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The Tortuous Path to Restore Damaged or Lost Real Estate Documents

28-08-2024/in HLP, News /by Rand Shamaa

During the opposition’s control of parts of the Rural Damascus governorate between 2012 and 2018, the Directorate of Cadastral Affairs in Rural Damascus suspended the work on the Land Registry for several real estate areas in the governorate. When official work resumed in 2019, it became evident that the registries for some of those areas had been lost or damaged, necessitating their restoration. However, those trying to restore their real estate documents face an uphill battle.

Properties 1196 and 1197 in the Kafr Batna area, administratively part of the Arbin district in Rural Damascus, are among those whose documents were damaged or lost and were therefore subject to judicial restoration.

On November 23, 2023, the real estate judge of the Rural Damascus governorate issued two identical rulings, numbered 33 and 34, concerning the properties 1196 and 1197. In these rulings, the judge decided to cancel the objections to the properties due to “absence and non-attendance,” meaning the objections were dismissed after the objection period had ended, as the objector failed to submit the documents proving their right to the property.

According to Law No. 33 of 2017, which covers the restoration of lost or damaged real estate documents, restoration involves a set of procedures leading to the issuance of a reliable substitute for the damaged real estate document or the completion of one of its elements. There are two types of restoration: administrative restoration, which occurs when sufficient documents are available to restore the document at the relevant Directorate of Cadastral Affairs, and judicial restoration, which is employed when the documents are completely destroyed.

During the process of judicial restoration for damaged or lost real estate documents, the real estate judge of Rural Damascus announced, on November 24, 2022, a schedule of documents and ownership documents for properties numbered 1181-1200 in the Kafr Batna real estate area. This announcement was based on the decision of the Minister of Local Administration No. 4 dated May 28, 2019, the commencement order for judicial restoration No. 2078 dated June 15, 2019, the provisions of Article 8 of Law No. 33 of 2017 and its executive instructions, and the land registry laws issued by decrees No. 188-189 of 1926 and their amendments, as well as the delimitation and census system issued by decision No. 186 of 1926.

The procedures for judicial restoration are similar to those for delimitation and census under Decision No. 186 of 1926. This includes the publication of the decision to commence the delimitation and census process, the timing, and property information, as well as inviting stakeholders to attend the process. In the decision, the judge outlines the damaged real estate documents, the property numbers, the real estate area, and the sections of the real estate document that need to be restored. Stakeholders are given a six-month period to submit any documents they have that support their claims to the properties with damaged documents. All of this information is published in the Official Gazette and two local newspapers.

If there are no objections within this period, the real estate judge decides to validate the real estate documents submitted by the rightful owners, such as ownership deeds, court rulings, or notarised documents. Based on these documents, new land registries are created to replace the damaged ones. Consequently, the judge issues a final, unappealable decision to confirm the ownership.

In the event of an objection, the rightful owner or their legal representative may submit an objection supported by documents proving their right. After the six-month objection period ends, the land court reviews the submitted objections within two months, in chambers, meaning without summoning the objectors.

The judge only considers objections concerning the existence of rights duly recorded in the Land Registry to be restored. For example, if someone claims ownership of a property based on a purchase contract, they must provide evidence that this right is previously documented in the Land Record within the Land Registry. This could include, for instance, a previously filed lawsuit note on the land record issued by the civil court to confirm the sale in favour of the claimant. The judge’s role is to verify the existence of this note based on the documents available and those submitted by the objector.

Subsequently, the real estate judge issues a decision confirming the restoration of the required land registries. The judge attaches a detailed report to the decision, which includes the property numbers, the real estate area, the parts that have been restored, and the names of the owners. The decision also addresses the outcome of any objections, including the cancellation of objections. The judge will cancel an objection if the objector fails to submit supporting documents within the six-month period to prove their right to the property in question. This was the case for properties 1196 and 1197 in the Kafr Batna real estate area.

Additionally, the judge decided to place a note on the land records for properties 1196 and 1197, indicating that the rightful owners are entitled to either file a lawsuit to “annul the registration” of the property under someone else’s name within five years or to claim financial compensation for the damage caused by the registration of the property under another person’s name within 15 years. These lawsuits must be filed in the regular courts, and the Directorate of Cadastral Affairs must remove this note from the property record once the specified period has expired.

The judge’s decision is considered as a personal notification and can be appealed to the Civil Court of Appeal within 15 days. After the appeal period has passed, the court sends the judge’s decision to the relevant Directorate of Cadastral Affairs for implementation and to open the new property records.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-08-28 00:37:112024-08-28 00:37:11The Tortuous Path to Restore Damaged or Lost Real Estate Documents

Property Fraud and Poor Services in the Yarmouk Palestinian Refugee Camp

09-07-2024/in HLP, News /by Rand Shamaa

Recent reports of increased property fraud in the Yarmouk Palestinian refugee camp in Damascus have prompted many displaced property owners to temporarily return, inspect their properties, and implement some protective measures such as installing doors and windows for houses and securing locks for shops. These individuals are required to obtain temporary security clearance to visit the camp.

Activists from the camp, including lawyer NourEddin Salman, have issued repeated warnings on social media in recent months about widespread property fraud occurring in the camp. These fraudulent activities have resulted in a surge of illicit property sales, with an increasing number of homes being sold illegally. A gang is reportedly selling many shares in undivided common properties in the area between Loubieh Street and the Yarmouk Girls’ School and has allegedly amassed around SYP 2 billion through this fraudulent and deceitful scheme, according to activists. Mr Salman advised anyone looking to purchase property in the camp to first inquire with neighbours about the seller and the property, verify ownership documents, ensure the validity of the sales contract, and obtain a current description of the property’s condition and boundaries from a court-appointed expert engineer.

Wafaa, a displaced resident of the camp now living in Damascus, learned from one of her former neighbours that a few individuals recently inspected her uninhabited house on Al-Urubah Street in the camp with the intent to buy it, according to a correspondent for The Syria Report. When Wafaa’s neighbour inquired, the individuals claimed they were there to view the house, which they said was for sale by its owner. After a discussion, the neighbour identified the person who falsely claimed ownership of Wafaa’s house and was trying to sell it. Based on this information, Wafaa filed a complaint with the Yarmouk Camp police station, which managed to detain the alleged seller who claimed ownership of her house. However, according to Wafaa, this individual was able to bribe the police officers, who then wrote in their report that the incident was a mistake rather than fraud, stating that the seller had mistakenly identified the house due to changes in the area’s landmarks caused by destruction.

Nizar, a Syrian Palestinian refugee from Yarmouk Camp currently residing in Sweden, told The Syria Report that he learned through friends still living in the camp that unknown individuals are renovating a house that belonged to Nizar’s grandfather. The house, located on Thalatheen Street, is partially damaged due to the fighting. Nizar confirmed that he has a court ruling proving his late grandfather’s ownership of the property. He added that his grandfather died in 2010, and then his father was killed in a bombing on the camp at the beginning of 2015, and consequently, the 105-square-metre house became the property of 21 heirs, including Nizar.

