The present is intended as a follow up on a previous publication on forms of leases and the concept of statutory tenancy under the Rent Control Law of 1983, and covers the common grounds of removability of statutory tenants as well as rent increase restrictions.

What is the protection provided by the Rent Control Law of 1983? As also explained in the previous publication, the Rent Control Law of 1983 provides protection to a certain category of tenants, giving them the right to remain in possession of the leased properties after the expiry or termination of their lease agreements unless and until a ground for eviction provided under this Law exists. As this right is not based on a contact but derives from the application of the Law, it is not contractual but statutory (legislative). So, a contractual tenant (in possession under a lease agreement or a periodic tenancy) that falls into the category protected by the Rent Control Law of 1983, who remains in possession upon expiry or termination of his contractual tenancy, does not become a trespasser but continues to lawfully possess the property as a statutory tenant under the provisions of this Law. A statutory tenancy is accordingly a statutory right of the tenant to irremovability from the property, unless and until a ground for eviction provided for in this Law exists.

To whom do the Rent Control Law of 1983 protections apply? The Rent Control Law of 1983 applies, as aforesaid, only to a certain category of tenants that fulfil certain criteria. The tenant needs to be an EU citizen or a company controlled by EU citizens, the leased property must be a building leased or offered for lease as a residence or for commercial purposes, the leased property must also be in a controlled area to which the Rent Control Law of 1983 applies (which includes all cities and certain larger villages), and the leased property must have been under lease or offered for lease on 31/12/1999. These are rather technical criteria that need to collectively be fulfilled, otherwise no protection is afforded under the Rent Control Law. Obviously, this protection has been left to cover only older properties, as by definition, anything constructed as of 1/1/2000 does not enjoy protection. Likewise, empty plots and petrol stations are excluded. These criteria are derived from the definitions in Article 2 of the Law.

What are the grounds of eviction? The grounds of removability of statutory tenants are exhaustively set out in Article 11 of the Rent Control Law of 1983.

The most common ground is non payment of rent under Article 11(1)(a). If a statutory tenant fails to pay rent on the time this is due, the owner wishing to initiate eviction proceedings has to serve a notice on the tenant calling him to pay the rent so delayed within 21 days. If the tenant pays the rent within this period of 21 days, there is no ground for eviction. If the tenant fails to pay the rent within this period of 21 days, then this constitutes a ground for eviction and the owner can file proceedings before the Rent Control Court for his eviction. Once such application for eviction is filed before the court, it has to be served on the tenant, and if the tenant nevertheless pays all rents in arrears by that time plus the legal costs incurred by the owner within 15 days, proceedings for eviction still cease, unless the owner can prove that the tenant systematically delays the payment of rent. Otherwise, if there is still no payment, the application for eviction proceeds before the court. In order to counteract abuse of the court process by tenants who have failed to pay rent, but chose to defend eviction proceedings by putting forward some form of defence that was doomed to fail but nevertheless would delay the process, a drastic amendment of the Law has taken place, and the court registry can no longer allow tenants to submit a defence in eviction proceedings for non payment of rent, unless they furnish receipts or other proof of payment of rent or unless the tenant pays the amount of the delayed rents into court.
Other important grounds for eviction in Article 11 include the demolition of the leased property where this is not an abuse of right, the demolition and reconstruction of buildings on the property, renovations that cannot take place without delivery of possession, and the highly controversial demand for delivery of possession of the property for the owner’s own use. The provisions of the Law are self explanatory to a large extent, although full of difficulties in practice.
What about the possibility of rent increase οr decrease? The other major restriction, and consequently protection afforded to statutory tenants by the Rent Control Law of 1983, is the control of rent increase. As aforesaid, provisions for rent increases in the previous lease agreement between the parties do not apply once the tenancy becomes a statutory one, and rents in statutory tenancies are determined in accordance with the provisions of Article 8 of the this Law, which is essential.
It has to stressed that under Article 8 it is possible for both the owner to claim an increase in rent and for the tenant to claim a decrease in rent.
There are two basic rules for the determination of a fair rent. The first such rule is that there can be an increase every two years by a percentage set by a decree issued by the Council of Ministers of the Republic. This was initially 14% as stated in the Law, but was later decreased and was kept at 0% for quite a long time. This has only recently been set to 6%, rendering owners able to claim such increase every two years, although a valuation by the Land Registry needs to take place first in order to ensure that this renders a fair amount.
In case this increase by 6% still leads to an amount of rent less than 90% of the rents in the small area around the property, then the second rule is that the owner is entitled to claim that the rent is set at the figure rendered by the 90% of the rents in the small area. This is highly technical and involves valuations with complex factors being taken into account. The basis of such valuation is the comparison between the rents of other properties in the small area with the rent payable for the property.
In rent determination proceedings, the court has to direct the Land Registry to carry out its own valuation, but often the parties who disagree engage professionals of their choice to dispute this.
Due to the difficulties and technicalities involved in eviction and rent determination proceedings, taking legal advice at an early stage is crucial and highly recommended.

Christos Stylianides
Advocate/Partner

Disclaimer: The above is offered as a simplified general outline for the purpose of this Article and does not constitute legal advice.