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Dadparvar
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The Constitutional Court in Karlsruhe, Germany, ruled Thursday that Berlin’s Rent Cap Act is unconstitutional as it has undermined Germany’s Basic Law. The Act came into force last year, and its provisions are now deemed void as of April 2021.
The rent cap was enacted in February 2020 as an attempt by the local government to stifle rent hikes and gentrification. It froze rental rates for 1.5 million apartments, which was supposed to last until 2025. After 2025, rental rates were only allowed to rise by 1.3 percent, following the aggregate inflation rates of the German economy.
The Constitutional Court stated that the main rationale of striking down the law was procedural and did not comment on the contents of the law. By enacting the cap, Berlin’s local government has violated Basic Law Article 74(1) in conjunction with 72(1). Since Germany already has federal legislation that guards rent affairs (§§ 556 to 561 of the Civil Code Bürgerliches Gesetzbuch BGB), state legislation should not be allowed to override federal legislation.
The Act was one of the most controversial pieces of German legislation of recent years. It was proposed by a coalition consisting of mainly left-leaning parties after concerns of citizens being gentrified in major cities.
The Act was lauded as a success by most as it seems to have stopped the drastic price hikes that have been happening in Germany. Landlords and property investment firms, however, have criticized the law for interfering with the housing market and policy.
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The rent cap was enacted in February 2020 as an attempt by the local government to stifle rent hikes and gentrification. It froze rental rates for 1.5 million apartments, which was supposed to last until 2025. After 2025, rental rates were only allowed to rise by 1.3 percent, following the aggregate inflation rates of the German economy.
The Constitutional Court stated that the main rationale of striking down the law was procedural and did not comment on the contents of the law. By enacting the cap, Berlin’s local government has violated Basic Law Article 74(1) in conjunction with 72(1). Since Germany already has federal legislation that guards rent affairs (§§ 556 to 561 of the Civil Code Bürgerliches Gesetzbuch BGB), state legislation should not be allowed to override federal legislation.
The Act was one of the most controversial pieces of German legislation of recent years. It was proposed by a coalition consisting of mainly left-leaning parties after concerns of citizens being gentrified in major cities.
The Act was lauded as a success by most as it seems to have stopped the drastic price hikes that have been happening in Germany. Landlords and property investment firms, however, have criticized the law for interfering with the housing market and policy.
The post Germany top court rules Berlin rent cap is unconstitutional appeared first on JURIST - News - Legal News & Commentary.
Continue reading...
Note: We don't have any responsibilities about this news. Its been posted here by Feed Reader and we had no controls and checking on it. And because News posted here will be deleted automatically after 21 days, threads are closed so that no one spend time to post and discuss here. You can always check the source and discuss in their site.