He noted that complications prevented them from completing the inheritance process, including the war, the siege of the camp, and the disruption of official institutions. Additionally, none of the heirs remains in Syria except for his uncle, who is disabled and unable to manage his affairs. Two of the heirs are missing, and their whereabouts are unknown.

The inheritance inventory document is the primary document used to determine the names of the deceased’s heirs, their relationship to the deceased, and their respective shares of the inheritance. This document can only be issued after the death of the testator, the registration of their death in the civil registry, and the issuance of a death certificate and a family record for the heirs. After this, the relevant court can be approached to obtain the inheritance certificate. The court then appoints an expert to identify the heirs and their shares of the estate.

Nizar pointed out that those renovating his grandfather’s property have a court-certified purchase contract for the house. He is unsure how someone without ownership was able to sell it to them. He plans to appoint a lawyer to challenge the validity of the sale contract in court.

According to The Syria Report’s correspondent, one of the common practices in the camp currently involves seizing adjacent properties or parts of them during the renovation of a specific property. This is done by encroaching on portions of neighbouring properties, exploiting the destruction and the loss of landmarks. According to activists in the camp, it appears that an influential person has usurped land next to the vegetable market on Palestine Street, which belongs to the General Authority of Palestinian Arab Refugees. The land previously contained buildings and homes that were destroyed, leaving only rubble, allowing the influential person to seize the land and build on it.

The correspondent reported that a real estate office employee in the camp mentioned that some fraud attempts were thwarted after news about them spread on social media. He added that with the increasing number of returnees to the camp, it is rare to find a neighbourhood without at least one inhabited house, which now serves as an early warning network for property owners in the same area, who often share relationships or kinship.

According to estimates by the Action Group for Palestinians of Syria in early June, approximately 50,000 people have returned to the Yarmouk Camp. Despite the concerted efforts by the returnees to improve the camp’s service conditions, they face many difficulties and challenges. For instance, the camp remains isolated from neighbouring areas, with only one entry and exit point via the Batikha roundabout in the Zahira neighbourhood.

Most areas of the camp still suffer from significant problems, such as some streets around the Yarmouk Camp cemetery and the entrance to the Zain neighbourhood (administratively part of Yalda) being flooded with sewage water from damaged and decayed pipes. Potholes abound on Safad Street, making it difficult for vehicles to pass, which hinders the return of displaced residents to the area. The lack of drinking water in many neighbourhoods and the absence of electricity limit stability in some regions. Residents of School Street have requested an electricity supply, but to no avail. Even Haifa Avenue, opposite the building of the Public Establishment for Transmission and Distribution of Electricity (PETDE), remains without electrical coverage. Residents resort to installing electric cables at their own expense in areas without electricity, but these either get stolen or removed by the PETDE, citing network infringement.

Rubble presents a major issue across most of the camp, still densely scattered in the Wasim Project, the Moroccan neighbourhoods, Safad Street, Kafr Qasim Street, and others. This problem is exacerbated by returnees clearing debris from their homes and neighbourhoods, often dumping it around the houses or transporting it to the PETDE’s land area on Thalatheen Street.

Meanwhile, the camp municipality has begun allowing owners of completely destroyed houses to remove the debris and manage it. Typically, these owners make agreements with building contractors to remove the rubble for free in exchange for the contractors taking the iron and metals from the debris to sell to metal traders.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-07-09 17:26:582024-07-17 09:17:02Property Fraud and Poor Services in the Yarmouk Palestinian Refugee Camp

Travel Documents Denied for Regime Defectors

11-06-2024/in HLP, News /by Rand Shamaa

The National Security Office, Syria’s highest security authority, has issued new instructions denying certain categories of Syrians the right to obtain passports through embassies and consulates abroad or through immigration and passport offices within Syria, according to a report published on May 15 by opposition website Sawt Al-Asima

The categories primarily affected include defectors from the army and security agencies, as well as public sector and ministry employees who left their positions without formally resigning. Many government bodies do not accept resignations from their employees, forcing them to leave and be considered as having abandoned their job.

The report states that the implementation of these instructions began in early June, following the dissemination of lists containing the names of defectors and those who abandoned their jobs. It is not clear from the report whether settling one’s security status has  become a prerequisite for granting passports to these individuals. A security settlement involves an investigative process where the subject must confess to any anti-regime activities they have engaged in. This process does not guarantee that those who undergo it will not be arrested or forcibly disappeared.

Syrian Penal Code No. 148 of 1949 stipulates that a government or public sector employee who leaves their job without legal approval, or who fails to return to work within 15 days after their leave ends, is committing the crime of job abandonment. This offence is punishable by imprisonment for three to five years and a fine. Since 2011, the Syrian authorities have added political dimensions to job abandonment, considering anyone who leaves their job to be a security fugitive. Abandoning a military position is subject to the Military Penal Code No. 61 of 1950 and prosecuted for desertion.

To obtain a passport, whether within Syria or at embassies, several documents must be presented. These include the old passport or travel document, a residency card, personal identification, a copy of the family ledger, personal photographs, and for males aged 17-42, a military service document (such as a deferral certificate, discharge certificate, or proof of exemption fee payment). The application must be submitted by the individual themselves or by a relative up to the third degree, such as an uncle or aunt, with proof of relationship.

The negative impact of these instructions goes beyond denying these individuals the freedom to travel and reside abroad legally. It also prevents them from completing transactions in Syria through powers of attorney granted to their relatives or lawyers inside Syria. In matters of housing, land, and property rights, many Syrians living abroad must authorise a relative inside Syria to manage their properties. Since embassies require a passport to notarise powers of attorney, this decision effectively prevents them from notarising these documents at Syrian embassies abroad. Therefore, the inability of these groups to obtain passports abroad means they cannot secure other necessary documents to protect their property rights.

Syrian Civil Code No. 84 of 1949 does not set conditions for issuing powers of attorney, whether inside or outside Syria, beyond specifying the “subject of the commitment,” which is the action or task the representative is required to perform. Personal identification cards of the principal and representative are necessary for completing the powers of attorney but are not a condition according to the civil code. Similarly, Notary Law No. 15 of 2014 does not impose conditions on notarising powers of attorney; it only defines the notary’s duties, which include notarising contracts, declarations, and documents, recording them, and providing certified copies upon request.

Since 2011, numerous decisions and security directives have been issued to impose restrictions on issuing powers of attorney, both domestically and internationally. One such restriction is the requirement for security approval for general powers of attorney. Generally, to issue an international specific power of attorney regarding a property, the following documents are required: the principal’s personal identification card, a property registration statement proving ownership, an inheritance certificate if the property is jointly owned by heirs, a clearance certificate from the finance department, and a valid Syrian passport for the principal.

