#1. Legislative History

N. 1 Art. 109 BV goes back to the total revision of the Federal Constitution of 1999. The provision materially took over unchanged the former Art. 34septies and 34novies old BV, which had been incorporated into the Constitution through the popular votes of 5 March 1972 and 7 February 1986 (Rohrbach, mp 2/2014, 89 ff.).

N. 2 The introduction of the constitutional competence occurred as a reaction to the tense situation on the housing market in the 1970s. The Federal Council's message of 15 September 1971 (BBl 1971 II 1429) emphasised the necessity of effective protection of tenants as typically the weaker contracting party. The later supplement of para. 2 in 1986 was intended to create an additional instrument for combating housing shortages (BBl 1985 I 1389, 1401).

#2. Systematic Classification

N. 3 Art. 109 BV forms together with Art. 108 BV (promotion of housing construction and home ownership) and Art. 110 BV (protection of workers) the core of the federal social policy legislative competences in the economic sector. The provision stands in systematic connection with the general private law legislation according to Art. 122 para. 1 BV, but takes precedence as the more specific norm.

N. 4 In relation to fundamental rights, Art. 109 BV is to be interpreted in light of the guarantee of property (Art. 26 BV) and economic freedom (Art. 27 BV). The constitutional protection mandate legitimises restrictions of these fundamental rights insofar as they are proportionate (BGE 146 I 70 E. 6).

N. 5 The competence according to Art. 109 BV is a comprehensive federal legislative competence. It completely displaces cantonal legislative competence in the area of tenancy law insofar as the Confederation has made use of its competence (→ Art. 49 para. 1 BV; BGE 149 I 25 E. 4.3).

#3. Elements of the Offence / Normative Content

N. 6 Abuses in tenancy matters (para. 1): The concept of abuse encompasses according to doctrine factual situations in which one contracting party acts against good faith or exploits its superior position to create a disproportion between performance and counter-performance (→ Art. 5 para. 1 CC). The Constitution names two qualified abuse offences by way of example («in particular»):

N. 7 Abusive rents: This includes rents that stand in an obvious disproportion to the counter-performance. The concrete implementation occurs through Art. 269 ff. CO, which provide various valuation methods. According to case law, the parties may choose between the yield criterion and local or neighbourhood customary practice, but may not invoke both criteria cumulatively (BGE 150 III 123 E. 4.2).

N. 8 Abusive terminations: These exist when the termination violates good faith or leads to inequitable results in cases of hardship. The specification is found in Art. 271 ff. CO (Lachat et al., Das Mietrecht für die Praxis, 8th ed. 2010, N. 10.1 ff.).

N. 9 Limited extension: The Constitution empowers the introduction of social protection against termination through time-limited continuation of the tenancy relationship despite lawful termination. This was implemented in Art. 272 ff. CO (SVIT, Commentary, 3rd ed. 2008, Art. 272 N. 1).

N. 10 Declaration of general applicability of framework tenancy agreements (para. 2): This competence introduced in 1986 makes it possible to declare framework tenancy agreements negotiated between tenant and landlord associations generally applicable. The requirements are cumulative:

• Appropriate consideration of justified minority interests
• Observance of regional differences
• Safeguarding of legal equality

The practical significance has remained limited; so far only two declarations of general applicability have occurred (Roncoroni, mp 1/2004, 1 ff.).

#4. Legal Consequences

N. 11 Legislative duty: Art. 109 para. 1 BV establishes a constitutional duty of the Confederation to enact protective provisions. This duty was fulfilled through the tenancy law provisions of the CO (Art. 253-274g CO) and flanking procedural regulations.

N. 12 Precedence of federal law: The comprehensive federal legislation in tenancy law excludes cantonal regulations that directly intervene in private law tenancy relationships. Public law measures for housing promotion remain permissible insofar as they do not undermine federal private law (BGE 149 I 25 E. 4.4.5; BGE 146 I 70 E. 5).

N. 13 Direction of protection: The norm primarily aims at protecting the tenant as regularly the weaker contracting party. However, this does not exclude protection of the landlord from abusive behaviour by the tenant (Permann, Commentary on Tenancy Law, 2007, Intro. N. 32).

#5. Disputes

N. 14 Scope of federal competence: The scope of the federal law's preclusive effect is disputed. While one view in the literature assumes a comprehensive displacement of cantonal competences in the entire area of tenancy law, parts of the doctrine advocate a more differentiated view. Higi (ZK, Die Miete, 3rd ed. 1994, Preliminary Remarks N. 201) and Lachat (Das Mietrecht für die Praxis, N. 1.4.2) acknowledge scope for cantonal public law insofar as it does not intervene in private law relationships.

N. 15 Valuation methods for rent abuse: The relationship between yield and comparative rent criteria is controversially discussed. The prevailing doctrine (SVIT, Commentary, Art. 269a N. 7) favours a right of choice for the parties. A minority opinion (Rossinelli, in: Bohnet/Wessner, 16th Seminar on Tenancy Law, 2010, 175 f.) advocates for cumulative application of both criteria for comprehensive abuse control.

N. 16 Social housing policy and private autonomy: A fundamental dispute concerns the tension between social tenant protection and autonomous contractual design. While part of the doctrine (Permann, Commentary, Intro. N. 45 ff.) advocates for a restrictive interpretation of the abuse offences, the opposing view (Lachat et al., N. 10.2.1; Rohrbach, mp 2/2014, 125) favours an extensive interpretation in light of the constitutional protection mandate.

