The Real Estate Lease Law No. 87 of 1979 is one of the most important legislations that regulate the rental relationship and protect the rights of tenants and landlords in Iraq. The law aims to achieve justice in real estate transactions and prevent exploitation by either party.
The law was issued after careful consideration of the social and economic conditions in Iraq, establishing a legal framework that governs lease contracts and defines the rights and obligations of the contracting parties. It reflects the state's desire to protect tenants' rights from exploitation while ensuring landlords receive fair returns from their rented properties. The law also seeks to achieve a balance between the interests of both parties to ensure continuity of the rental relationship in a fair and equitable manner.
Law Protecting the Rights of Tenants and Landlords in Iraq
With Osama Tuma for Legal Services and Advisory, we will explore the key topics addressed by the law protecting the rights of tenants and landlords in Iraq:
Effective Dates and Amendments
The Real Estate Lease Law No. 87 of 1979, published in the Iraqi official gazette and effective from July 1, 1979, excluding Article 7 which determines its effective date by a later statement from the Minister of Finance, includes the rights of tenants and landlords in Iraq.
This law has undergone significant amendments over the years through decisions from the Revolution Command Council at that time and orders from the Coalition Provisional Authority after 2003. Understanding these amendments is essential for determining the current rights and obligations of both lessors and lessees.
For example, the Resolution of the Revolution Command Council No. 829 of 1979, based on the provisions of the temporary constitution, is considered a cornerstone for understanding the details of the law and its applications. It is also important to be aware of the legislative orders issued after 2003 that may have amended or interpreted some aspects of the law.
Scope of Application of the Law
The law applies to all constructed properties designated for residential purposes within the boundaries of Baghdad Municipality and Iraqi municipalities. It includes rental transactions between Iraqis and Arab nationals residing in Iraq since 1948. Conversely, some properties are exempt from the provisions of this law, such as properties prepared for housing by the state or public entities. Properties rented to non-Iraqis are also excluded.
Duration of Lease
The law stipulates that the duration of the lease must be specified in the contract between the landlord and the tenant. If no duration is specified, the contract is considered concluded for one year starting from the date of delivery or from the date of delivering the property vacant of occupants if no specific date is defined in the contract. These provisions ensure flexibility in lease agreements and provide a clear legal framework for both parties in cases where a specific duration is not determined.
According to the law, the lease contract extends after its original term as long as the tenant continues to occupy the property and pays rent regularly according to the law. However, recently constructed properties built on or after January 1, 1998 are exempt from these provisions, as the duration of the lease in these instances is determined based on the agreement between the parties without adhering to the general stipulated conditions.
Annual Rent
The law details the protection of the rights of tenants and landlords in Iraq, including setting a maximum annual rent for residential properties at 5% of the total value of the property or 7% for properties rented as rooms.
The Council of Ministers may allow increases in these percentages when necessary. The total value of the property is calculated based on the combined value of land and building at the time of valuation conducted by the financial authority. The rent may be adjusted every five years based on the new valuation to keep pace with changes in property values.
Furniture of the Property
The law that protects the rights of tenants and landlords in Iraq allows the tenant to rent the property furnished or unfurnished according to the agreement of the parties. If furnishing is chosen, an additional 20% of the value of the furniture is added to the annual rent.
Pension companies also retain the right to furnish rented properties, ensuring a comfortable environment for tenants while preserving landlords' rights to control the contents of the rented property.
Rent Increase Due to Improvements
The landlord may request an increase in rent if the tenant makes improvements that enhance the property's value or utility, provided the increase does not exceed the percentages specified by law. This condition ensures a balance between compensating the landlord for the improvements made to the property and not overburdening the tenant financially, thus safeguarding the rights of both tenants and landlords in Iraq.
Estimating Total Property and Furniture Value
The property tax offices are responsible for estimating the value of properties and furniture upon the request of either party to the contract, considering the decisions of the valuation committees and the tenant's right to appeal these estimates according to the governing rules. This guarantees accuracy and transparency in determining the annual rent and adjusting it to align with the actual value of the property and furniture.
