ENG-1975 — Page 142

LAND AND HOUSING

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and business premises and restricts rents by reference to pre-war levels, while excluding from control any new or substantially reconstructed buildings. Following an amend- ment in 1953, permitted increases in standard rents were raised to 55 per cent for domestic premises and 150 per cent for business premises, at which level they have remained ever since. Increased rates charges imposed after March 31, 1975 may be passed on to tenants and sub-tenants.

There is provision in the legislation for exclusion of pre-war premises where redevelopment is intended. Exclusions are made on the recommendation of a Tenancy Tribunal, by order of the Governor, and the payment of compensation to tenants dispossessed is almost invariably a condition of the grant of such an order. A tenant may also agree to accept compensation from his landlord in return for delivering up vacant possession of his premises, and in this event the premises are excluded from further control. Such agreements must be endorsed by the Commissioner of Rating and Valuation and must be in a form approved by him.

There is also provision for a landlord and tenant, or a prospective landlord and tenant, to agree a rent in excess of the permitted rent for a period not exceeding five years, but agreements must be approved by a Tenancy Tribunal. Premises which, since November 1973, have become the subject of such agreements approved by the Tenancy Tribunal are automatically excluded from further control.

The rent control division of the Rating and Valuation Department provides factual information to enable Tenancy Tribunals to determine the amount of compen- sation to be awarded to tenants displaced from buildings subject to exclusion order proceedings or from buildings declared dangerous by the Building Authority. The division also gives assistance to other government departments where pre-war premises are being acquired for public purposes. A general advisory service on tenancy matters is provided and the division often acts as mediator between parties involved in tenancy disputes.

Post-War Premises

In respect of post-war premises, legislation dates back to 1952 with the Tenancy (Prolonged Duration) Ordinance, since re-enacted as Part IV of the Landlord and Tenant (Consolidation) Ordinance. This legislation gave limited security of tenure to certain tenants who had entered into oral tenancy agreements involving the payment of key money or premia. In 1963 the three year security provided by this ordinance was extended to five years. However, the payment of key money in such circumstances is no longer so prevalent in Hong Kong.

Increases in rent in 1961 and the early part of 1962 resulted in the enactment of the Tenancy (Notice of Termination) Ordinance, now Part V of the Landlord and Tenant (Consolidation) Ordinance, which generally requires landlords seeking posses- sion to give six months' notice of termination.

The first comprehensive legislation affecting post-war domestic premises was the Rent Increases (Domestic Premises) Control Ordinance 1963, which was enacted primarily to control increases in rents and provided a measure of security of tenure.