Land property issues

The property rights in Tunisia are mainly:

- Ownership;

- Usufruct;

- Easements;

- Real estate securities (mortgages, etc.)

• Ownership (or freehold property)

Ownership gives full rights over the property. It ownership is acquired by contract (sale, donation, contribution in a company, etc.), succession, occupation, prescription, accession or any other mode provided by law.

Land ownership prevails, unless otherwise provided by law (i.e. Mining Code, Hydrocarbons Code, etc.) or by the parties, the ownership of the top and bottom.

Please note that in addition to exclusive ownership there is also joint ownership (where individual units in the same building can be owned by different people).

A real estate owner can give non-exclusive rights to third parties to use his land, such as granting easements.

• Usufruct

The usufruct is the right to use and derive profit or benefit from a property which belongs to another person, as long as the property is not damaged. The usufructuary is entitled to natural benefits (those produced by either the property of those man-made) and legal benefits (rents, arrears, interests and similar). According to Article 150 of the Real estate Code, the usufructuary have the legal authority to transfer his right of the usufruct to third parties of his choice. The usufructuary shall, upon termination of the usufruct, claim no compensation for improvements he had made, although the value of the property was increased.

The usufructuary takes the property in the state where it is, and he shall, before entering into possession to make an inventory, in the presence of the bare owner (i.e. naked owner) or this latter duly summoned by a bailiff.

All ordinary expenses are borne by the usufructuary. However, the usufructuary is liable only for maintenance repairs. The major repairs remain the liability of the bare owner, unless they have been caused by the lack of repairs and/or maintenance.

The usufructuary is held to report to the bare owner any disturbance caused to the property or any infringement, otherwise he is liable for any damage that may result

Perpetual usufruct can be granted. The beneficiary can entirely use the property until his death.

• Easements

  • The easements are the rights to use a real property of another person without possessing it. An easement is considered as a property right in itself according to articles 165 to 190 of the Real Estate code (CDR). There are many kind of easement:

• 1. The easements of way,

  2. Easements of support,

  3. Easements of "light and air",

  4. Rights pertaining to artificial waterways.

  If registered, easements are binding on successors in title to the burdened and benefited land.

• Real estate securities

The mortgage follows the assigned property for each transfer of ownership. Creditors with a mortgage registered on land title of a property follow each transfer of property and are paid according to their registration rank. The mortgage extends to accessories and improvements of the mortgaged property.
The mortgage registration guarantee at the same rank as the principal loan, three (03) years of interest, provided, that the interest rate is provided by the mortgage deed and the registration.
If the price of the mortgaged property is insufficient to pay the mortgagees, they will apply, for the surplus, with the unsecured creditors.

It should be noted that pursuant to Article 278 of the Real Estate Code, the mortgage does not take effect until its registration at the land conservation office. It takes rank between the creditors.

For the non registered properties, the mortgage shall be mentioned in the property deed carried out by two public notaries.

- What rights do these titles grant to the holder? E.g. - is a leasehold right a contractual right only, or a right connected with the land itself?

• Ownership / Freehold property

The freehold property gives the owner the exclusive right to consume, sell, rent, mortgage, transfer, exchange or destroy his property, and/or to exclude others from doing these acts.

The owner is entitled to all the fruits and products of the property and what it incorporates, unless otherwise provided by law or by the Contract.

According to Article 20 of the Real Estate Code, no one may be forced to transfer his property except in cases provided by law (i.e. right of eminent domain) and with fair compensation.

• Lease agreement rights

• The principle: The leasehold right is only a contractual right.

According to Article 727 of the Obligations and Contracts Code (COC), the lease is a contract whereby one party gives up to the other party the right to benefit from a (movable) or real estate property, for a while, for a definite price that the other party shall pay him.

The owner has to guarantee the tenant's benefit from the leased property and ensure the defects of the promise.

Indeed, according to the provisions of article 748 of COC, the landlord shall refrain any act which would tend to disturb the possession of the tenant or to deprive him of advantages on which he is entitled according to the promise nature and state in which it was at the time of the lease agreement. The owner is liable not only for his facts and his employees' facts, but also for facts of other tenants, or legal successors.

The owner has the right to make, despite the opposition of the tenant; emergency repairs which cannot be postponed until the end of the contract. But if, because of these repairs, the tenant is deprived, in whole or in substantial part, of the use of the promise for more than three (03) days, he may request termination of the lease or a proportional reduction in the rent amount. The landlord is required to notice the emergency repairs to the tenant, otherwise, he may be held for damages resulting from failure to notice.

The article 750 of COC states that "the landlord is also held to guarantee the tenant from any eviction that he may suffer in all or part of the promise."

Exception: The leasehold right may become a right connected to the land in two cases:

- In case of commercial lease, after two (02) years of lease agreement, the tenant establishes a goodwill and will be entitled to renew the lease until the owner or new tenant pay him damages estimated on the basis of the goodwill value.

- The tenants of premises for housing, profession or public administration without commercial or industrial vocation the construction of which was finished before January 1^st, 1954 and the rent of which was granted before the promulgation of the law N°76-35 of February 18^th, 1976 are legally holed in places in spite of any opposite clause in the lease contract or any court order having the effect their eviction for end of lease. The tenant has obtained a preemption right (a priority to the purchase) and the owner shall notify his intention to sell the property and invite the long-term tenant to purchase the property.