KAMPALA: Landlord and Developers Association Leaders in Kampala have said they are not opposed to charging rent in local currency as long as it is an option in the Landlord and Tenant Bill, 2021.
The parliamentary panel on physical infrastructure is processing the Bill that was re-tabled because President Museveni declined to assent to it after it was passed last year.
The President raised worries with the translation of business and private premises, and issues to do with the meaning of nuisance between occupants involving various premises. Landlords led by Sudhir Ruparelia and Godfrey Kirumira appeared before the committee where they advocated a win-win situation with the tenants.
With the unending tension with tenants over separates charging for utilities, the landlords proposed that a provision be put in the law for service providers to deal directly with tenants.
Ruparelia told the committee that top sort out the challenge, tenants need to be provided each with prepaid electricity and water bills.
“We want a law that can harmonise both landlords and tenants, however, it is a constitutional requirement that the government is the sole provider for utilities of power and water. But Umeme does not provide our building with more than one yaka prepaid meter, this is a dilemma. Over 250 tenants will abscond from payment of power and water since NWSC also installs one meter on a building, Ruparelia said.
The Committee vice chairperson Robert Kasolo asked the landlords to explain why they have been asking for rent in foreign currency (US dollars), which posed a challenge to tenants when exchange rate rises.
When the bill was passed last year, it was provided under clause 23 that tenants shall pay rent only in Ugandan shillings, as per Kampala City Traders Association-KACITA demands.
Ruparelia said landlords have no problem with tenants who may want to pay their rent in dollars along as it is an option provide in the law.
“There are some foreign tenants who prefer payment of rent in dollars. Therefore the clause needs to be recast to accommodate alternative agreement of the parties,” he said.
The landlords, who argued that Uganda is a free market economy said they sometimes acquire loans from foreign banks in dollars and other foreign denominations that are based on the analysis of foreign currency rental income streams.
MPs Maurice Kibalya and Sarah Opendi said paying rent in the local currency will strengthen the Uganda shillings against foreign currencies, which also eases pressure on Ugandans who go through a lot to start businesses.
Also raised by the MPs is the tenants concern on some landlords that issue receipts with the amounts less than what is actually paid every month something that leads to under declaration of rental income.
“We have a system in our company (Meera Investments) for the last 20 years, any tenant who comes must go and pay in the bank and we issue an invoice which is taxed by URA,” Ruparelia said.
Kibalya said; “I want ask the leaders of the landlords to instil good discipline into other landlords.”
In response, Kirumira said, “this law will sort those bad landlords out because human beings are not the same. There are good and bad ones, but this law will sort them.”
The landlords also asked the MPs to put a provision to emphasize that all landlords shall not channel security deposits by tenants on paying for the costs of renovations and repairs on the buildings, but instead it remains to serve the purpose of rent arrears settlement.
Ruparelia and his colleagues maintained that the proposal to introduce criminal offences against the landlords should be dropped from the Bill because if passed as it is tenants will only be subjected to civil remedies.