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Home Real Estate Market Finjus warns that provisions in the draft rental law could generate "adverse effects"

Finjus warns that provisions in the draft rental law could generate "adverse effects"

SANTO DOMINGO.- The Institutionalism and Justice Foundation ( Finjus ) expressed its concern this Tuesday about some of the provisions contained in the draft General Law on Real Estate Rentals and Evictions , considering that they could generate "adverse effects" if they are not corrected and clarified appropriately.

In a statement, the entity points out a series of observations on the project approved last week, in its first reading by the Chamber of Deputies, which seeks to regulate the obligations between tenants and landlords.

"We consider it essential to reformulate substantive and procedural aspects that affect contractual autonomy , legal certainty and the operability of the judicial system," Finjus .

He highlights several points that, in his opinion, should be reconsidered before their final approval.

differentiated treatment of various types of rentals, noting that one of the essential aspects that must be corrected is the lack of distinction between residential rentals and those intended for commercial, industrial, or tourism purposes. "Treating these regimes uniformly can negatively affect economic dynamism, particularly investment and contractual freedom," Finjus .

The regulations applicable to commercial leases should be based primarily on the principle of freedom of contract , given that these contracts are signed between parties with greater negotiating power and different levels of risk.

"It is recommended that legislation focus on the rental of housing , understood as spaces for fixed dwelling for family or personal purposes, and that leases for commercial, industrial or short stay purposes be excluded from its scope, which should continue to be regulated by the Civil Code and the general rules of private law."

Autonomy of will and contractual burdens

The bill introduces several provisions that unnecessarily reduce the scope for negotiation between the parties. For example, Article 4 predetermines the intended use of the property, restricting the possibility of freely agreeing upon its use. Similarly, it establishes a mandatory limit on rent adjustments , imposing an official index in the absence of an express agreement, which could discourage formal leasing and create a disconnect between contracts and economic realities.

There are also provisions that place excessive burdens on the landlord , such as the obligation to offer the property for sale to the tenant without a prior agreement, or that grant rights without a clear legal basis, such as non-legal obligations that the tenant must fulfill. These types of measures should be reconsidered, as they undermine the principle of freedom of contract that governs contractual matters.

Conceptual gaps and legal ambiguities

The project contains omissions and ambiguities that could generate legal uncertainty . An example of this is Article 12, which mentions the concept of "abandonment" without defining it precisely, which could lead to interpretive conflicts and open the door to unnecessary litigation.

Furthermore, even when the parties have agreed to a fixed term for the contract, the termination of the lease depends on an express notice of termination . This provision contradicts the general principle that the expiration of a specific term should automatically terminate the contract, unless there is an express extension or a tacit renewal .

Procedural and enforcement aspects

different procedural regime is introduced for residential and commercial leases without offering a clear technical justification, which could lead to unequal treatment under the law and an additional administrative burden for the judicial system.

A critical issue that remains inadequately regulated is the priority of liens and the protection of the guarantee provided by the tenant. The draft is unclear as to which right prevails when an account is subject to a garnishment order following a deposit return order.

"This regulatory gap must be remedied by incorporating a uniform procedure that establishes clear rules on the execution of the guarantee," he concludes.

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