For issuing any power of attorney or any document by a notary public (a power of attorney issued in Syria), Law No. 15 of 2014 does not require a passport, only a personal identification card. If the ID card is unavailable, the individual may present a valid passport as an alternative form of identification.

Therefore, the requirement for a passport when issuing an international power of attorney contradicts the provisions of the law. Moreover, denying certain groups of people the right to obtain a passport lacks any legal basis.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-06-11 13:42:192024-06-11 13:42:19Travel Documents Denied for Regime Defectors

Explained: Real Estate Brokerage

13-02-2024/in Analysis & Features, HLP /by Rand Shamaa

In mid-January, Syria’s Council of Ministers discussed a memorandum presented by the Ministry of Public Works and Housing to regulate the profession of real estate brokerage, establish real estate brokerage companies, and create an electronic platform to organise the sector and increase its efficiency. No media outlet has published the text of the memorandum, and it appears that the issuance of a law specific to the real estate broker profession may follow this step.

Syrian legislation currently lacks such a law. Real estate brokerage is currently regulated by decisions issued by the Presidency of the Council of Ministers, the latest of which was Decision No. 2139 of 2010. This decision is per Commercial Law No. 33 of 2007 and Companies Law No. 3 of 2008. Real estate brokerage is supervised by the Ministry of Domestic Trade and Consumer Protection, making the Ministry of Housing’s presentation of a memorandum to regulate the profession noteworthy.

To date, there are no real estate brokerage companies in Syria; instead, the profession is carried out by real estate offices, most of which are unlicensed, and those who engage in real estate brokerage are popularly known as “dallal,” or “brokers.” Real estate offices are widespread across all Syrian regions, and there are no figures on their numbers. They do not have a syndicate.

Decision No. 2139 of 2010, with its 15 articles, regulates real estate brokerage, the mechanisms for licensing, and penalties for violations. The decision defined the profession of real estate brokerage as mediating in the sale, purchase, rental, and investment of legally transferable properties and buildings, with the real estate broker being the person who practises the profession.

According to the decision, the Ministry of Domestic Trade and its directorates have the authority to license a real estate broker to practise the profession, provided they are Syrian, over 21 years of age, have obtained a high school diploma, are not employed by the state, and have not been convicted of a serious felony. The broker must have an office that could be owned or rented, an occupancy document, a court rule, or a purchase contract in areas not yet subdivided. Additionally, the broker must have a commercial register and an administrative licence from the concerned governorate or municipality. Copies of the licensing decision must be sent to the Ministries of Economy and Trade, Housing, and Interior, as well as to the governorate and its finance directorate. The real estate brokerage licence is nominal and cannot be transferred to others or inherited after death.

If the terms of the licence are breached, if the broker ceases to practise for a year, or upon their death, the licence will be cancelled. In case of violation, the Ministry of Domestic Trade has the right to close the real estate broker’s office for a month. Brokers are subject to consumer protection laws for supply violations and financial offences and the penal code for criminal matters, such as forgery and fraud (stricter penalties are applied to these).

Real estate brokers must display their licensing documents when reviewing or registering real estate sales or rental contracts at any official entity like the Land Registry and municipalities. They must also clearly display their fees and licences in their offices. The decision requires brokers to maintain a registry of the real estate sales and rentals they mediate, with numbered pages indexed and stamped by the chief clerk of the Court of First Instance in the concerned governorate.

Decision No. 2139 prohibits brokers from engaging in any real estate brokerage before obtaining a recent real estate record for the property in question to ensure no restraint on disposal marks. There are approved templates by the Ministry of Local Administration for sales and rental contracts that brokers must adhere to and keep a copy of.

Decision No. 2139 sets the broker’s commission at a rate of 0.5 percent of the sold property’s price, and one percent of the property’s annual rental value. This commission is charged to the seller and the lessor, not to the buyer or the lessee. However, it is common practice for the broker to receive up to five percent of a sold property’s price, while the commission is usually split equally between the seller and the buyer, with each paying 2.5 percent. Generally, brokers do not adhere to a specific rate, and the commission is subject to multiple factors related to the buyer, the seller, the property’s location, and its prevailing price.

In the local real estate market, the value of commissions that brokers receive remains high despite the market downturn caused by financial inflation and currency depreciation. The market slump was further exacerbated by an increase in property supply due to travel, displacement, and migration, while the commission rate increased as sellers competed for the services of the most renowned brokers in property sales.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-02-13 16:50:162024-02-22 06:35:07Explained: Real Estate Brokerage

Looting and Illegal Property Sales in Palestinian Refugee Camp

07-02-2024/in HLP, News /by Rand Shamaa

The looting and demolition of homes to recycle the rubble is one of the major obstacles preventing displaced people from the Yarmouk Palestinian refugee camp south of Damascus from returning. There are also serious concerns about widespread fraud in the camp involving the sale of properties using forged or stolen documents.

Yarmouk camp, located seven kilometres from the city centre of Damascus, suffered significant destruction during the war and was considered the capital of the Palestinian diaspora. In 2011, it had a population of between 500,000 and 600,000 people, including 160,000 Palestinian refugees. Since its establishment in the 1950s, the camp became a vibrant urban area, extending into the neighbouring Damascus districts. Between 2012-2018, the camp was controlled by opposition forces and Islamist groups, undergoing a crippling siege by the regime forces and continuous bombing, including by Russian aircraft. The fighting caused destruction and the forced displacement of Yarmouk residents.

According to pro-government local media, around four families return daily to the camp, which currently houses about 20,000 people. However, a local correspondent for The Syria Report questioned the accuracy of these numbers, citing more modest estimates from local sources in the camp. They indicated that about 3,000 families, or approximately 15,000 people, currently reside in the camp. The discrepancy in these numbers may be due to the possibility of visiting the camp with temporary security clearance while returning to live there requires security clearance issued by military intelligence.

The correspondent noted that many displaced individuals have managed to repair their homes but have not returned to live in them due to deteriorating security conditions, frequent thefts, lack of transportation, poor services and the presence of stray dogs.

Abu Hassan, a camp resident, told The Syria Report that he received security approval in June 2023 and afterwards visited his home in the 8th of March camp district for the first time after years of displacement. Abu Hassan discovered that his house was in poor condition, looted and with a partially collapsed roof. The house was no longer habitable and needed restoration and re-cladding. In early November 2023, Abu Hassan entered the camp again, only to find a mound of rubble where his house once stood.

