Parliament has passed the Landlord and Tenant Bill, 2018 that seeks to among other things regulate the relationship between landlords and tenants.
The bill was passed with several amendments which relate to duties and rights of landlords and tenants in rented commercial and residential premises. Among the key provisions is that landlords and tenants must sign tenancy agreements for rent transactions of over Shs 500,000 with clear terms and conditions.
Also, tenancy disputes shall be handled in a Local Council court and other courts of law. It also states the landlords can only evict tenants after securing court orders to do so. Unlawful evictions attract a penalty of Shs 5 million or jail term of one year or both upon conviction. MPs also approved the provision that landlords must give tenants an eviction notice of six months. The bill also stresses that the landlord must notify the tenant about plans to increase rent in at least 90 days.
However, the most controversial provision is that all rent shall be settled and recorded in shillings, contrary to the initial proposal that parties can agree to transact in any other currency in the agreement. Trade, Industry and Cooperatives minister, Amelia Kyambadde and Health state minister, Sarah Opendi clashed on the floor with the General Duties state minister in Finance, Gabriel Ajedra over the issue.
Ajedra argued that the law shouldn't restrict transactions in shillings alone because some tenants such as foreign embassies pay landlords in foreign currency, a proposal that was squarely rejected.
"We have foreign embassies in this country that rent properties from Ugandans and the way they pay for it, is that they pay a fixed sum of rent every month, every year and those sums are budgeted by their respective countries. They don’t take into account the fluctuations of the local currency in these countries…it is only fair that we have provisions for both the local and foreign currency." Ajedra said.
However, Kyambadde and Opendi led the group of MPs who shot down Ajedra’s proposal
"Is it in order for the Hon minister who is supposed to be promoting Ugandan currency to come here and try to tell us about the dollars aware that we’ve had challenges in this country? Most of our tenants are being exploited because of this issue of dollars." Opendi said.
Likewise Kyambadde said; "Uganda is a sovereign state and I think we need to strengthen our currency, we’re advocating for local content then I think we need to be consistent. Two, my colleague in finance should be protecting our currency."
Given the way the ministers disagreed, speaker Rebecca Kadaga even wondered whether the bill was first discussed in cabinet to which
Tororo North County MP, Annet Nyakecho, Bokora County MP, Terence Achia Naco and Guster Mugoya, the Bukooli North County also supported Kyambadde on the need to restrict rent transactions in shillings.
Some of the provisions that have been deleted in the bill include repealing the Distress for Rent (Bailiffs) Act, 1976. Lands minister, Betty Amongi explained that the Uganda Law Reform Commission advised government against abolishing the Act because it has been used by landlords to recover rent from defaulting tenants.
Amongi lauded MPs for passing the bill, which was first mooted in 2012 and subjected to consultations involving landlords, tenants, property developers. The bill was tabled before parliament February this year. The bill now awaits presidential assent.