Amendment of the law on service charges for residential accommodation in the Netherlands

The distinction between “utilities with an individual meter” and service charges will be abolished. With the legislative proposal, the term “utilities with an individual meter” in Article 7:261 of the Dutch Civil Code (BW) will be replaced by “service charges”.

Article 7:237 paragraph 3 BW stipulates that utilities are also included under service charges. Service charges are then defined as: “the compensation for the goods and services designated by general administrative order that are provided in connection with the occupancy of the residential accommodation”. The current definition is: “the compensation for other goods and services provided in connection with the occupancy of the residential accommodation”.

Furthermore, the legislative proposal changes the current non-exhaustive system of service charges into an exhaustive system, in which the Service Charges Decree will specify which costs may be considered service charges. The Service Charges Decree still needs to be amended to reflect this change, as the current decree contains a list of (non-exhaustive) examples.

The explanatory memorandum acknowledges that adapting the Service Charges Decree to an exhaustive system remains a challenge. Categories of service charges will need to be formulated, under which goods or services can be classified. However, it is expected that for certain categories, this approach will be too difficult (e.g. movable property), and open standards will remain necessary.

The purpose of this legislative amendment is to protect tenants from being charged various costs that should not actually fall under service charges. However, it will still be possible to charge tenants for other costs in addition to the (exhaustive) list of service charges. This must then be arranged in a separate agreement outside the lease contract. The purchase of such services may not be made a mandatory condition of entering into the lease agreement.

The Minister has apparently listened to the advice of the Rental Law Advisory Committee of the Netherlands Bar Association (of which I am a member). The legislative proposal now incorporates the Supreme Court ruling (HR April 24, 2020, ECLI:NL:HR:2020:808) in Article 7:259 paragraph 1 BW. It now explicitly states that the tenant’s payment obligation regarding service charges is limited to the amount of the actual costs incurred, which must also constitute a reasonable fee for the services provided.

The new rules are expected to enter into force somewhere in 2025. The legislative amendment will only apply to new residential lease agreements. For existing lease agreements, the old system will remain in effect.

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Joost Donkersloot works at TK in Leiden as a Senior Attorney at Law, specialising in real estate. He is also a member of the GGI Real Estate Practice Group. Within real estate, he focuses on rent law and apartment rights. In addition, he specialises in the leisure business. He is also a member of TK DACH, the firm’s German desk.