The laws regulating the letting of
property in Malta have over the years witnessed a number of amendments
which in most cases attempt to balance out the position of the lessor
and the lessee.

The Rent laws were originally regulated
by the Civil Code provided that, with a view to accommodate social needs
 at a time when the situation in Malta was dire, the Government
intervened and regulated the rental market in 1931 through the enactment
 of the Reletting of Urban Property (Regulation) Chapter 69 of the Laws
of Malta. The said laws significantly favoured the lessees vis-à-vis the
 lessor at a point in Malta’s history when such a position was certainly

Over the years the said social
justification lost most of if not all of its strength and in 1995 the
government enacted provisions which ensured that any leases entered into
 after a specific date would be, once again, regulated by the Civil
Code, whereas leases which had already been entered into would keep on
being regulated by means of the old rent laws.

This de-liberalisation of the rental
market led to a discrimination between those dwellings which were being
rented under the old laws, which were subject to the ‘fair rent’
established in terms of Chapter 69 of the Laws of Malta, and those
dwellings being rented out on the free market, with no control on the
conditions of rent.

Under the old regime the owners hardly
had any control over the amount of rent or the conditions of the rental
agreement as these where all set out by law. In addition, the terms of
Chapter 69 precluded lessors from refusing an extension of the lease or
from requesting an increase in rent. This led to a situation whereby a
number of properties where and still are being leased out for what is
technically an indefinite period of time, against a negligible annual

Over and above the possession of rented
dwellings could be inherited by the tenant’s family so long as they were
 living in the same household at the time of death of the original
tenant under the same conditions of rent that pertained to the original

Further amendments in the laws in 2008
attempted to regulate this position. The government attempted to strike a
 balance between the injustice being made against the lessors with a
view to protecting their right to the enjoyment of their property
against the general interest of the community.

Therefore, the Government deemed the 1st
 of June 2008 to be the cut-off point whereby such rental agreements
could no longer be extendable towards the grandchildren of the original
tenant. This however created a discrimination towards those owners whose
 property had already passed into the possession of the said
grandchildren prior to the 1st of June 2008, leading to a
situation by which a number owners could reasonably predict that during
their lifetime they will never have a right to the enjoyment of their
property; a right granted under both Article 37 of the Constitution of
Malta and also Article 1 of Protocol Number 1 of the European

The old rent laws in Malta have been
subject to a number of landmark Constitutional and European Human Rights
 cases. The most recent   one being the case in the names Anthony Debono & Simone Debono vs Attorney General and Stefan and Michelle Mifsud.

In this case the First Hall of the Civil
 Court in its Constitutional jurisdiction, as presided over by Hon.
Judge Lawrence Mintoff, heard how the applicants had obtained title over
 the property through inheritance and had found themselves deprived from
 the right of enjoyment of their property due to the defendants having
detention of the property in accordance with Chapter 69 of the Laws of
Malta. The applicants argued that the laws relating to the rents
pre-1995 in Malta, where to be deemed unconstitutional.

The Constitutional Court making
reference to various preceding judgements of both the local
Constitutional Court and the European Court of Human Rights, delved into
 detail on the matters pertaining to the unconstitutionality of the Laws
 mentioned above.

Article 37 of the Constitution of Malta

The Court gave an interpretation of
Article 37 of the Constitution of Malta, which article provides that no
individual should have his property taken away from his possession in an
 obligatory manner and without fair compensation. The Court confirmed
that this article of the Laws of Malta is not limited to the issue of
expropriation as the general understanding of the Article would suggest
but is extendable to circumstances such as those being dealt with in
this case as well. In addition, the court referred to the First Article
Protocol Number One of the European Convention.

First Article of Protocol Number One of the European Convention

 “Every Natural and Legal person
 is entitled to the peaceful enjoyment of his possession. No one should
be deprived from his possession unless it is in the public interest and
in accordance with the general principles of International Law.”

This legal point was discussed in depth
during the case in question where the Attorney General argued that the
rent law relating to the leases pre-1995 was enacted in the best
interest of the general public and therefore was not in breach of the
European Convention. The Constitutional Court on the other hand made
reference to a wide range of jurisprudence regarding this issue whereby
it determined that  while on the one hand the Government, through the
introduction Chapter 69 of the Laws of Malta, ensured and safeguarded
the rights of the tenants and therefore facilitated the social needs at a
 precarious time in Malta’s history, it prejudiced the rights of the
owners since the laws in question give no consideration to the fact that
 the lessors carried a social weight for a long period of time without
any compensation or help from the State in doing so.

The Court strongly urged that it should
never be the private individuals who are requested to carry alone the
weight of social measures aimed to protect other citizens, unless they
are compensated in fair manner. These pronunciations where made also by
the European Court of Human Rights in the case of Amato Gauci Vs Malta.

Damage Awarded and final declarations by the Constitutional Court

The Court determined that the applicants
 should be compensated for by the state and liquidated the damages in
the amount of €20,000 for the unfair imbalance between the amount they
received in rent for a number of years and the actual rent that they
could have been receiving on the open market. The Court went on to
declare that the lease agreement entered into by the ancestors of the
parties to be null and directed the defendants not to rely on Chapter 69
 of the laws of Malta as a right to the reside in the property as this
was deemed unconstitutional.

The Government following several
constitutional cases of the same nature has been trying to address the
rental market issue in relation to pre-1995 lease agreements. In 2018 a
new amendment to the law was made whereby we saw the introduction of
Article 12B in the Housing (Decontrol) Ordinance of 1959, Chapter 158 of
 the Laws of Malta.  This article aims to grant further rights to the
lessors of dwellings that are currently being rented out under the old
rent laws. This article of the Laws of Malta is however limited to those
 rental agreements which stem from an emphyteusis contract, further
aiding lessors to take repossession of their own properties. Article
12B, Chapter 158 of the Laws of Malta, allows for the Lessors to be able
 to make an application in front of the Rent Regulation Board,
“demanding that the rent be revised to an amount not exceeding two
percent per annum of the open market”. This is subject to the board’s
approval based on a means testing of the lessees as introduced by the
same law. This means testing will consider whether the lessee based on
his income and financial statements can afford such rent and, in the
lack, thereof the Board shall “give judgment allowing the tenant a
period of five years to vacate the premises”. Therefore, this law
provides a remedy for the lessees to either be fairly compensated for
their property or otherwise regain physical possession of the said
property. This is a further step in ensuring that the Laws of Malta are
not in breach of any constitutional and/or human rights.