The looting crews in the camp were previously made up of small groups, each comprising four to five people. However, after facing violent confrontations with the residents, the groups became larger, including 15-25 workers. According to The Syria Report’s correspondent, looting is ongoing in the Zein, Al-Takamon, 8th of March, and Al-Orouba Street neighbourhoods adjacent to the cities of Al-Hajar Al-Aswad and Yalda. The looting is carried out by crews, most of whose workers are Syrian gipsies, including women, teenagers and children, equipped with hand tools and small trucks. 

While property owners in the camp cannot visit it without temporary security approval, these crews enter the camp daily, leaving with trucks loaded with metals extracted from the rubble through the military security checkpoints that surround all entrances and exits of the camp. The crews leave non-recyclable debris in place, accumulating in the streets and blocking them, despite local community campaigns to remove it. The rubble still blocks alleys and side streets, like the alleys of Palestine Street, Abu Hassan’s stand, Al-Maghareba Street, and the alleys of Ayn Ghazal.

Nevertheless, the real estate sales market in the camp became active in 2023 due to an increase in the number of houses offered for sale through illegal methods. A human rights activist from the camp told The Syria Report that during the armed conflict in the camp from 2012 to 2018, armed groups, both loyalist and opposition, seized personal documents and property deeds from homes whose owners were killed, detained, or displaced fleeing the fighting.

Some of these documents have reappeared for the sale of properties without their owners’ knowledge. The correct property deeds are often used to transfer ownership of these properties, using either correct or forged personal documents and forged sales contracts. In a few cases, the fictitious buyer files a lawsuit to confirm the property sale contract in court. In the presence of two witnesses at the court session, a person claiming to be the seller acknowledges selling the property and receiving payment using the stolen or forged documents. Subsequently, the court issues a ruling confirming the purchase of the property. This court ruling serves as a property deed. It is prevalent in informal areas where properties do not have real estate records, are unlicensed, or are communally owned but not divided.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-02-07 00:28:092024-02-22 06:22:20Looting and Illegal Property Sales in Palestinian Refugee Camp

Explained: Real Estate Transaction Facilitators

09-01-2024/in Analysis & Features, HLP /by Rand Shamaa

Law No. 12 of 2014 regulates the profession of transaction facilitators and petition writers. A transaction facilitator is a person authorised to handle professionally and complete transactions at public and non-public entities on behalf of their owners for a fee. This includes all real estate transactions, payment of fees at the financial departments in Syria’s governorates, documentation at the Cadastral Affairs Directorates, and tracking them in courts.

The bureaucracy of government bodies and institutions, along with legal complexities, often makes completing a simple official transaction at a public entity a time-consuming and complicated task should someone attempt it on their own. Therefore, through their experience and relationships with government employees, transaction facilitators have become vital to expediting transactions and overcoming legal obstacles or by bribing employees.

Since 2011, reliance on transaction facilitators has noticeably increased with the increase in the number of people wanted for security reasons and compulsory military service who fear approaching government bodies. The client base has expanded to include displaced and expatriate Syrians who have lost the ability to follow up on their official transactions at government bodies.

Law No. 12 regulated the terms of transaction facilitators’ work. It specified the conditions that must be met for a professional licence, imposing disciplinary and financial penalties on violators. Among the qualifications for the job, a transaction facilitator must be Syrian, over 18 years old, a high school graduated, without felonies, employed outside of the public sector, dedicated to the profession, and have a permanent office.

Notably, Law No. 12 considers the profession of transaction facilitation a craft supervised by the Ministry of Industry and the General Union of Craftsmen. To practise this profession, a facilitator must pass a conduct examination set by the Ministry of Industry, be a member of the Craft Association in their governorate, have a licence from the specialised Craft Association certified by the head of the Union of Craft Associations in their governorate, the General Union of Craftsmen and the Ministry of Industry.

The law granted the General Union of Craftsmen the authority to determine the fees charged by transaction facilitators. However, in practice, the union does not set these fees; instead, the facilitators autonomously determine their charges. Often, these fees include amounts and gifts given to employees as bribes to expedite the transaction or to find solutions and loopholes to circumvent the law.

A transaction facilitator takes an oath before the Magistrate’s Court to practise their profession with honour and integrity. However, university degree holders are exempt from this oath. The law also allows members of the “Craft Associations for Licensed Real Estate, Administrative and Surveying Activities” in the governorates to engage in transaction facilitation and petition writing.

Law No. 12 stipulates one to three months in prison and a SYP 25,000 fine for anyone working as a transaction facilitator without a licence. Patrols and judicial officers are deployed to Cadastral Affairs departments and government offices to ensure compliance with professional practice conditions and issue warnings or legal notices to those working without a licence.

Before Law No. 12 of 2014, Law No. 119 of 1951 regulated the profession of transaction facilitation and allowed its workers to form their union, which operated until it dissolved in 1969. A craft association for transaction facilitators was established in 1974 under the supervision of the Ministry of Industry. Generally, the provisions of Law No. 119 of 1951 remained in effect until the enactment of Law No. 12 of 2014.

State-run media often report complaints from licensed transaction facilitators about the increasing number of unlicensed individuals in the profession attracted by its good income. This situation creates competition that further relies on networks of corruption and favouritism within government bodies. Some facilitators note that poor internet connectivity and frequent power outages are obstacles to their work, in addition to bureaucracy and the whims of public sector employees. Some local media point out the existence of networks of employees who work exclusively with certain facilitators and deliberately delay transactions for others. Due to declining incomes and difficult living conditions, some lawyers have started working as unlicensed transaction facilitators in recent years.

Besides the high fees charged by transaction facilitators, their work is often marred by delays and procrastination, and they frequently fail to complete transactions within the agreed timeframe. In many transactions involving legal issues, a transaction facilitator may demand a hefty upfront fee, justifying it as necessary for bribing officials or facilitating security clearance in real estate sales. This places clients at the mercy of the facilitator, often without the ability to recover the fee in case of a dispute or the facilitator’s inability to complete the transaction. Some facilitators delay completing transactions to pressure clients for more money, claiming additional funds are needed to bribe officials.

Thousands of people work in transaction facilitation across areas under the Damascus government’s control. For instance, in Lattakia, there are 965 licensed facilitators affiliated with the Craft Association, and in Damascus, there are about 1,200 licensed facilitators, not to mention many unlicensed facilitators.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2024-01-09 19:00:542024-01-10 23:18:48Explained: Real Estate Transaction Facilitators

Explained: Circular Issued to Courts to Clearly Define the Nature of Sold Properties

22-11-2023/in Analysis & Features, HLP /by Rand Shamaa

On October 31, the Ministry of Justice issued Circular No. 17 instructing all judges in relevant courts to specify in their judicial rulings the nature of sold properties and determine whether the real estate right is a property ownership or a “furoogh” for a shop, or if it is a non-commercial lease.

Permanent furoogh leasing contracts are indefinite term contracts, signed before the enactment of the Lease Law No. 10 of 2006, and are subject to mandatory extension, meaning the lease contract is extended regardless of the landlord’s desire.

