Primary and brief practical approach to the civil law aspects
(Preliminary draft law amending the 8/2012 Law, of July 19, relating to tourism in the Balearic Islands, concerning the marketing of tourist accommodation)
0.- IS IT APPLICABLE NOW?
No. It is only a preliminary draft that must be approved by the Governing Council and then go through the parliamentary process, so it could be several months before it comes into force and it could also be modified during this process. Until it is approved, the previous regulation applies (for which we refer you to our previous post).
1.- GENERAL RULE
The general rule is that it is only possible to commercialize housing subject to the (Commonhold) Horizontal Property Act if this is expressly permitted by the master deed or the statutes of the Community of Owners.
If the master deed or community statutes do not permit it, agreement of the majority of owners (who must also constitute the majority of the quotas of the property) will be required.
2.- HOW CAN WE CONSULT THE STATUTES AND / OR THE MASTER DEED?
Community statutes. Firstly, it should be noted that not all communities of owners have statutes, because they are optional, not mandatory. (In fact, many communities do not have any statutes, or only have a specific few). If there are no statutes, then the Horizontal Property Act applies.
How can we know if there are statutes? The easiest way is to ask the property administrator, if you have one. If there is no property administrator, you can ask directly at the Registro (Property Registry) of the property.
Often the statutes are included within the master deed of the property, which can also be found at the Registro (Property Registry).
3.-HOW CAN THE STATUTES OR THE MASTER DEED BE CHANGED?
Whilst it may be possible to change the statutes to expressly permit or prohibit tourist rentals, this is not easy, because unanimity of all owners is required to amend either the master deed or the community statutes.
4.- WHAT DOES MAJORITY OF OWNERS AND QUOTAS MEAN?
The preliminary draft law requires that a majority of owners vote in favour, but this majority alone is not sufficient, these owners also have to hold the majority of quotas. Each owner has a percentage quota, a share in the commonhold of the property.
The intention of this condition is to avoid majority abuses. Thus an individual owner of a very large single apartment with a very high quota, cannot make unilateral decisions. And conversely, a group of owners of small apartments cannot make decisions to the detriment of owners who, although they are less in number, have a high share of quota.
5.- WHAT HAPPENS IF AN APARTMENT OWNER RENTS TO TOURISTS WITHOUT THE AGREEMENT OF THE COMMUNITY OF OWNERS AND WITHOUT THE STATUTES PERMITTING IT?
According to the preliminary draft, this is not permitted.
From the civil perspective, if the rental was prohibited by the statutes, it would be possible to claim that the owner is carrying out an activity prohibited under article 7.2 of the Horizontal Property Act and request the judge to order that the activity cease, award compensation for damages and deny the use of the accommodation for up to three years. Nonetheless the interpretation of this precept will be subject to jurisprudence.
6.- AND IF I BUY AN APARTMENT, HOW CAN I KNOW IF THE COMMUNITY OF OWNERS HAS AGREED TO PERMIT TOURIST LETS?
The preliminary draft has no provision in this regard and this may result in a lack of protection for the consumer who buys a home unaware of this circumstance that may be relevant. It would be necessary to amend this situation and contemplate the possible inclusion of these agreements in Property Register documentation.