Egypt's parliament to discuss new law aimed at liberalising non-residential rents

Gamal Essam El-Din , Saturday 19 Feb 2022

Following a two-week holiday, Egypt's House of Representatives – the lower chamber of parliament – will reconvene this week, holding plenary sessions on Sunday, Monday and Tuesday.

Egypt s parliament. AP
Egypt s parliament. AP

On Sunday, the house will discuss a government-drafted law that aims to liberalise rents of non-residential units.

A report prepared by the house's Housing Committee said the draft law aims to create a more balanced relationship between landlords and tenants of non-residential units.

"The draft law will give tenants of non-residential units a five-year grace period from the date of its promulgation to adjust themselves, after which they will be forced to pay five times the value of the current rents or be evicted from units," said the report, indicating that "the value of rents will be also annually increased by 15 percent and over the following four years."

The report said the new law was drafted in line with a recent ruling by the Supreme Constitutional Court stating that old rents of non-residential units should be liberalised to reflect economic and social changes, particularly after the breakout of the coronavirus pandemic.

The report argued that the draft law represents an initial step towards striking a balance between the rights of landlords and tenants in a way that will not harm the economic stability of Egyptian society.

The report said the committee members had changed the government's title of the draft law to "A Law on the Procedures and Dates of Evicting Units Rented to Entities for Non-Residential Purposes in Light of the Economic Impact of the Coronavirus Pandemic."

"This title correctly reflects the meaning of the bill and clarifies the exact reasons for promulgating it," said the report.

The committee's member Atef Meghawry said he had expressed reservations during the debate over the government-drafted bill.

"The bill will do a lot of harm to non-profitable entities such as civil society organisations, charitable societies, political parties, consumer societies and trade unions which rent non-residential units to offer free-of-charge services to local communities," Meghawry said.

He indicated that "there are 54,000 NGOs (non-government organisations) which are currently renting units for non-residential purposes and that these will be negatively affected when the rents are liberalised,” adding "while the state declared that the year 2022 will be the year of civil society, we are surprised that this law will come to do a lot of harm to civil society organisations."

Parliament's Sunday schedule also includes discussing government-drafted amendments to the capital market law (Law 95/1992). A report by the House's Economic Affairs Committee said the amendments aim to streamline the performance of Egypt's capital market in line with international rules and criterion and to make use of Egypt's current economic growth in all sectors at the same time.

"In brief, this law aims to provide the funding necessary to achieve greater economic growth and comprehensive development," said the report, explaining that "currently implementing projects will be allowed by this law to issue bonds on the capital market, the proceeds of which will be used to fund its operations, streamline its performance and provide sustainable services."

The house will also discuss Monday a government-drafted law on the procedures necessary to contain the negative impact of Coronavirus and tackle the impacts of the pandemic.

On Monday, the house's agenda of debate will include discussions of amendments to the agrarian reform law (Law 178/1952). The amendments allow the government to use part of the land owned by the agrarian reform institutions to set up national service projects.

On Tuesday, the house's agenda will include discussions of amendments to the income tax law (Law 91/2005), which imposes a tax on trading of properties and land used for construction beginning from 19 May 2013.

The house's schedule will also include debating and passing five foreign agreements. The list includes a $3 million contribution from Egypt to the International Fund on Agricultural Development (IFAD), an agreement with Burundi on the exemption of holders of diplomatic passports from entry visas, and a five million Swedish krone grant agreement with Sweden to fund urban transportation and the purchase of fast track buses on highways.

The list also includes a 10 million Swedish krone grant to improve the performance of Egypt's electricity grid, and a grant from the European Bank for Reconstruction and Development to fund Egypt's purchase of new train locomotives.

The house is also expected to take a final vote on the Egyptian Health Council law which was provisionally approved by MPs two weeks ago.

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