Furthermore, the circular stressed that the Judicial Inspection Administration and the Public Prosecutors in the provinces should monitor the implementation of the circular and inform the ministry of any violations.

Circular No. 17 was issued in response to previous letters from the Prime Ministry and the Central Organisation for Financial Control. These letters pointed out an error in calculating the real estate sales tax in the financial departments of the various local administrations, which was inconsistent with the Real Estate Sales Law No. 15 of 2021. The error was attributed to the lack of clarity in the nature of the property sold in the court referral: whether it was ownership, furoogh, or both. Due to this ambiguity, financial departments required beneficiaries of judicial rulings to obtain interpretive rulings on the nature of the sold properties, leading to errors in tax calculation.

The Real Estate Sales Law No. 15 of 2021 and its executive instructions issued by Decision No. 850 differentiate between types of property ownership for tax purposes. The law sets different tax rates, the lowest being one percent of the current property value, for land located outside the zoned plans or residential properties within zoned plans. Those residential properties include licensed buildings in zoned areas, whether fully constructed, skeletal, planned, or shared ownership.

If the property is land within the zoning plan, the tax rate is two percent of the property’s current value.

The real estate sales tax rate is three per cent of the current property value for non-residential properties, including both utilised and unutilised commercial properties, whether fully built or still skeletal.

For residential or commercial properties where the right of furoogh (a type of property right) has not been relinquished, the real estate sales tax rate is 40 percent of the current value. If the right of usufruct is also sold, the tax on these sales is 60 percent of the current value.

In the case of commercially leased properties where the tenant has acquired a furoogh right while the owner retains the ownership right, there are two scenarios: first, if the tenant sells the furoogh right to another party, the tax rate is 90 percent of the current value; second, if the owner sells the ownership right to the tenant, the tax rate is 10 percent of the current value.

Law No. 15 prohibits civil courts from issuing rulings on the transfer and confirmation of property ownership or furoogh rights before the litigating parties present a document from the financial departments proving the real estate sales tax payment within a three-month deadline. If the deadline expires without presenting the document, the court will dismiss the case procedurally. The litigants must then refile the case and present the required document. If the court issues a ruling confirming the sale and it becomes final, the court must send a copy of the ruling to the financial department.

In practice, it has been observed that rulings confirming sales and referred to the financial departments often lack detailed descriptions of the sold property, leading to difficulties in levying the appropriate real estate sales tax due to uncertainty about the tax rate. Buyers are forced to return to the court that issued the original ruling to obtain an interpretive ruling that clarifies the nature of the sold real estate right. This need arises because no amendments can be made to the original ruling once it becomes final. These procedures result in additional time, financial burdens and complexity imposed on the rights holders.

Therefore, the Ministry of Justice issued Circular No. 17, emphasising the necessity of specifying the nature of the real estate right sold in judicial rulings.

An image of Circular No. 17

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Rising Number of Kurds Formalise Property Ownership in Northeast Syria

08-08-2023/in HLP, News /by Rand Shamaa

Until just a few years before 2011, the sales of houses, commercial shops, and agricultural lands in northeastern Syria were done via contracts that were not officially registered in the courts or Land Registry.

There were various reasons for this. One was the reliance on personal trust between people due to tribal kinship relationships. Another was a limited understanding of legal matters. There was also a desire to avoid the financial costs of property transfer. Moreover, thousands of Kurds were stripped of their Syrian nationality under the exceptional 1962 census and were deprived of most of their housing, land and property rights, leaving them unable to carry out formal real estate transactions.

As a result, many properties and lands in northeastern Syria remained communally owned and undivided. Their ownership documents were unofficial sale contracts known as “barania contracts” – in Arabic, barania means “outside”, here referring to contracts being “outside” the legal system, i.e., informal. However, the accumulation of these issues over time led to many serious problems affecting housing, land and property rights.

Today, a number of factors — urban growth and zoning expansion, population growth with internally displaced families from other governorates, and multiple, overlapping authorities in control of northeastern Syria– leave the heirs in the governorate fearing they could lose their property rights. Decree No. 49 of 2011, which finally granted Syrian nationality to Kurds previously registered as “foreigners”, has contributed to a surge in demands from this group to formalise real estate transactions that occurred during the period in which they were deprived of Syrian nationality as ownership by foreigners is very restricted.

As a result, many people are now seeking to solidify their property ownership in the official land registries. To do this, an individual (or one of their heirs) wishing to confirm their property ownership, referred to as the “first party”, must present the unofficial “barania” sales contract to the original seller (or one of their heirs) — referred to as the “second party” — under whose name the property is still registered. The first party then asks the second party to acknowledge the validity of the barani contract in court.

In many cases, the second party unofficially demands a sum colloquially termed the “taradia” (or “appeasement”) in exchange for acknowledging the sale in court. Currently, this amount depends on the property’s size and location. One heir occupying a property in Qamishli told The Syria Report that he paid around USD 3,000 to the lawyers of the original property seller’s heirs (under whose name the property is still registered) to have them acknowledge the barania sales contract’s validity in court, even though the sale occurred 40 years ago.

If the first party’s lawyer initiates a case to validate the property sale for their client in the relevant court, and official notifications are made through newspapers, and the second party or their legal representative becomes aware of this, the second party often intervenes in the lawsuit. At this point, if the first party does not pay the taradia, then the second party usually obstructs the lawsuit’s progress. The second party may then resort to prolonging the lawsuit, either by denying the barania contract’s validity or challenging its authenticity, alleging forgery.

If the first party has lost the barania sales contract, the second party might demand a larger payment, asking for witnesses from the neighbourhood who can confirm that the first party indeed occupied the property before 2011. Thus, particularly if the property in question is commercial or residential, the first party might be compelled to yield to the second party’s demands.

For example, when Zuhair, one Hassakeh resident, conducted a topographical survey on a plot intended for construction that he purchased 30 years ago, he discovered that 30 square metres of it were public property. Nonetheless, Zuhair had to pay a taradia for the entire land area before the original seller agreed to confirm the contract’s validity in court. 

In contrast, AbdulRahman, another local resident, didn’t need to pay any taradia when he filed a case to validate the purchase contract of his house, which he has lived in for 40 years. This was because the seller had emigrated from Syria years ago and didn’t delegate anyone to handle his affairs. The seller did not attend the court hearing, despite being notified through official newspapers. After listening to two witnesses and conducting a local investigation, the judge decided on the matter, issuing a decision to validate the contract.

