A case initiated with regard to the norms envisaging changes in the determination of compulsory land lease fees as from the beginning of next year
On 19 July 2017, the 1st Panel of the Constitutional Court initiated a case “On compliance of Section 1 of the law “Amendments to the Law on Privatisation of State and Local Government Residential Houses” adopted on 1 June 2017, and of the law “Amendments to the Law on Land Reform in the Cities of the Republic of Latvia” adopted on 22 June 2017, with Articles 1 and 105 of the Constitution of the Republic of Latvia”.
Contested norms
Section 1 of the law “Amendments to the Law on Privatisation of State and Local Government Residential Houses” of 1 June 2017 provides that the second sentence of Section 54(2) of the Law on Privatisation of State and Local Government Residential Houses – “If the parties cannot agree, the land plot lease fee for the owner of the privatised apartment and artist’s workshop shall be 6 per cent a year of the cadastral value of land” – shall be worded as follows:
“If the parties cannot agree, the land plot lease fee for the owner of the privatised apartment and artist’s workshop shall be:
1) from 1 January 2018 – not more than five per cent a year of the cadastral value of land;
2) from 1 January 2019 – not more than four per cent a year of the cadastral value of land;
3) from 1 January 2020 – not more than three per cent a year of the cadastral value of land.”
The law “Amendments to the Law on Land Reform in the Cities of the Republic of Latvia” of 22 June 2017 provides that the second sentence of Section 12(2.1) of the Law on Land Reform in the Cities of the Republic of Latvia – “If the parties cannot agree, the land plot lease fee shall be 6 per cent a year of the cadastral value of land” – shall be worded as follows:
“If the parties cannot agree, the land plot lease fee for the owner of the privatised apartment and artist’s workshop shall be:
from 1 January 2018 – not more than five per cent a year of the cadastral value of land;
from 1 January 2019 – not more than four per cent a year of the cadastral value of land;
from 1 January 2020 – not more than three per cent a year of the cadastral value of land.”
Norms of Higher Legal Force
Article 1 of the Constitution: “Latvia is an independent democratic republic.”
Article 105 of the Constitution: “Everyone has the right to own property. Property shall not be used contrary to the interests of the public. Property rights may be restricted only in accordance with law. Expropriation of property for public purposes shall be allowed only in exceptional cases on the basis of a specific law and in return for fair compensation.”
The Facts
The case has been initiated based on an application by Sonia Traub. The applicant states that she owns a land plot on which is situated a multi-apartment house belonging to other people. There are compulsory land lease relations between the applicant and the owners of the apartment house. The contested norms envisage a new procedure for determining a land plot lease fee as from 1 January 2018. The applicant indicates that this will considerably reduce the income from renting out the land plot belonging to her.
The applicant holds that the contested norms, which considerably reduce the income from renting out a land property, infringe upon and restrict her right to property. She also indicates that the principle of legitimate expectations, which is enshrined in Article 1 of the Constitution, is violated, as the contested norms substantially change the legal regulation and negatively affect certainty and stability of legal relations.
Legal proceedings
The Constitutional Court has requested the Saeima to submit by 19 September 2017 to the Constitutional Court a written reply, presenting the facts of the case and legal substantiation.
The term for preparing the case is 19 December 2017. The Court shall decide on the type of procedure and the date for hearing the case after the case has been prepared.
Open in PDF: 2017-17-01_PR_par_ierosinasanu_ENG
Linked case: 2017-17-01