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How has COVID-19 affected the hospitality industry?

16/04/2020
How has COVID-19 affected the hospitality industry?
Photo: IvanKuntsevich/shutterstock.com

Updated on Friday 3 July 2020 -10am

The National Security Council has taken numerous measures in the fight against COVID-19 that were most recently formalised through the Ministerial Decree of 30 June 2020 on urgent measures to limit the spread of the coronavirus COVID–19.

The measures are effective as of 1 July 2020 and shall remain into force until 31 August 2020 (inclusive). They apply to the entire hospitality industry (e.g. hotels, aparthotels, holiday parks, bed and breakfasts, camping’s, vacation rental stays, Airbnb’s) unless stated otherwise:

  • Minimum measures set forth in the safety protocols of the respective hospitality provider must be respected;
  • Restaurants and bars of hospitality providers must at least apply the following measures:
    • social distance of 1.5 metres between the tables unless the tables are separated by a Plexiglass wall or an equivalent alternative with a minimum height of 1.8 metres;
    • maximum 15 seated persons per table;
    • each customer must remain seated at his own table, therefore e.g. buffet formulas are not allowed neither bar servings;
    • staff of any kind whatsoever must wear a mask unless a social distance of 1.5 metres can easily be respected;
    • they can remain open until 1 A.M.;
    • terraces and public spaces must be organised in accordance with the regulations laid down by the municipal authorities;
  • Recreational spaces, gyms, swimming pools and other sports areas of hospitality providers can reopen again, however jacuzzi’s, hammams, steam cabins, nightclubs and dancings associated with hospitality providers must remain closed;
  • Events in conference rooms, meeting rooms, rooms for receptions, weddings, banquets and other parties can be organised for a limited number of participants (of which the capacity limits will be gradually increased over time); and
  • Teleworking is recommended for all hotel staff members whose functions are eligible for remote work. If this is not possible, hotels must take the necessary prevention measures to ensure social distancing.

The governmental measures for the hospitality industry have genuinely been less rigid from the beginning (23 March 2020) than those applicable on restaurants and bars; In particular, (apart)hotels could to a certain extent continue to carry out their activities as they were not obliged to close their business as of 23 March 2020 (in contrast with e.g. holiday parks, bed and breakfasts, camping’s, vacation rental stays or Airbnb’s).

There is however no doubt that COVID-19 has created and still creates a financial burden on the hospitality industry as such, particularly given the following facts:

  • Restaurants and bars contribute most to a hospitality provider’s turnover but are only fully and conditionally operational since 8 June 2020 (see above);
  • Places such as the Ardennes, Brussels, Antwerp, Ghent or Bruges have suffered from loads of reservations being cancelled or postponed. Underoccupancy and since the de-confinement, low occupancy, have led to low turnovers and have made the hospitality sector vulnerable to bankruptcy;
  • Touristic, cultural and natural attractions, amusement parks, cinema’s, playgrounds, public swimming pools and leisure events are now operational again, however measures set forth in the safety protocols of their sectors are to be taken and tickets must be booked in advance. This could be a hindrance to attract tourists; and
  • Tourists and businessmen are on a restricted basis able to fly into or to travel within Belgium. Non-essential travels to and from Belgium remain forbidden although EU citizens (including residents of Andorra, Monaco, San Marino, the Vatican and the UK until the end of the Brexit transition period on 31 December 2020) are allowed to freely travel within the Schengen zone. Also, residents from 15 non-EU countries can enter and leave the EU, which are: Algeria, Australia, Canada, Georgia, Japan, Montenegro, Morocco, New Zealand, Rwanda, Serbia, South Korea, Thailand, Tunisia, Uruguay and China (the latter subject to confirmation of reciprocity).

We encourage hospitality owners and operators to check their lease agreement or operator agreement on clauses with regard to force majeure, hardship, turnover targets, exploitation obligations, etc.

The full text of the Ministerial Decree dated 30 June 2020 can be found here.

Contact

Lieven Peeters

Partner

Jessica Xiong

Associate

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