Constitutional Court: no ban on daily rent, no permits either
Now the district courts, considering disputes about the legality of short-term lease, reports
On March 23, the Constitutional Court of the Russian Federation issued a ruling on the case of short-term rental of housing in apartment buildings. Sole proprietor Pavel Bakhirev asked that Part 3 of Article 17 of the Housing Code, which prohibits the use of apartments in MKD for the provision of hotel services, be declared “unconstitutional”.
The court noted the «ambiguity and inconsistency» of the existing norms and law enforcement practice and suggested that legislators «comprehensively regulate» the features of short-term employment.
Brief background. Pskov businessman Pavel Bakhirev bought an apartment in the center of Pskov, registered an individual entrepreneur and rented an apartment by the day, advertising it as a “two-level apartment”, with food and drinks, a shuttle to the airport, etc. The neighbors went to court; courts of all instances forbade the use of the apartment «for the provision of hotel services», the Supreme Court did not consider the case.
Pavel Bakhirev appealed to the highest authority, pointing out that the ban violates his constitutional rights: to freely dispose of property (housing) and derive income from it. Bakhirev’s statement was supported by the Prosecutor General’s Office.
The decision of the Constitutional Court takes 25 pages, we give the arguments in brief. The court, chaired by Valery Zorkin, did not recognize the controversial article of the LCD (it appeared in the code after the adoption of the «Khovanskaya law», in defense of the interests of residents) «contradicting the Constitution.» But he analyzed in detail the practice and interpretations. The Constitutional Court noted that there is no definition of “short-term rent” in the legislation — you can rent out housing for at least a day, at least for five years (maximum). Here, hourly rent can already be considered a violation.
There is no formal distinction between «stay» and «residence». The CC also noted that the provision of certain services from the “hotel set” specified in the orders of Rosstandart or the Rules for the provision of hotel services in the Russian Federation does not yet make an apartment a hotel. As well as the use of the term «apartment» or «room» in advertising. Also, the Constitutional Court urged not to consider the fact that the apartment is used “for business activities” as an indisputable argument in litigation — this is not prohibited, for example, for long-term rent.
In general, the position of the Constitutional Court is humanly understandable and even (which is a rarity in recent times) meets the criteria of common sense: situations are complex, one case is not like another, and lower courts should evaluate the totality of facts, and not individual formal signs. The CC even recalled that ordinary residents sometimes make noise and have fun, and also call for delivery by letting strangers into the entrances. On the other hand, the presence of staff or the division of the apartment into an “excessive” number of beds can serve as important arguments.
In addition, a formal ban on «short-term» will deprive thousands of citizens of an additional source of income, and also contradicts the goals of developing domestic tourism.
Essentially, the conclusion is: “Regulatory regulation does not predetermine the need to interpret any actions and proposals of the owner to the tenant of housing, similar to hotel services, as a set of legal facts that makes it possible to assert that hotel services are provided in an apartment building, which is prohibited by part 3 of article 17 of the Housing Code of the Russian Federation.”
The Constitutional Court proposes that short-term rentals be subject to an injunction in cases where, apart from formal signs, there are others: if other tenants “are caused inconveniences that are significantly greater than those that occur during the normal use of the premises.”
And now the district and magistrate courts will determine whether it is “essential” or “insignificant”. Which is unlikely to make the practice more understandable. On the other hand, entrepreneurs and landlords themselves receive a set of arguments that will allow them to more effectively defend their position in the event of claims. The position of the Constitutional Court will have to be taken into account in each such dispute.
The decision on the “Bakhirev case” is subject to review, the case will be sent back to the Pskov court.
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