Galicia Commercial Landlord-Tenant Laws: LATE FEES

In Galicia, late fees for commercial properties are primarily governed by the Ley 29/1994, de 24 de noviembre, de Arrendamientos Urbanos (LAU), which came into effect on 1 January 1995. Unlike residential leases, commercial agreements (arrendamientos para uso distinto del de vivienda) are characterized by the principle of freedom of contract, as established in Article 4.3 of the LAU.

Statutory Framework for Late Payments

Commercial tenancies in Galicia follow a hierarchy of regulations according to Article 4.3 of the LAU:

1. Mandatory Provisions: Title I and IV of the LAU.
2. Lease Agreement: The specific terms agreed upon by the parties (Will of the Parties).
3. Title III of the LAU: Articles 29 through 35.
4. Supplementary Law: The Civil Code.

If the lease does not specify a late payment interest rate, the default rate depends on the nature of the parties:

• B2B Transactions: Under Ley 3/2004, Art. 7, the interest rate is the sum of the interest rate applied by the European Central Bank to its most recent main refinancing operation plus 8 percentage points.
• Non-B2B Transactions: If the landlord is a private individual, Article 1108 of the Civil Code applies, and the interest is the Interés Legal del Dinero (3.25% for 2024/2025).

Key Compliance Requirements

1. Penalty Clauses: Late fees are considered penalty clauses (cláusulas penales) rather than loans. Under Article 1152 of the Civil Code, the penalty substitutes indemnity for damages and interest unless otherwise agreed. Per Article 1154, a judge shall equitably modify the penalty when the principal obligation has been partially or irregularly fulfilled.
2. Recovery Costs: Under Article 8 of Law 3/2004, in transactions between businesses (B2B), the landlord may be entitled to a fixed amount of €40 as compensation for recovery costs, plus additional reasonable expenses. This fixed fee cannot be claimed in leases where the landlord is a private individual.
3. Grace Periods: Article 4.3 of the LAU grants total freedom to negotiate payment dates and grace periods. The 7-day rule established in Article 17.2 of the LAU applies exclusively to residential leases and does not apply to commercial contracts unless expressly incorporated.

Jurisdictional Enforcement

Any disputes regarding late fees or rent arrears in Galicia fall under the jurisdiction of the Juzgados de Primera Instancia in the judicial district where the property is located, in accordance with the Ley 1/2000, de 7 de enero, de Enjuiciamiento Civil (LEC).