Delivery of the Rented Property
The landlord is obliged to deliver the property to the tenant in a condition suitable for use according to what has been agreed upon in the contract. This obligation ensures the tenant's rights to enjoy the property without encountering structural or functional issues that could hinder its proper use. All these procedures ensure the rights of tenants and landlords in Iraq are safeguarded.
Owner Construction on the Rented Property
The landlord has the right to make additions to the rented property, provided it does not conflict with applicable building regulations or significantly undermine the tenant’s benefit. If substantial detriment results from the construction, the tenant may request a reduction in the rent in proportion to the loss incurred. This condition aims to protect the rights of tenants while ensuring that landlords can make improvements to their property.
These legal provisions within the law protecting the rights of tenants and landlords in Iraq demonstrate the Iraqi state's commitment to ensuring the rights of both tenants and landlords, thereby enhancing the stability of the rental relationship and contributing to the development of a balanced and equitable real estate market.
Payment of Rent
Article 10 of the law on the protection of tenants' and landlords' rights in Iraq stipulates that rent must be paid in advance in monthly installments regardless of the duration of the lease contract. Any agreement that contradicts this condition is deemed void. If the lessor is the state or public legal entities, the tenant has the right to pay rent monthly or in one or more installments.
The tenant is also permitted to pay the rent through a notary public or via bank or postal transfer to the landlord's account, providing multiple options for settling the rent according to their financial circumstances. If the landlord refuses to accept the due installment of rent, the tenant may deposit it with the notary public in the city where the property is located within fifteen days of the due date, bearing the landlord's expenses for the notice and deposit, which will be deducted from the deposited installment.
Subleasing and Assignment of Lease
Article 11 prohibits subleasing or assigning the lease wholly or partially without a written agreement between the two parties. This prohibition aims to prevent exploitation of tenants by subtenants and ensure clear rights between the landlord and the original tenant. This prohibition can only be waived by mutual written agreement, ensuring the protection of both landlord and tenant rights.
Guest Accommodations by the Tenant
According to Article 13 of the law on the rights of tenants and landlords in Iraq, the tenant may not accommodate individuals not specified in the lease contract without the landlord's written consent. Certain categories are exempted, such as direct relatives (parents and children) and non-married siblings, provided that the accommodation is sufficient for them and none of them possesses another property in the city. This ensures that the tenant does not exceed the agreed-upon limits and protects the landlord's rights in utilizing their property.
Transfer of Ownership of the Property
Article 14 stipulates that the new owner assumes the rights and obligations of the previous owner under the same law. The new owner must notify the tenant of the transfer of ownership through the notary public within thirty days from the date of registration in their name, attaching a document issued by the real estate registration department. They must also review the property tax department to record the transfer of ownership within the same period.
Occupancy by the Owner or Partner of the Sold Property
According to Article 15 of the law on protecting the rights of tenants and landlords in Iraq, the owner or partner occupying the property after its sale is not compelled to vacate if they wish to continue occupying it as a tenant, unless the new owner agrees to that. If the new owner wishes to occupy the property, they must notify the tenant and give them an opportunity to express their desire to continue renting within a specified grace period.
Residence for Transferred Employees
Article 16 states that those transferred from state employees or public legal entities to another city have the right to occupy their previous residence under the prior lease, while continuing to pay rent from the date of actual eviction.
Grounds for Eviction
Article 17 specifies the grounds under which the landlord may request eviction of the property, including failure to pay rent after warning, subleasing without consent, causing significant damage to the property, using the property for unauthorized purposes, misuse of the property, and leaving the property unoccupied for more than forty-five days without a legitimate excuse, among other reasons outlined in the legal text.
Conditions for Applying Some Eviction Grounds
The conditions for applying eviction grounds include protecting tenants' rights by specifying grace periods before eviction and restricting the repetition of protective interests to once a year. The law also requires written notices to be issued and attached with specific conditions to ensure tenants' rights to defend themselves or request a grace period when necessary.
