An office lease agreement is one of the essential contracts during the establishment and operation of an enterprise. Through the following article, NPLaw provides clients with fundamental legal information regarding office lease agreements.
I. Understanding the office lease agreement
Transactions involving office apartments are significant, including lease agreements, as real estate in general, and office apartments in particular, are valuable assets with considerable impact on the rights and interests of both users and owners. For this reason, an office lease agreement is a vital legal instrument that pays great attention from both enterprise owners and property owners.
At present, apart from small-scale leasing transactions, most apartment owners and enterprises seek professional services for the drafting, review, and assessment of office lease agreements to ensure fairness between the parties and compliance with legal regulations.
II. Legal provisions on office lease agreements
1. Definition
An office lease agreement is a form of property lease governed by Article 472 of the Civil Code 2015, which provides:
- A property lease contract is an agreement between the parties, under which the lessor transfers the property to the lessee for use for a specified period, and the lessee must pay rent.
- A housing lease contract or a lease for other purposes shall comply with this Code, the Law on Housing, and other relevant legal provisions.
Accordingly, an office lease agreement is a written agreement under which the lessor (the owner or lawful person entitled to lease the property) grants the right to use the office apartment to the lessee for a specified term, and the lessee must pay rent to the lessor.
2. Mandatory contents of office lease agreements
As the office lease agreement involves real estate, its contents must comply not only with civil law but also with housing law. Article 163 of the Law on Housing 2023 stipulates that such a lease must include the following:
- (Full) names and addresses of individuals or organizations of both parties;
- Description of the apartment’s characteristics, including shared ownership and usage areas, and usage duration;
- Rental price;
- Payment term and method;
- Lease term;
- Rights and obligations of each party;
- Parties’ commitments;
- Additional agreements;
- Effective date of the contract;
- Date of signing;
- Signatures and full names of both parties, and, if the party is an organization, the affixed seal (if any) and position of the signatory.
3. Can a private enterprise be the lessee in an office lease agreement?
Under Point a, Clause 1, Article 117 of the Civil Code 2015, a contracting party must possess full civil legal capacity and civil act capacity to participate in a civil transaction, including an office apartment lease.
However, a private enterprise is an organizational entity without legal personality. Therefore, it does not meet the subject capacity requirement for entering into civil transactions in its own name.
Accordingly, a private enterprise cannot be the lessee in an office apartment lease agreement. In such a case, the owner of the private enterprise may sign the lease agreement personally to use the office apartment as the business location of the private enterprise.
III. Common legal questions regarding office lease agreements
1. What is the maximum duration for an office lease?
Currently, the law does not set a maximum duration for leasing or subleasing office apartments. In principle, the maximum lease term depends on the lessor’s duration of lawful ownership or use rights over the property.
Therefore, there is no statutory limit on the duration of an office lease; it is subject to mutual agreement between the parties and the remaining term of the property’s use rights.
2. Should a sanction clause be included in an office lease agreement?
Clause 3, Article 418 of the Civil Code 2015 stipulates:
- The parties may agree that the breaching party shall only be subject to a sanction for breach without having to compensate for damage, or shall be subject to both a sanction for breach and compensation for damage.
- If the parties agree on a sanction but do not stipulate both such a sanction and compensation, the breaching party shall only be subject to the sanction.
Thus, in civil contracts, the parties may agree on both sanction and compensation provisions. In the absence of such an agreement, there is no basis for claiming compensation if a breach occurs. Therefore, it is advisable for the parties to include a sanction clause in the office apartment lease agreement to ensure enforceability in case of breach.
3. Is notarization required for an office lease agreement?
Article 164 of the Law on Housing 2023 regulates notarization of housing lease contracts as follows:
- Contracts for purchase, lease-purchase, donation, exchange, capital contribution, or mortgage of housing must be notarized or certified, except as provided in Clause 2 of this Article.
- Contracts for the donation of charitable, social, or public-interest housing; for the purchase, lease-purchase of public property housing; for the purchase, lease-purchase of housing where one party is an organization (including social housing, housing for armed forces, or resettlement housing); for capital contribution involving housing where one party is an organization; or for leases, borrowing, temporary accommodation, or authorization for housing management are not required to be notarized or certified, unless the parties wish otherwise.
Accordingly, parties entering into an office lease agreement are not required to notarize or certify the contract. However, they may voluntarily do so if they deem it necessary.
IV. Legal consultancy services on office lease agreements
Understanding clients’ demand for legal information related to office lease agreements, Ngoc Phu Law Company Limited (NPLaw) offers professional consultancy and assistance in reviewing, drafting, and executing such contracts. Clients are encouraged to contact NPLaw for comprehensive and efficient support from experienced lawyers using the contact details below:
