Romanian law is pro-landlord
July 20, 2006
The situation would be judged strongly pro-landlord, but for the practical ineffectiveness of the court system.
Rents: Can landlord and tenant freely agree rents in Romania?
No rent control exists in the private sector. Rental amounts can be freely negotiated between landlord and tenant. The rent can be indexed to inflation; such clauses are common. Progressive annual increases in rent can be lawfully stipulated in the contract.
Failing this sort of clause, the rent can only be increased if the contract’s duration is greater than one year. In the case of contracts above a year, the landlord may go to the courts to ask for an increase, citing a practical reason, such as (e.g.) a large unforeseen depreciation in the national currency.
Parties may agree on deposits, which must be held at the landlord’s bank, as agreed in the contract. At the end of the contract, the landlord may deduct expenses for repairs or works incumbent on the tenant, and for unpaid services.
What rights do landlords and tenants have in Romania, especially as to duration of contract, and eviction?
The agreement automatically terminates at the end of the contract, without need for further notice. In case of a contract unlimited in time, the Civil Code gives both parties the right to cancellation, under the condition of the observance of time limits imposed by local customs.
The contract can be terminated before the agreed term by the tenant with a notice of a minimum of 60 days, or by the landlord if:
- The tenant did not pay the rent for three consecutive months
- The tenant did not comply with the contractual provisions
Tenants may only sublet with previous written permission from the landlord, and under the conditions set by the landlord. Sub-letting can be expressly forbidden in the contract.
EVICTION FOR NON-PAYMENT OF RENT
|Duration until completion of service of process||30|
|Duration of trial||140|
|Duration of enforcement||103|
|Total Days to Evict Tenant||273|
|Courts: The Lex Mundi Project|
How effective is the Romanian legal system?
Taking a dispute to the courts is possible, but will take 1.5-2 years. The courts are generally viewed with suspicion.
Under Housing Act Art 21., the contract must be registered with the local fiscal authorities, not in order for the contract to be effective, but in order to prevent tax-evasion.
The Housing Act (Law No. 114/1996) is the primary legislation applying to private housing stock not owned by landlords who were direct beneficiaries of the post-communist privatization (those landlords inherited the previous tenants, who were given security of tenure). The Housing Act is supplemented by Emergency Ordinance No 40/1999, which concerns protection of tenants. All legislation regarding landlord and tenant in Romania is state law, and there is no legislation at local level.