According to Article 20, landlords renting for residential purposes are obligated to notify the property tax department and the information services or police center of the property's vacancy within 15 days of its vacating. The law prohibits properties from remaining vacant for more than ninety days without a valid excuse, and in case of non-compliance, the financial authority will lease the property according to the provisions of the law.
Prohibition of External Benefits
Article 21 prohibits either party, an intermediary, or any other person from obtaining any money or benefits outside the lease agreement, except for the broker's fee. This prohibition aims to maintain integrity and transparency in the rental relationship and prevent any exploitation or attempts to manipulate contract terms.
Lawsuits Arising from the Law
Lawsuits arising from the provisions of the law are considered urgent and cannot be contested through the correction of the appellate decision. The execution departments are granted a maximum of ninety days to execute the judgment without affecting this period in case of appellate appeal.
Penalties
Article 23 emphasizes punishing violators of the law's provisions with penalties ranging from imprisonment to financial fines. Violations include agreeing to excessive rent, failing to record or deposit the lease contract, and violating the provisions concerning contracting and occupancy, ensuring strict application of the law and protection of the rights of contracting parties.
Execution Follow-up
The property tax departments are responsible for monitoring the implementation of the law's provisions and notifying the public prosecution of violators. This ensures compliance with laws and effective application through continuous oversight and immediate enforcement of the stipulated penalties.
Issuance of Instructions
The law empowers the Minister of Finance to issue necessary instructions to facilitate the implementation of its provisions. These instructions are issued within sixty days of the law's enactment, contributing to clarifying and detailing the procedures and practical applications of the legal provisions.
Repeal of Previous Laws
The old law regulating property rental No. (67) of 1973 and its amendments, as well as the law regulating property rental No. (184) of 1978, along with any text that contradicts the provisions of this law, are annulled. This ensures that rental laws are unified and organized under a single legal framework that achieves fairness and balance between the rights of landlords and tenants.
Eviction of a Tenant Who Owns Another Property
Article 27 obligates a tenant who has acquired a property suitable for residence to vacate the property within fifteen days of being notified by the landlord. The tenant is prohibited from benefiting from the grace period stipulated in the law in this case, enhancing the landlord's rights to regain their property.
Publication and Enforcement
The law on the rights of tenants and landlords in Iraq is published in the official gazette and is effective from July 1, 1979.
Amendments to the Real Estate Lease Law
The new law includes amendments and updates aimed at improving and organizing the relationship between tenants and landlords in line with social and economic developments. These amendments contribute to reinforcing legal protection for both tenants and landlords, providing a clear and organized legal framework for lease agreements.
Decisions from the Revolutionary Command Council
The Revolutionary Command Council issued multiple decisions related to property rental regulation, which have been integrated and amended in the current law concerning the rights of tenants and landlords in Iraq. These decisions aim to achieve social justice and prevent the exploitation of tenants' and landlords' rights, reflecting the government's commitment to applying laws that enhance social and economic stability.
Equitable Treatment for Palestinians
According to Article 1 of the Law on the Rights of Tenants and Landlords in Iraq, Palestinians residing in Iraq since 1948 and their descendants are treated similarly to Iraqis concerning the application of lease law provisions. This means they enjoy the same rights and protections as Iraqi citizens regarding residential lease contracts, reflecting the state's policy of providing legal protection for long-term resident groups.
Types of Properties Exempt from the Law
Properties leased by the state or individuals, properties exempted by a statement from the Minister of Finance, and properties leased to non-Iraqis, whether individuals or entities, are exempt from the scope of the law protecting the rights of tenants and landlords in Iraq.
This exemption means that these properties are subject to the provisions of civil law or specific laws, which may differ significantly from the protections provided by the law. Understanding this exemption is crucial for determining the applicable law for each rental case.
In conclusion, the rights of tenants and landlords in Iraq is a vital subject requiring a precise understanding of the legal provisions that govern this relationship. It is essential to familiarize oneself with the details of the law to safeguard rights and avoid disputes.
If you are looking to protect your rights as a tenant or landlord in Iraq, do not hesitate to contact a law firm in Iraq. We are here to provide the necessary support and assistance. Contact us now to begin securing your legal rights!
