BERLIN, Feb. 8 (Xinhua) -- German companies and investors offering flats for social housing purposes as part of their contractual obligations in return for loans from the German government are not required to do so for an unlimited period of time, the German Federal Court of Justice (BGH) ruled on Friday.
The BGH reversed two prior verdicts of German regional courts and declared the "temporally unlimited" obligation to rent out apartments for government-sponsored housing purposes to be "invalid".
This would also apply if the responsible local "municipality provided the private investor with low-cost building land for the construction of social housing", the BGH verdict reads.
The lawsuit was filed by a housing company from Hanover. In 1995, the company had received a subsidized loan from the municipality of Langenhagen for building 52 apartments. In return, the company granted the municipality occupancy rights for an indefinite period of time.
The plaintiff company sought to end the city's occupancy rights after 20 years in order to rent out the apartments on the market. However, the BGH judge stressed that the verdict did not include an immediate end to the social housing obligation.
"In case of doubt," the housing company would have to rent out the flats at a reduced rate and exclusively to holders of residence entitlement certificates at least for the duration of the granted loan, the BGH ruled.
Germany's highest court now handed back the case to the regional court in Celle, which has to determine the duration of the occupancy rights.
