Federal Government Announces Canada Emergency Rent Subsidy

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Bennett Jones LLP[co-author: Kristina Dimitrov - Articling Student]

On October 9, 2020, the Government of Canada announced the Canada Emergency Rent Subsidy (CERS) program for eligible organizations. CERS will replace the Canada Emergency Commercial Rent Assistance (CECRA) program which provided commercial rent relief to eligible organizations from April 1, 2020, to September 30, 2020.

What is CERS?

CERS will provide rent and mortgage assistance from September 27, 2020, until June 30, 2021, to eligible organizations affected by the COVID-19 public health emergency. The federal government will provide support, on a sliding scale, by subsidizing up to 65 percent of a qualifying organization's eligible expenses until December 19, 2020. In addition, organizations temporarily shut down by a mandatory public health order may be eligible for an additional 25 percent over the initial 65 percent subsidy, for a total of 90 percent of relief of expenses, including rent.

It is not determined whether the eligibility criteria will change for the period from December 19, 2020, until June 30, 2021.

Who is Eligible to Apply for and Receive CERS?

CERS will provide financial assistance to businesses, charities and non-profit organizations that have experienced decreased revenues due to the COVID-19 public health emergency. In contrast to CECRA, where property owners were responsible for applying and, if approved, received financial assistance to provide commercial rent relief to eligible tenants, CERS will be available directly to eligible tenants.

The federal government has also announced that financial assistance will also be available to property owners through CERS. No further details have been announced at this time.

What is Next?

In the near future, it is expected that the federal government will provide further details on CERS, including eligibility requirements and the application procedure.

We will update this blog once further information and details become available.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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