British Residents Society, North Cyprus - GOVERNMENT LIAISON DETAIL

GOVERNMENT LIAISON DETAIL

This page last updated 11/04/2007

	Detail
05/10/2004	Letter from BRS to Minister of the Interior, Lefkosa, TRNC Purchase of property by foreigners in the TRNC

Mr. Ozkan Murat

Minister of the Interior

Lefkosa

TRNC

5^th October 2004

Dear Minister,

Purchase of property by foreigners in the TRNC -

The proposed Leasehold legislation

I am writing to formally place before you the reaction of the British Residents Society to the draft legislation you propose to set before Parliament on the above subject.

In doing so, I would firstly like to place on record the Society's appreciation for your attendance at the meeting it organised on the 21st September 2004 at the L A Hotel. I feel sure it was of considerable benefit to all who attended since it clarified a number of issues of concern to the foreign community. I hope it was of similar use to yourself both in being able to gauge the strength of feeling this issue has raised and the very real concerns of the foreign community about it.

The Society , in its position as the representative voice of by far the major part of the foreign community, wish to bring to your attention the following general issues which it feels should be given due thought and consideration before proceeding further with the proposed legislation:-

i) Whilst sharing, without reservation, your Government's concern about the current rapid increase in land and property ownership by foreigners with its attendant undesirable inflationary and social consequences, the Society is far from clear how these legislative proposals can be used to improve the situation, particularly in the immediate future when the need will be most pressing. In its opinion a simpler and less draconian approach is initially required based on improving the enforcement of existing control mechanisms and perhaps introducing some amendments to them to further strengthen their effect.

Simply to improve the enforcement of existing planning regulations for example could do much to help control undesirable development. A more imaginative use of taxation policy to lessen the attractions of blatant speculation, some restriction on foreigners purchasing housing for commercial rental and the introduction of some minimum period of actual residence in Northern Cyprus each year are other possible options. Such action would be simpler to introduce, be much more acceptable to the foreign community and produce results more quickly.

ii) The proposed introduction of the widespread use of the leasehold principle into foreign property ownership, especially when, however long a leasehold period may be proposed, at the end both the property and the land is to revert back to Government ownership, is viewed with considerable resentment.

Contrary to the Prime Minister's recently expressed view, the leasehold principle is not something that has ever been widely practiced by the British and legislation now exists to make its discontinuance entirely possible in Britain. Indeed, in all developed democratic societies one of the freedoms most valued is the right to own land and property without constraint. Moreover, although the position of the TRNC Government viz-a-viz the EU is presently unclear, should this position clarify, it seems this legislation, as presently proposed, would be incompatible with that of the EU. Its application, therefore, to those foreigners living in the TRNC who had EU citizenship would become fraught with legal difficulties.

iii) A major concern underlying the whole of the proposed legislation is the effective date of its implementation.

In most, if not all, democratic states the constitution, either by law or convention, frowns upon the practice of introducing legislation that is retroactive. In the interests of fairness and equity it is obviously desirable that, whatever terms existing land and property owners have acquired their estates on, it should continue to be honoured. The Society would strongly urge the Government to adhere to this well established democratic principle and in doing so continue the protection of their existing rights to pass on their freehold either by inheritance or subsequent resale.

iv) In the narrower context of the proposed legislation itself there are a number of points of detail on which it is difficult to comment since insufficient information is currently available. These mainly relate to the terms of the leasehold - for example, will a ground rent be required and, if so, at what level of charge? What, if any, compensation will be payable at the end of the leasehold period? Will there be, as the Society in fairness believes should be the case, some distinction of treatment for present foreign freeholders with pre 1974 title deeds, either of foreign or Turkish origin? On these points of detail, and others like them, the Society would welcome the opportunity to provide an input as and when the situation becomes more clear.

v) Finally, there is the important matter of confidence within the foreign community

to consider. Proposals of this nature, representing as they do a very significant diminution of the rights of foreigners in the TRNC, are bound to cause concern and some uncertainty about their future here.

The Prime Minister himself, in a recent press interview, has publicly acknowledged the need to attract foreigners into the TRNC both to help stimulate its economy and to help promote its cause in the outside world. Unfortunately the proposals now being put forward are widely seen by the foreign community as running quite contrary to what appears to be his stated intentions. Inward investment is unlikely to be attracted where there appears to be some discrepancy between the Governments public pronouncements and its actions.

To conclude, the Society offers these comments in a genuine attempt to be helpful and constructive. It hopes the Government will receive them in the same manner and give due consideration to their content.

Yours sincerely,

(MRS. JULIA PRICE)

Vice Chairman

On behalf of The Chairman

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