The Department of Trade and Industry (DTI) has issued a direction on the treatment of residential and commercial rents while the Luzon-wide enhanced community quarantine (ECQ) is still in effect. 

Through its “Guidelines on the Concessions on Residential Rents; Commercial Rents of MSMEs”, certain measures were adopted to cushion the unfavorable effect of the ECQ on those affected.

On residential rents falling due within the ECQ period, a “minimum of 30-day grace period … without incurring interests, penalties, fees and other charges” must be applied.

Refusal to follow this will be punishable with two-month imprisonment or a fine of at least P10,000 up to a maximum of P1 million, or even both.

This same grace period also applies to “commercial rents falling upon micro, small and medium enterprises (MSMEs).”

“Commercial establishments forced to cease operations … will be considered under financial distress due to the lack of revenue while maintaining overhead commitments,” the DTI guidelines added.

This is in line with the provision of the Magna Carta for MSMEs which states that “the State shall recognize the specific needs of the MSMEs and shall undertake to promote entrepreneurship, support entrepreneurs, encourage the establishments of MSMEs and ensure their continuing viability and growth.”

Other suggested “generosity” acts by the lessors of commercial rents include the total or partial waiver of rent, granting of rent discounts, renegotiation of the lease terms and other acts to lessen the impact of the ECQ.

The memorandum order was signed on April 4 and will take effect “immediately upon its publication”. (Jojo Mangahis)