The House of Representatives in Egypt, during the plenary session on 22 February 2022, finally approved amendments to the old rent law of premises for non-residential purposes to juridical persons.
Legal persons as defined by Article 52 of law are governmental and municipal bodies; religious entities; endowments (units allocated to charity); commercial companies; associations and political parties; and, shops.
According to the amendments submitted by the government, the law gives juridical persons a grace period of not more than five years, and the rental value is increased by five times the legal value that is currently in force.
Annually and periodically, the last legal value due will increase according to this law by 15 per cent during the following four years. After the end of four years, tenants must clear the unit, or else, the owner will have the right to file an eviction case.
The amendments to the law include organizing the judicial and legal procedures related to vacating the rented premises on the day, which is followed by the expiry of the maximum period specified in the law (5 years) in case the tenant refrains from doing so.
The discussion of the articles of the law during the plenary session faced controversy about the law and some MPs rejected the amendments.
The members also called for an integrated draft law for old rent and to regulate the relationship between the owner and the tenant, especially with regard to residential units. A joint parliamentary-government committee has been formed to amend the landlord-tenant relationship law, says Ahmed Al-Sigini, chairman of the House of Representatives’ Local Administration Committee.
According to Al-Sigini, the committee’s goal is to strike a balance between tenants’ and landlords’ interests. Committee members have also proposed that when the law is changed the government should make subsidized housing apartments available for sale.
Al-Sigini said tenants could feel assured that they will not be evicted from their homes and that landlords will be reassured that they will be receiving fair returns for their property.
“Newly married couples and young people who live in old rent housing units and who might decide to leave these units once the new law is passed could find the subsidized apartments a more affordable alternative,” said Al-Sigini.
The current law restricts landlords of any power to raise rents or evict tenants, which leads to situations where apartments worth millions of Egyptian pounds in the open market, and it makes almost nothing for their owners.
During a meeting in which the matter was discussed, Prime Minister Mostafa Madbouly said, “this issue is one that many governments have inherited and is quite controversial, and it is necessary to deal with it and reach radical solutions that restore the balance between the two parties.”
The draft amendment of the old rent law for non-residential properties tops the agenda of the plenary sessions of Egypt’s House of Representatives. The draft amendment aims to maintain the economic and social stability of Egyptian society by regulating the implementation of the ruling of the Supreme Constitutional Court (SCC), which allows for the eviction of tenants who use residential properties for other purposes.
