet these obligations—particularly regarding environmental regulations and building safety—can result in severe fines, voided contracts, or claims for damages from the tenant under the principles of culpa in contrahendo.

1. Energy Performance Certificate (Energieausweis)

Just as in the residential sector, the German Building Energy Act (GEG) demands transparency regarding the energy efficiency of non-residential (commercial) buildings.

• Advertising: According to § 87 GEG, any commercial real estate advertisement (online portals, print media, brochures) must include the energetic parameters: type of certificate (demand or consumption), final energy demand/consumption in kWh/(m²·a), main heating source, and the building's age.
• Viewing and Handover: Under § 80 GEG, the landlord must present the valid certificate to prospective commercial tenants during property viewings and hand over a copy (physical or digital) when the lease is signed.

Penalty: Landlords risk administrative fines of up to €10,000 for failing to present a valid Energy Performance Certificate or omitting required data in advertisements.

2. Pre-contractual Disclosure Duties (Vorvertragliche Aufklärungspflichten)

Under § 241 para. 2 BGB, a commercial landlord has a duty to disclose significant facts about the property that could prevent the tenant from using the space for their intended commercial purpose.

Environmental Hazards and Contamination (Altlasten)

If the landlord is aware of any soil contamination, asbestos, or other hazardous materials on the property, they must disclose this before the contract is signed. Failure to do so constitutes fraudulent concealment (§ 123 BGB), allowing the tenant to terminate the lease and demand damages.

Building Permits and Zoning (Baugenehmigung)

The landlord must disclose if the property lacks the necessary building permits or zoning approval for the tenant's specific intended use. While the tenant is generally responsible for obtaining specific business licenses, the landlord is liable if the property's structural state or zoning makes the intended use impossible (BGB § 535).

3. Operating Cost Settlements (Betriebskostenabrechnung)

Unlike residential leases, which are restricted by the Operating Costs Ordinance (BetrKV), commercial landlords can negotiate which operating costs the tenant bears.

• The Disclosure: The commercial lease must contain a highly specific, exhaustive list of which operating and maintenance costs are passed on to the tenant. If the list is not exhaustive, the landlord may be barred from recovering specific costs.
• The Deadline: While residential landlords lose the right to back payments after 12 months (BGB § 556 para. 3), this strict preclusion does not automatically apply to commercial leases unless explicitly agreed upon in the contract.

4. CO2 Cost Apportionment (Non-Residential Buildings)

The CO2 Cost Apportionment Act (CO2KostAufG), effective since 1 January 2023, applies to non-residential commercial buildings. This law aims to incentivize landlords to improve energy efficiency.

• The Split: Under § 9 Abs. 1 CO2KostAufG, for non-residential commercial buildings, the law mandates a 50:50 split of the CO2 costs between the commercial landlord and the commercial tenant by default. However, parties may contractually agree on a different split to achieve energy improvements (§ 9 Abs. 1 sentence 2). Furthermore, the landlord's share is reduced by 50% or 100% if legal restrictions (e.g., monument protection or local heat planning) prevent energy-efficient upgrades (§ 9 Abs. 3 in conjunction with §§ 7, 8).
• The Disclosure and Reimbursement: If the landlord is the fuel purchaser, they must detail the split in the annual operating cost statement (§ 6 Abs. 1). However, if the tenant is the fuel purchaser (Selbstbeschaffer), the tenant must calculate the CO2 costs and claim the 50% reimbursement from the landlord in text form within six months of receiving the fuel bill or the end of the billing period (§ 9 Abs. 2 CO2KostAufG).

5. Value Added Tax (VAT) Option

Leasing commercial real estate is generally exempt from Value Added Tax (VAT) under § 4 No. 12 UStG. However, a landlord can "opt-in" to charge VAT on the rent under § 9 UStG.

Disclosure and Requirements:

• The landlord must explicitly declare the VAT option in the commercial lease agreement.
• The landlord may only opt-in if the tenant uses the premises exclusively (ausschließlich) for revenue that does not preclude input tax deduction (§ 9 para. 2 UStG). While administrative guidelines (UStAE 9.2) allow a 95% threshold for simplification, the statutory requirement remains 100% exclusivity.
• This means landlords cannot opt to charge VAT to doctors or insurance brokers whose services are VAT-exempt.

6. Disclosure of Rent Brake Exemptions (Mixed-Use Properties)

The strict rent controls of Dresden and Leipzig (the Mietpreisbremse) do not apply to purely commercial leases.

However, if a property is "mixed-use" and classified as residential, the landlord must provide the mandatory disclosure regarding exemptions (BGB § 556g) before the lease is signed.

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