The Plenary of the Constitutional Court (TC) has partially upheld by unanimity the unconstitutionality appeal filed by the PP against the Law 11/2020 of Catalonia, which capped residential lease contract prices, considering that it encroached upon the State's areas of competence.
According to forecasts, said Constitutional Court ruling, which declares the unconstitutionality of the Rent Containment Law, could still take a month to be published in the BOE, from which moment it would become effective.
Specifically, the judgment declares null and void Articles 1 (purpose and scope of application of the regulation), 6 to 13 (determination of rent, reference price, rent updating, renting of new flats, works, or the mandatory inclusion of the price in advertisements) 15 and 16.2; the first, second and third additional provisions; the first transitional provision and the fourth final provision, point (b); the fourth additional provision and the third final provision.
According to the Constitutional Court, these provisions represent an “invasion by the autonomous community into the State's powers” in civil matters regarding the regulation of contractual bases, given that Article 149.1.8 of the Spanish Constitution grants it the authority to establish the criteria for organising the private contracting sector in those autonomous territories that have their own legislation.
In its ruling, it does not address the constitutionality or otherwise of setting limits on rental prices, but it does deny that an autonomous community, in this case Catalonia – which has its own regional civil law –, can regulate this matter.
Catalan legislation required the freezing or reduction of rent prices in areas with residential “stress” across the 60 Catalan cities with more than 20,000 inhabitants, although “vulnerable” landlords earning less than 2,000 euros a month were exempt. The appeal was lodged by the PP parliamentary group in 2020.
The effects of the judgement will take effect in the future and will not be retroactive, so rental agreements prior to this ruling will maintain their conditions.