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Rules for the law for the regulation and control of housing rentals

It was published in the Official Gazette Number 39.799 of the Bolivarian Republic of Venezuela, on November 14 of 2011, the Rules for the Law for the Regulation and Control of Housing Rentals.

The mentioned rules point out in its articles five (05) and six (06) the aspects that must be considered in contracts and the necessary requirements to verify the information in the contract. Then, on its articles seven (07) and eight (08) it provides that in case there is an error or omission in the contract the Superintendence must notify both parties of the contract so that the necessary corrections are made. In case that the contract has no mistakes, the Superintendence will proceed to authorize the parties involved so that in a period, no longer that five (05) business days, to protocolized the contract; business days are defined as those in which public notaries and registries function. Article nine (09) provides that the landlord must introduce before the National Superintendence of Rent Control a certified copy of the lease contract in a period no longer than fifteen (15) business days after it was protocolized so that it will be incorporated in the National Registry of Housing Leases. The landlord that fails to carry out this measure will be sanctioned in accordance with article twenty two (22) and twenty four (24) of the Law for The Regularization and Control of Housing Rentals and in case the contract is protocolized but no introduced before the Superintendence the proper administrative sanctions will be enforced.

With this Regulation is created the National Registry of Housing Leases, which serves the purpose of obtaining statistical data about the housing leases that occur in the country. The article thirteen (13) of this regulation contains the facts that must be included in this registry and article fourteen (14) and fifteen (15) contain the information that must include both the landlord and the tenant for the incorporation of the contract in the Registry.

The Regulation explains the way the rent fee will be calculated: In first place, a calculation is done of the fair prize of the property, which is determined by the use of a formula: VAI: VR x (1 – K/100) x VS x VG, where VAI means: The Value of the Property, VR means: The Value of Replacement of the Property, K means: The percentage of depreciation of the value of the property, which is determined by the chart found in article 21, VS means: Quotient of Seismic Vulnerability, and VG means: Geographical Variation. The value of replacement is calculated by the formula VR=VCA x MCI, where VCA means: The Value of Actual Costs of square meter in the property varying upon the type of construction and MCI means: The total of square meters found in the property. To calculate de VCA, all the relevant factor of the essence of the property will be taken into consideration, such as: structure, walls, roof, floors, sanitary installations, electrical installations, mechanical installations, drinking waters, waters served, doors, windows and any other details that may distinguish the property. So far, includes a chart to calculate the VAC and in cases that are not contemplated by this article the Superintendence will determine the specific circumstances of the construction.

As provided in Article twenty tree (23), the calculation of rent fees shall be based in the following percentage of profitability: a 3% of annual profitability over the value of the property - for those properties owned by a multi-landlord-; and a 5% of annual profitability over the value of the property, for those properties owned by a small landlord.

Given the below explanations, the formula to fix the rent fee is the following: CA = (VI /12) x % RA, where CA means: The value of the rent fee, VI means: The current value of the dwelling [which is the result of the application of the following formula: VI= (VAI/MCI) x MCV, where VAI means: The current value of the property, MCI means: The Total of the square meters of the saleable areas of the property and MCV means: The square meters of the dwelling] and %RA means: The percentage of annual profitability, according to Article twenty tree (23) eiusdem.

Article seventy four (74) of the Regulation lists the following reasonable causes for non-payment of the rent fees: a. A serious illness suffered by the tenant; b. In the event of a tenant’s temporary disability qualified by the National Institute of Social Security, furthermore; c. Economic insolvency during 4 consecutive verifiable months; d. Economic insolvency of older adults and the State must provide them residential care facilities for older people; c. In the event of an economic insolvency of the tenant due to a proven force majeure or chance occurrence.

By means of Chapter XII of the Regulation, the Bureau of Goods in Custody is created and regulated. This Bureau shall have the custody, protection, guard, conservation, possession and administration of goods under their custody by direct orders of the competent authority in matters of Eviction.

Article eighty one (81) of the Regulation provides that in case of a legal action issued by the landlord in order to occupy his property, and an eviction must be carried out, the legal expenses and court costs shall be covered by the plaintiff, though in the rest of cases this cost shall be paid by the defendant.

To conclude, the Third Transitory disposition establish that the National Superintendence of Housing might at any time and as deem convenient due to reasons of collective and social interest to freeze all rent fees.