World Urgent application for partial suspension of Berlin rent caps fails in Karlsruhe
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The Federal Constitutional Court has rejected an urgent application by a Berlin landlord to suspend the second stage of the so-called rent cap in the capital. Landlords did not face any serious disadvantages when it came into force, the court said on Thursday in Karlsruhe. The second stage is due to come into effect on November 22nd and provides for many rents to be reduced to statutory rates. (Az. 1 BvR 972/20)
The emergency application was submitted by a civil law company that rents 24 apartments in Berlin. When the second stage comes into force, it has to lower the rent in 13 apartments according to its own information. Possibly she will reverse that in the coming year - then the Federal Constitutional Court will basically decide on the rent cap. The company therefore applied for the second stage to come into force.
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However, the Federal Constitutional Court has now declared that it is not evident that the economic effects are threatening the existence of the company. There was no threat of irreversible or serious disadvantages or any endangerment to the building fabric either for the complainant or for a significant part of the Berlin landlords. The administrative burden to be assumed is also not such a serious disadvantage. Should the court later decide that the rent cap is unconstitutional, the underpaid rent can simply be claimed retrospectively.
The first stage of the Berlin rent cap came into force on February 23. With it, the rents for almost 1.5 million apartments were retrospectively frozen for five years to the status of June 18, 2019. Rent may increase from 2022, but only by 1.3 percent annually. In addition, upper rent limits were introduced, staggered according to the year of construction and equipment of the apartment. The only exceptions are new build apartments that were ready for occupancy from 2014.
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Nine months later, the second part of the cover should come into force. Then "excessive" rents have to be reduced, which exceed the statutory upper limit by more than 20 percent.
The rent cap has been politically and legally controversial since it was passed. The red-red-green coalition ruling in Berlin wants to use the instrument to ensure that low-wage earners are not pushed out of the city. Opponents argue that the retirement provision of small landlords is at risk and landlords would avoid future renovations.
Several lawsuits against the law are pending in Karlsruhe. For example, almost 300 members of the Bundestag from the Union and FDP filed a norm review suit in May because, in their view, the state of Berlin exceeded its legislative powers with the regulation. This question is still open and needs "a closer examination in the procedure of the constitutional complaint", declared the Karlsruhe judges now. A judgment on the main issue is expected in the first half of 2021.
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Juso federal chairman Kevin Kühnert wrote about Thursday's decision on Twitter: "Good. Carry on". "The Berlin rent cap applies," said the Berlin SPD regional association in the online network. Ricarda Lang, the Deputy Greens federal chairman, tweeted the message with the comment: "For everyone who has an acute need for good news".
The spokeswoman for housing and rents of the Green parliamentary group in the Berlin House of Representatives, Katrin Schmidberger, also welcomed the decision of the Karlsruhe judges. She hopes that the final court ruling on the rent cover will follow this ruling in the coming year. The Berlin Left MP Gabriele Gottwald said this was a "good day for Berlin tenants".
Sebastian Czaja, FDP parliamentary group chairman in the Berlin House of Representatives, however, announced that the FDP "and many constitutional lawyers" are still convinced that the rent cap violates the constitution.
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