Maltese lease legislation has undergone significant changes since 1948. Over the years, several amendments have been introduced to balance the rights of both landlords and tenants. However, despite these efforts, the results have been mixed. While the intention behind these legislative updates was to ensure fairness and protection for both parties, the outcomes have not always fully achieved these goals.
This year, however, there have been significant changes to laws dealing with residential leases, which have officially come into force from the 1st of September 2024. In an effort to simplify these changes, we shall be outlining some of the main changes affected by these amendments.
Employer-Employee Lease
One of the first amendments to the Private Residential Leases Act (Chapter 604 of the Laws of Malta) is the introduction of this type of lease. In simple terms, the Act provides that in the case of an employer who is leasing a property for the purposes of providing living accommodation for their employees, and in turn the occupant (that is, the employee) is required to pay some sort of fee for the accommodation (to his employer), then that relationship will be considered as a sub-lease.
Furthermore, the Act states that the definition of lease shall also include a sub-lease, thus making an “employer-employee lease” applicable to this Act. This is a minor, yet vital, classification, as it renders all of the provisions of this Act applicable to this type of lease.
Requirements for the Registration of a Lease Contract
Some of the specific requirements of the lease contract itself have also changed. All private residential leases have to be properly registered with the competent authority. This obligation arises from the commencement of the lease, however the time period within which the lessor is obliged to register the lease contract has now been extended to thirty (30) days instead of the previous ten (10) days.
There was also a new requirement which has been put into place to combat malpractice. This is the introduction of a capping on the number of residents which can be registered under one lease. Upon registering the lease contract, lessors are now obliged to specify exactly the number of residents which are going to reside at the property. Additionally, the new amendments have granted the Minister responsible the ability to make specific regulations in order to outline the number of residents allowed in a particular property, depending on the facilities available. In fact, a specific mandatory criterion has been established.
Requirements of a Lease Contract
By and large, the majority of the requirements of a lease contract are still the same but there have been some slight changes. The usual requirements, such as that the contract is to be made in writing and specifying the duration of the lease are still there, but now there is an additional requirement in the form of taking photographs.
It used to be a common industry practice to take photographs of the furniture and state of the inside of the property, however this is now a legal requirement. Photographs of the inventory must be taken, together with a description of the content and a signature from both parties. This will allow full transparency and prohibit any of the parties involved from making any unlawful claims.
It is of utmost importance to have an expert to guide you on the particular requirements, as failure to comply with any of them will render the contract null. In this respect, is also important to note however, that the nullity of the contract will not in turn exempt the lessor from registering the contract, as this will still have to be done.
New Introductions
Apart from amending systems which were already in existence, there were also several new additions. Primarily, there were the additions of rules regulating an express renewal of a lease, the substitution of lessees and the inclusion of additional lessees. These are all possible, as long as the requirements laid down in the particular provisions of the law are adhered to.
Following recent amendments, the Maltese Legislation dealing with Private Residential Leases now also caters for the letting of shared residential spaces and for the registration of a new lease in the case of consensual termination of the lease or abandonment of property by the lessee. Specific requirements also apply.
Fines and Offences
The Authorities are also doubling down on the enforcement of these provisions, in order to ensure conformity. Indeed, the Act is now even more detailed so as to encapsulate more offences relating to the unlawful leasing of properties.
Any person who is found guilty of for example: forging documents, lying or misusing the property will be fined an administrative penalty which cannot exceed €2,329.37, however, these same offences can be tried before a court which can lead to fines of up to €10,000. In accordance with the above-mentioned efforts to cut down on overpopulated leases, one of the offences listed is in fact lying about the number of residents living in the property, so once again conformity is always key.
How can DW&P Help You?
Apart from the above-mentioned changes, there are several other requirements which have been introduced to the Private Residential Leases Act, which requirements have a significant impact on the performance of the lease. This is precisely the reason why it is in the best interest of both parties involved to have a well-drafted agreement, which will not only confirm with all of the requirements but will also be specifically tailored for your situation.
We here at DW&P would be delighted to help you draft a lease agreement that is tailored for your specific needs. We can ensure complete compliance with the applicable laws, as well as a personalized experience for you. We can help both potential lessors and lessees. We can also guide you on the best way forward and advise you against any conduct which results in any unwanted fines.
Should this be something that interests you, feel free to book a free consultation here: https://www.drwerner.com/en/other/book-an-appointment/
We’d be happy to discuss this, and more, in more detail.
Disclaimer: The above-mentioned article is simply based on independent research carried out by Dr. Werner & Partners and cannot constitute any form of legal advice. If you would like to meet up with any of our representatives to seek further information, please contact us for an appointment.
