ENG-1984 — Page 216

172

HOUSING

Rent Control in the Private Sector Statutory controls on rents and security of tenure in Hong Kong date back to 1921. The present legislation governing these matters is the Landlord and Tenant (Consolidation) Ordinance.

The legislation is complicated but is under constant review to improve its working and to achieve the objective, recommended in 1981 by a Committee of Review and endorsed by the government, that as soon as circumstances permit, rent control should be phased out.

At present, statutory controls apply only to domestic premises in the private sector unless otherwise excepted. Tenants are afforded rent increase control and security of tenure. Unless a tenant voluntarily vacates the premises, a landlord must apply on certain specified grounds and obtain an order from the Lands Tribunal before he can recover possession.

Heavy penalties are prescribed for harassment of a protected tenant with intent to induce him to leave. However, provisions exist to facilitate negotiations by which the parties may reach an agreement whereby the tenant surrenders his protected tenancy in exchange for a consideration.

The Rating and Valuation Department publishes explanatory pamphlets to help people understand their position in relation to the legislation, and provides an advisory and mediatory service to deal with the many practical problems arising from rent controls. It also operates a scheme under which rent officers attend urban and New Territories district offices on set days each week to deal with referred cases and answer enquiries on landlord and tenant matters.

Pre-war Premises

Legislation controlling rents of pre-war premises and providing security of tenure was instituted by proclamation immediately after World War II and in 1947 was embodied in the Landlord and Tenant Ordinance since re-enacted as Part I of the Landlord and Tenant (Consolidation) Ordinance.

-

Part I previously applied to both domestic and business premises but as from July 1, 1984, it applies only to domestic premises. It restricts rents by reference to pre-war levels (standard rent). New or substantially reconstructed buildings are excluded from Part I controls.

Increases in rents have been permitted annually in recent years, the latest being in July 1984 when the legislation was amended to provide for permitted rents to be 21 times (previously 16 times) the standard rent. However, in no case is the permitted rent to exceed the prevailing market rent. The Commissioner of Rating and Valuation is empowered to certify the standard rent and the prevailing market rent.

There is provision in the legislation for the exclusion from control of premises for the purpose of redevelopment, and generally possession is subject to the payment of compensa- tion to the protected tenants. Jurisdiction under Part I is exercised by the Lands Tribunal while technical functions are performed by the Commissioner of Rating and Valuation.

Post-war Premises

Comprehensive rent control legislation affecting post-war domestic premises has been in force in one form or another since 1963 - apart from the period between 1966 and 1970- and is now embodied as Part II of the Landlord and Tenant (Consolidation) Ordinance.

Part II, which provides security of tenure and controls rent increases, now covers the majority of tenancies and sub-tenancies in post-war domestic premises completed or substantially rebuilt after August 16, 1945. It does not, however, apply to tenancies in

J

--

NAW

--

--

世