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Explained: Procedural Rules for Farmers’ Cooperatives and Acquiring Members’ Lands

11-07-2023/in Analysis & Features, HLP /by Rand Shamaa

The Ministry of Agriculture and Agrarian Reform issued the procedural rules for productive farmers’ cooperatives via Decree No. 20 of May 16, 2023. These rules centre around the collective cooperation of members to improve agricultural production but also impact members’ rights to use and possess their lands. The new procedures are an extension of Agricultural Regulation Law No. 21 of 1947 and its amendments, which regulate all aspects of agricultural union activity and production. 

A cooperative association must contain at least 30 members who implement collective work towards agricultural investment and increased production. The group structure must include a general assembly that is the highest authority, composed of all its associates and founding members. This body’s duties are to discuss and approve plans, accounts and projects. Next comes the association council, which serves as an executive authority and which consists of five to nine members. The general assembly selects it. Each association must also have a director appointed by that governorate’s Farmers’ Union who coordinates with the association council in carrying out the group’s work. 

Under the new procedural rules, a farmers’ collective is a legal entity from the date of its registration with the General Farmers’ Union, enabling it to own movable and immovable assets. It is also exempt from any fees related to real estate registration, such as those for sales and taxes on real estate and building plot revenue. 

The rules also oblige each member of a farmers’ collective to acquire a number of shares corresponding to the amount of land they own in the area where the collective works. Those who own fewer than eight hectares of irrigated land or orchards get one share per hectare of such land. Farmers with more than eight hectares get two shares for each additional hectare. Owners of no more than 30 hectares of rain-fed farmland get one share per three hectares of such land. The value of each share is SYP 1,000. These shares are registered under their owners’ names. However, creditors may seize these shares to ensure payment of debts owed by the collective.

The new procedural rules stipulate that members commit to providing their farming equipment and place them at the disposal of the collective, so that the group can use them. There is also a rule that each member must provide the land they own in the area where the collective works and place it at the collective’s disposal for management and investment, provided that ownership remains with that member.  

In short, the collective’s lands are those that the members provide for collective investment, in addition to lands that the state may allocate to benefit the group and lands that have devolved to collective ownership. The collective’s lands are considered to be an integrated production unit. They may be divided into large fields to help increase productivity and usage of modern farming methods. Members of the collective share the responsibility for investing in these lands. 

The collective must open a register of the names of landowning members, the type of their lands, the surface area and estimated value upon subscription. The collective is entitled to implement irrigation networks, roads, land reclamation, and construct buildings in locations required for production, so long as the general assembly’s decision approves these works. 

Production costs are deducted from the collective’s net income. Around 17 percent of the group’s net income is also deducted: 10 percent for regulatory reserves and means of production, five percent for the social security and health fund, one percent for social and cultural affairs; and one person for rewards. Meanwhile, the remaining net income is distributed as follows: 70 percent for the members, based on the total working days each members provides, and 30 percent based based on the percentage of land each member has placed at the collective’s use.

The collective grants certain rewards to its members, such as securing short-term loans, issuing savings bonds for emergencies, disability insurance, insurance against losses, theft or fire, social security, social assistance, and marketing the group’s surplus production – that is, production beyond the personal consumption needs of the members.

However, joining a collective deprives farmers of their right to use their land, regardless of its size, because they have provided it to the collective. The new procedural rules overlook the process for returning a piece of land to its owner upon termination of their membership in the collective. Membership ends upon withdrawal or death if the collective dissolves when the number of members dips below 30, if it merges with another collective or if its work is at a loss. The new rules also failed to address the condition of the land upon return to its owner, and how the owner would be compensated in cases of damage to their land. 

A member withdrawing from their collective with the approval of the general assembly has the right to obtain the land they provided to the collective, or land of equal value if handing over their original property would impede the group’s investment operations. In short, the landowner might not receive the same piece of land they had initially placed at the collective’s disposal for collective use. In this case, the withdrawing member may sell their land to another collective member or a third party, so long as that third party joins the collective. Under the procedural rules, the withdrawing member may not sell their land if it was originally agrarian reform land or state-owned land. If a member of the collective dies, their rights are liquidated with the heirs in line with any relevant regulations and laws in force, and in this case, they are treated the same as a withdrawing member.

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Explained: How Different Types of Power of Attorney Impacts HLP Rights

20-06-2023/in Analysis & Features, HLP /by Rand Shamaa

Updated on December 13, 2023: We made clearer the difference between a power of attorney and a judicial power of attorney.

Syria’s Civil Code, issued under Legislative Decree No. 84 of 1949, regulates the provisions of power of attorney, arranged by a person, known as the principal, before the notary for another person, known as the agent. 

The agent, under this power of attorney, can visit all departments, such as the Land Registry and the financial department in their governorate, to perform activities and behaviours that have legal effects on the rights and obligations of the principal, such as buying, selling or renting property, receiving a salary, and more.

A power of attorney is different from a judicial power of attorney, which is a document that a person arranges exclusively for a lawyer before a representative of the Lawyers’ Union to conduct a lawsuit on their behalf before the courts.

The power of attorney is divided into two types:

First is the general power of attorney. The principle is that it does not empower the agent to perform transactions with the principal’s assets, such as selling or relinquishing rights or acknowledgment. Article 667 of the Civil Code stated that the power of attorney mentioned in general terms with no specification for the type of legal work does not empower the agent to do anything but usual management tasks only. These tasks include renting property owned by the principal for fewer than three years, collecting receivables, repaying debts and other transactions required by administrative tasks, such as selling crops or goods prone to damage. Thus, the legal concept of the general power of attorney mentioned in general terms is confined to management tasks rather than transactions.

However, a printed form under the title “general power of attorney” issued by the Ministry of Justice has become widespread and encompasses all kinds of transactions and management. This includes the authority to sell and buy assets in all their types, such as movable and immovable properties. This power of attorney is authenticated before the notary as a general power of attorney that gives the agent the right to handle all the principal’s assets. This has made the matter somewhat ambiguous. But, the jurisprudence of the Court of Cassation has settled that consideration here takes into account not the form of the power of attorney, but rather what it includes in terms of the type of transaction, such as selling, or in terms of its location such as specifying the property’s number. So, if the power of attorney does not include the type of transaction, it is a general power of attorney for administrative tasks only.

However, if it does specify the type of transaction without specifying its location, then the power of attorney is specific in the type of transaction and general in its location. In this regard, the Court of Cassation stated in its Decision No. 2049 of 1998 that as long as the power of attorney with this quality has both a general and specific nature, the agent is not accused of exceeding the boundaries and breadth of the power of attorney.

The General Authority of the Syrian Court of Cassation, the highest Syrian judicial reference, confirmed in its Decision No. 71 of 2002 the rule of possibility of determining the type of transaction in the power of attorney without specifying its location. Therefore, the power of attorney is considered specific in the type of transaction and general in its location, regardless of the form of the power of attorney. Thus, the general power of attorney that included a clause on the sale without specifying the type of property is valid from a legal point of view and enables the agent to make transactions with the principal’s assets.

