Types of Tenancy in Cyprus and Rent Control Law

08 Oct Types of Tenancy in Cyprus and Rent Control Law

Types of Tenancy in Cyprus and Rent Control Law

The Rent Control Law goes back to the year of 1974 where after the Turkish illegal invasion in the Republic of Cyprus and the rise of housing problems to thousand refugees, the above law was implemented to protect Tenants from their Landlords and most importantly to prevent Landlords from evicting them easily.

According to the Rent Control Law, rent properties are considered the buildings rented out such as houses, offices or shops, however farmlands or plots which do not contain a premise in it do not fall under the definition of rented properties.

Currently, in the Republic of Cyprus there are two types of tenancy. The “contractual” and the “statutory” tenancy. It is very important to identify the type of the tenancy which exists in any given case in order to ascertain which Court has jurisdiction to decide on the matter.

Statutory Tenancy

Statutory tenancy arises where the first tenancy expires or is properly terminated and the Tenant remains in possession of the property.  Furthermore, the property, residential or commercial, must be situated within the “controlled areas” as stated under the Rent Control Law (1983) and its latest amendments and the premises must have been completed by the 31^st of December 1999. Furthermore, persons falling under the protection of the Rent Control Law are Cyprus citizens and EU citizens who are residing in the Republic of Cyprus.

The “statutory tenant” falls under the protection of the Rent Control Law and cannot be evicted expect in certain circumstances provided by law. In order for such owner to be able to repossess his property, he has to proceed through Court. The main circumstances under which the statutory tenant can be evicted are the following:

• When the Tenant constantly omits to pay the rent; the rent is in arrear for more than 21 days from the time the notice was given; the Tenant fails to pay the amount due within 14 days from the service of the claim.
• The Landlord satisfies the Court that it is necessary for him to have the property for himself, his family members or dependent parents.
• If the tenant or any other occupant in that property or shop was guilty of causing nuisance or continues nuisance to persons in the same or adjoining property
• In the event that the Tenant, despite of the express non-sublease obligation wished to breach it, and the Court considers it reasonable to adopt such a decision
• In order to demolish the property and construct a new building or make substantial alterations, which will lead to the development of such property.
• If the Tenant is found guilty of using or possessing the shop for illegal or immoral purposes
• In the event that the condition of the dwelling or shop has, in the Court’s view, been aggravated by destructive acts or willful gross negligence of the tenant

All other tenancies, remain contractual tenancies and do not fall under the protection of the Rent Control Law, but are subject to the agreement made between the parties. Usually in such Tenancies, the Tenant remains in possession of the property only during the lease period unless the tenancy is renewed or extended.

However, tenancy of a property for a period not exceeding 6 months is considered to be a contractual tenancy irrespective of when the property was completed or where it is situated.  Any claims in relation to a contractual tenancy fall under the jurisdiction of the District Court and not under the Rent Control.

Rent increase in Cyprus

According to the relevant law, a Landlord can request an increase on the rent amount every two years but the increase in the amount should not be higher than the maximum percentage of 14% set by the Law which was then reduced to 8%.

The Council of Ministers in the Republic of Cyprus issues a decision every two years regarding the maximum increase rate, with the latest decision stating that where the property falls under the protection of the rent Control Law, the maximum increase in rent is zero until April 2021.

In all other cases where they do not fall under the rental law, the following shall apply:

1. Where there is a rental agreement with a relevant rental contract, the increase shall be determined in accordance with the provisions of the contract.

1. If there is no contract, then the owner has the right to demand any increase he wishes.

Amendment to the law

For many years, there have been numerous discussions for amending the current law especially on the subject of evictions which is a timely procedure through the Rent Control Court.

Landlords were obliged to submit an application for eviction and wait for many years until the Rent Control court issued a decision for evicting Tenants who didn’t pay their rent.

Now, the Parliament of the Republic of Cyprus on the 31st of January 2020 has amended the Rent Control Law of 1983, in an attempt to find a faster solution to the disputes arising out of non-payment of rents.

Up till now, a Tenant could avoid any eviction if they paid any outstanding rent within 21 days from the time they received such a letter from the landlord claiming his rents due or to within 14 days from the service of the landlord’s application for possession for any rents due.

Furthermore, the Landlord had the burden of proof upon submission of the application for possession of his property for any unpaid rents by the Tenants and that these rents due are lawfully demanded. This as a result, gave the opportunity to Tenants to submit a defense against the Landlord’s application for possession without any obligation or burden of proof for the payment of unpaid rents and this resulted in a delay and a lengthy process for eviction.

According to the latest amendments, the burden of proof for payment for any outstanding rent has been transferred to the Tenants. Under the new Law, a Tenant can only submit his reply / defense to the Landlord’s application for possession, if they have paid all rent due and have provided proof of such payments to the Court Registrar. Payments of rent can now be proven either through a receipt of the rent amount deposit in the bank account of the Landlord, a receipt from the Landlord or payments made to the Court’s accounting department.

For any questions regarding the any rent dispute in the Republic of Cyprus contact us at info@cmcylaw.com

Nikolas Christofinis

Advocate

Note: The above article does not constitute a legal advice and may not be relied upon for such purposes. Readers are recommended to take appropriate legal advice on the above subject matter.