British Columbia conditionally restricts commercial lease terminations during COVID-19

3 minute read
08 June 2020

On June 1, 2020, the Province of British Columbia issued Ministerial Order No. M179 ("B.C. Order") pursuant to the Emergency Program Act (British Columbia) prohibiting landlords who were eligible for the federal government's Canada Emergency Commercial Rent Assistance Program ("CECRA"), but did not apply, from issuing notices of termination; exercising any right of re-entry, distraint of the tenant's goods, and taking steps to rent out the tenant's leased property, as a result of a tenant's failure to pay rent when due.

Applications for the CECRA opened on May 25, 2020. The CECRA, that is managed by the Provinces and administered by CMHC, provides eligible tenants with rent relief for the months of April, May and June by requiring participating landlords to reduce the rent owed by 25% and offering commercial landlords forgivable loans for the remaining 50% in order for landlords to reduce the rent owed by their eligible tenants to 25% of the original rent.

One of the requirements for the loans is that the landlord and tenant enter into a rent reduction agreement that prohibits the landlord from terminating a commercial lease for a default, such as non-payment of rent (other than rent owing under the CECRA) caused by a COVID-19 Emergency.   

The B.C. Order is effective immediately and the prohibitions, except as otherwise agreed to by the landlord and tenant, are in place until the earlier of (i) the termination of the CECRA program, (currently June 30, 2020), and (ii) the date in which the British Columbia state of emergency, and any extension, expires.

A notable difference between the B.C. Order and the CECRA program is that the B.C. Order prohibits evictions only as a result of a tenant's failure to pay rent when due , whereas the CECRA program affords broader protection by prohibiting evictions where the basis of the eviction is the result of any lease default caused by a COVID emergency

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