Second is specific power of attorney, which is the power of attorney that specifies the legal acts required, which could include, for example, managing assets  on behalf of the principal, conducting paperwork required by law, and collecting pensions and salaries on behalf of the principal, and others. This means this power of attorney is more specific to the type of work intended to be carried out. The principle is that transactional tasks like selling, donating, and mortgaging require a specific power of attorney, and it is sufficient to determine the legal transactions without specifying their location. Meaning, the specific power of attorney is considered correct if it included selling without specifying the location of the sale, according to Article 668 of the Civil Code.

In principle, all powers of attorney, no matter their classifications, are revocable. That is, the principal can dismiss the agent and terminate or restrict the power of attorney at any time. Unless the specific power of attorney included a clause in its body indicating that it was issued for the benefit of the agent, or for the benefit of another, then in this case only it becomes an irrevocable specific power of attorney. Here, the principal cannot terminate the power of attorney or dismiss the agent without the consent of the person for whose benefit it was issued, according to Article 681/2 of the Civil Code. Therefore, we find that all powers of attorney for property sales issued by the notary rely on the text of Article 681/2, as they render the power of attorney irrevocable, and as a definitive sale certified with an official document.

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Buyers from Iraq and Deir-ez-Zor Purchase Homes in Qudsaya, Rural Damascus

14-06-2023/in HLP, News /by Rand Shamaa

Similar to Moadamiyat Al-Sham in Rural Damascus governorate, traders from Deir-ez-Zor governorate are also buying properties in the nearby city of Qudsaya.

Qudsaya is located west of Damascus, on the old Beirut-Damascus highway. The Barada River passes through the city. Various army units, most notably the Republican Guard, have seized large tracts of land in Qudsaya and the neighbouring town of Al-Hameh. On these lands, settlements housing for officers’ families were established. This has sparked local tensions and conflict since 2011. In addition, many housing cooperatives have initiated housing projects in Qudsaya and Al-Hameh, for members of those groups. Many of these people are not local to the area.

About 150,000 people lived in Qudsaya before 2011, but this number rose significantly due to displacement during the war. The current estimated population is around 400,000 people, including thousands of Palestinian refugees. In 2012, Qudsaya and Al-Hameh were part of a single military zone controlled by armed opposition factions, and which saw battles with regime Republican Guard forces. In October 2016, a Russian-backed reconciliation agreement was reached that stipulated the evacuation of opposition forces to northern Syria.

According to a local correspondent for The Syria Report, some businesspeople from Deir-ez-Zor governorate, as well as a few Iraqi nationals, have in the past two years purchased around 120 apartments in Qudsaya. This demand for real estate, in a densely populated town, has increased significantly the prices.

The correspondent added that sales and purchases in the area are done through brokers and real estate traders, and can be divided into two groups: those who are originally from Qudsaya and are looking for properties for sale in the town, and those from Deir-ez-Zor who are taking on the task of finding buyers. Initially, brokers from real estate offices in Qudsaya compete for properties that are for sale and bid privately amongst themselves before reaching tacit agreements on prices and locations for the sales. After agreeing with a property owner on a sale, the broker contacts a broker from Deir-ez-Zor to offer them the property. The Deir-ez-Zor, or Deiri, broker then, in turn, offers that property to prospective Deiri or Iraqi buyers who are interested in buying real estate in Qudsaya. 

Qudsaya, as well as the neighbouring town of Al-Hameh, were among the areas where Iraqi families sought refuge after the Iraq war in 2003. There is a square in Qudsaya that has since then been popularly referred to as Fallujah Square due to the number of Iraqi residents there. Some Iraqis remained in Qudsaya even throughout the Syrian war and the siege of the city imposed by regime forces.

In the past two years, sales have been concentrated in the area of the Tailors’ Housing Cooperative on the outskirts of Qudsaya, despite the fact that public services there are worse than in the heart of Qudsaya. The area is named after the Tailors’ Housing Cooperative Association, which bought land and built apartment buildings on it before 2011 for Syrian applicants to the housing there. As a significant portion of those applicants were not from Qudsaya, they sold their flats to Iraqi traders. They were motivated to sell by the risks of returning to a town still suffering the impacts of the reconciliation deal, including a partial siege imposed by regime forces.

Since early 2022, the price per square metre of unfinished housing in Tailors’ Housing has risen from SYP 400,000 to 600,000, equivalent to prices in the heart of Qudsaya. The price per square metre in some finished flats in the Tailors’ Housing has surpassed SYP 2 million.

This Tailors’ Housing has during that time become popular among buyers from Deir-ez-Zor and Iraq. However, not all of them appear to be civilians. An informed source in Qudsaya told The Syria Report that he had identified one of the Iraqis residing in the housing cooperative area as a member of the Iraqi militia “Harakat Hezbollah al-Nujaba”, which is affiliated with the Iranian Revolutionary Guard Corps (IRGC) and has fought in various parts of Syria against the opposition, especially in Aleppo. Some residents reportedly often visit the military area in Al-Hameh, which is used as a base for pro-IRGC militias. According to the correspondent, some of the new residents of the cooperative are from the Deiri family of Al-Marsouma, some of whom live in the nearby Rural Damascus cities of Jdeidat Al-Fadel and Moadamiyat Al-Sham. 

Nobody has yet reported any fraud, manipulation, pressure or use of force in purchasing apartments in Qudsaya, the correspondent added. The real estate brokers reportedly avoid seized properties that are owned by opposition members, and do not offer them to new buyers.

https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png 0 0 Rand Shamaa https://hlp.syria-report.com/wp-content/uploads/2022/07/Logo-300x81.png Rand Shamaa2023-06-14 14:24:092023-06-14 14:24:09Buyers from Iraq and Deir-ez-Zor Purchase Homes in Qudsaya, Rural Damascus

Explained: New Judicial Fees Law Adds Financial Burden to Real Estate Lawsuits

14-06-2023/in Analysis & Features, HLP /by Rand Shamaa

In April, Syrian President Bashar al-Assad issued Law No. 6 of 2023 regarding court fees, insurances and litigation expenses, replacing the old court fees law, No. 1 of 2012, and its amendments, which were released in Law No. 38 of 2014. The provisions of Law No. 6 2023 were put into force starting May 1, 2023.

Law No. 6 raises the fees imposed on legal transactions in general, and real estate-related lawsuits in particular. These fees remained constant under the previous Law No. 1 of 2012, despite the depreciation of the Syrian pound in recent years. However, the new law came with numerous complexities concerning housing, land and property rights. It also imposed additional financial burdens on citizens amidst Syria’s deteriorating economic conditions.

Court transaction fees are those collected by the public treasury for the tasks performed by various judicial departments, including registering a lawsuit, extracting a judgment and executing it. Judicial insurance fees are those paid by people who challenge a judgment, including fees for appeal and cassation. Litigation expenses are all costs paid by the parties during the lawsuit, including expert fees, court travel expenses and legal fees.

Article 24 of Law No. 6 stipulates that fees are to be calculated based on the current value of the property at the financial departments, in all matters related to real estate ownership lawsuits, as well as when dealing with Amiri lands, and usufruct and ownership lawsuits.

Real estate ownership lawsuits are those that focus on property ownership, including lawsuits confirming real estate ownership in which the seller acknowledges the sale of the property to the buyer, so the buyer may obtain a judicial ruling confirming their property ownership. There are also lawsuits concerning property disputes, initiated when a conflict arises over property ownership. Each party presents its evidence and defences before the court supporting their ownership.

Lawsuits over Amiri lands are cases filed by someone in possession of such property who takes over a piece of Amiri agricultural land and cultivates it. After 10 years, they then have the right to confirm their ability to dispose of the property. 

Usufruct and ownership lawsuits, on the other hand, occur when someone transfers the usufruct, or the right to use and profit from a property, to another person while the seller retains the actual ownership.

Article 24 of Law No. 6 sets the fee rate at 0.01 of the property’s current value for all the above types of lawsuits, without distinguishing between them. This is contrary to the older, nullified law, which imposed a half set fee for lawsuits concerning acknowledgment of ownership and lawsuits concerning usufruct and reversion, compared to real estate dispute lawsuits and Amiri land handling lawsuits.

The new 0.01 rate is a considerable sum, considering the increase in property values. Thus, the new law’s imposition of high fees on real estate ownership lawsuits, regardless of the lawsuit type, may deter some people from resorting to the judiciary to establish property ownership.

Financial departments now rely solely on the current values of properties, with the assistance of committees, following the issuance of the Real Estate Sales Law No. 15 of 2021. The current value was not applied in the old court fees law, which calculated fees for real estate ownership lawsuits based on the value set for the property in the financial departments, a fixed sum that does not reflect the property’s actual value.

The new law requires half of the set fee (or 0.005 percent the property’s current value) to be paid when registering the lawsuit, and the other half when the judgment becomes final. This is also a new step not previously stipulated in the old law, which stipulated that the fee be paid upon the issuance of a ruling by the court of first instance. This new amendment may delay the registration of real estate ownership lawsuits, potentially opening the door for manipulation through committees and loss of owners’ rights. 

Since the current values of properties in many real estate areas are yet to be appraised, this new measure requires a preliminary Real Estate Appraisal Committee in the financial departments to assess the property value based on the land area statement and the subdivision plan kept in the Land Registry, as well as physical inspection of the property to note any changes in its characteristics. Therefore, a long time might pass between the registration of the lawsuit and the issuance of the judgment, which could mean a change in the prevailing property value between the two steps and, as a result, a discrepancy in fees.

The fees imposed on property lawsuits under the new law increases the financial burdens on property owners in general. This is on top of the tax imposed by the Real Estate Sales Law No. 15 of 2021 on property ownership transactions. It also includes the annual tax on all properties and constructions of different types, whether fully or partially constructed, for residential, commercial or industrial purposes, as imposed by Real Estate and Building Plots Income Tax Law No. 53 of 2006.

Here it is essential to differentiate between court fees and property taxes. The tax is imposed on the taxpayer as a final obligation without receiving something in return, unlike the fee, which incurs some benefit onto the payer. Furthermore, the objective of imposing the tax is to achieve certain economic, social and financial goals, whereas the fee aims to generate revenue for the treasury.

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Explained: Executive Instructions for Decree No. 3 on Earthquake Victims

11-04-2023/in Analysis & Features, HLP /by Rand Shamaa

In early April, the Ministry of Finance issued executive instructions for Legislative Decree No. 3 of 2023, which grants tax exemptions to people affected by the February 6 earthquake. Some of the exemptions are related to entirely or partially destroyed properties.

Notably, the executive instructions procedurally violate property and housing rights, as they do not provide any mechanism for absentee property owners in affected areas to benefit from the exemptions stipulated in Decree No. 3. This is despite the fact that it could have been possible to allow the relatives of the absentee owners, or their legal representatives, to submit documents or licensing requests on their behalf. Failure to include such a measure prevents absentee property owners, including those forcibly displaced from their homes, those wanted for security reasons, or detainees and missing persons, from benefiting from the decree.

Decree No. 3 included exemptions for damaged properties from some taxes and fees and granted owners temporary exemptions from future taxes. It also eased obtaining loans to do restoration work on damaged properties. The executive instructions were limited to providing wide-scale, detailed explanations for the tax exemptions included in the decree. It detailed the procedures of forming and running the committees tasked with identifying which owners and damaged properties could benefit. 

Article 2 of Decree No. 3 stipulated the formation of a committee to identify those affected by the earthquake in each impacted province. The executive instructions clarified the committee’s tasks: to identify properties numbers in the affected areas, whether they are commercial establishments, homes, or buildings that were completely or partially destroyed; describe the damage or destruction; determine the building’s occupancy status, identify its use (residential or commercial); and list the owners’ names, property documents, occupants’ names, and their legal documents. In other words, the inventory and description committee’s tasks are identifying, counting and describing the impacted properties.

Owners of damaged properties must submit their official documents to the committee, in addition to a police report proving damage to their property and a certified record from the public safety committee operating in that governorate. The committee then prepares a record of its work, and the governor issues lists of the affected property owners via a decision. 

The executive instructions for Decree No. 3 allowed those whose names are not included in these lists to submit applications to their governorate within 90 days. The same committee then reviews these names and can reject them with reason. However, the instructions did not stipulate that people could appeal these rejection decisions before a special independent committee, contrary to the legal procedures followed in a usual appeal process.

Meanwhile, people whose names appear in the lists have until the end of 2024 to submit applications for construction and renovation permits from their local administrative units. Each permit includes information about the property owner, property number, real estate area, accurate work details, and the time needed to complete it. With those items submitted, the applicant can benefit from the exemptions mentioned in Decree No. 3. 

The decree does not exempt people impacted by the earthquake from paying the real estate sales tax stipulated in Real Estate Sales Law No. 15 of 2021. However, it does exempt such taxes if the sales transaction took place before the implementation of Law No. 15. Meaning that an official must document the sales deed before Law No. 15 came into effect. In essence, this stipulation implies that the property owners affected by the February 6 earthquake must submit official documents (such as a property financial clearance certificate issued by the finance department) that were certified before the enforcement of Law No. 15. The owners may instead provide certified copies of the financial records approved by the tax authorities if the documents were lost during the earthquake.

Finally, according to the executive instructions, rental transactions of properties in earthquake-affected areas are exempt from fees usually charged by administrative units under the Financial Law of Administrative Units No. 37 of 2021.

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