#6. Practice Notes

N. 17 Delimitation of permissible municipal measures: Municipalities may enact provisions for affordable housing construction within the framework of spatial planning, as long as these do not directly intervene in existing tenancy relationships. Permissible are, for example, development plans with shares for affordable housing or promotional programmes with voluntary participation (BGE 146 I 70).

N. 18 Procedural aspects: In disputes in connection with Art. 109 BV, the mandatory conciliation procedure according to Art. 200 f. CCP must be observed. The joint conciliation authorities according to Art. 201 CCP form an important institution for low-threshold enforcement of tenant protection.

N. 19 Particularities in publicly subsidised housing: In housing subsidised with public funds, more extensive regulations are possible, including occupancy regulations and income limits. However, these must be introduced as unilateral contractual amendments according to Art. 269d para. 3 CO and must observe data protection requirements (Judgment 4A_82/2024, E. 3.3.4).

N. 20 International references: The interpretation of Art. 109 BV is to be undertaken in light of international obligations, in particular the UN Covenant on Economic, Social and Cultural Rights (Art. 11 UN Covenant I). This may be relevant in the specification of indeterminate legal concepts such as «abuse».

#Affordable Housing Construction and Municipal Provisions

BGE 146 I 70 (14 November 2019)

Municipal provisions for ensuring affordable rental housing are compatible with Art. 109 para. 1 BV, insofar as they do not violate federal law.

The Federal Supreme Court held that the provisions incorporated into the building regulations of the City of Bern to ensure a sufficient supply of affordable rental housing are compatible with the principle of the primacy of federal law under Art. 49 BV:

«The provisions incorporated into the building regulations of the City of Bern to ensure a sufficient supply of affordable rental housing are compatible with the principle of the primacy of federal law (consideration 5). They can be interpreted and implemented in such a way that their application is not fundamentally associated with unjustified interference with economic freedom or the guarantee of property (consideration 6).»

BGE 149 I 25 (19 December 2022)

Cantonal provisions that directly interfere with private law rental contracts violate the primacy of federal law under Art. 49 in conjunction with Art. 109 and 122 BV.

The Federal Supreme Court found that § 8a para. 3 lit. a of the Basel Housing Promotion Act, which provided for a blanket right of return for tenants after renovations, violates the primacy of federal law:

«The envisaged, blanket right of return is of a civil law nature and directly interferes with the relationship between tenant and landlord, which is exhaustively regulated by federal law. Repeal of the provision because it violates the primacy of federal law (consideration 4.4.5).»

#Abusive Rents and Contestability

BGE 150 III 123 (29 November 2023)

The constitutionally anchored competence under Art. 109 para. 1 BV includes protection against abusive rents through precise assessment rules.

The Federal Supreme Court stated in the context of challenging initial rents:

«The constitutionally anchored protection against abusive rents according to Art. 109 para. 1 BV discussed is not about assessing an initial rent to the nearest cent. Rather, an assessment based on appropriate evidence is justified (consideration 4.2).»

#Unilateral Contract Modifications in Tenancy Law

Judgment 4A_82/2024 of 19 August 2024 (ZMP 2024 No. 9)

Municipal rental regulations can be introduced as unilateral contract modifications under Art. 269d para. 3 CO if a legitimate public interest exists.

The Federal Supreme Court fundamentally recognised the admissibility of occupancy regulations and income criteria for publicly subsidised housing:

«There is a ground of justification according to Art. 31 para. 2 lit. a DPA. Data processing is necessary in direct connection with contract processing and therefore lies in the overriding interest of the appellant [...] as these are publicly subsidised housing units of public authorities (consideration 3.3.4).»

Judgment 1C_19/2018 of 2 March 2018

Traffic police orders in connection with renovation work do not directly affect Art. 109 BV, but show the importance of proportionate public measures:

«The challenged judgment represents a decision on provisional measures within the meaning of Art. 98 SCA. Appeals against such a decision can only challenge violations of constitutional rights (consideration 2.2).»

#Recent Developments

The case law shows an increasing differentiation between public law and private law instruments in tenancy law. While municipal provisions within the framework of spatial planning are fundamentally admissible (BGE 146 I 70), the primacy of federal law prohibits direct interference with private law tenancy relationships (BGE 149 I 25).

The delimitation between publicly subsidised and private law tenancy relationships is of particular importance. The Federal Supreme Court recognises more extensive intervention possibilities for the former, but always requires compliance with mandatory tenancy law.

However, judgment 4A_82/2024 also shows the limits of supreme court jurisprudence: The facts underlying the judgment were contrary to the case files, as contrary to the Federal Supreme Court's assumption, these were not publicly subsidised housing units. This illustrates the necessity of precise fact-finding in this complex area of law.

#Areas of Tension

Federal Law vs. Cantonal Housing Policy

The case law on Art. 109 BV reflects the tension between federal competence in tenancy law and cantonal or municipal housing policy objectives. While Art. 109 BV assigns the Confederation competence for regulations against abuses in tenancy matters, cantons and municipalities often strive for more extensive social regulations.

The Federal Supreme Court draws clear boundaries here: Public law provisions on housing construction are admissible (BGE 146 I 70), but direct interference with private law rental contracts is prohibited (BGE 149 I 25). This delimitation is not always clear-cut, as the complex facts in 4A_82/2024 show.

Proportionality and Protection of Fundamental Rights

Another area of tension exists between the realisation of social housing policy and the protection of fundamental rights such as economic freedom and the guarantee of property. The Federal Supreme Court requires careful balancing of interests and emphasises the necessity of proportionate measures.

Recent case law also shows the importance of data protection aspects in the enforcement of housing policy objectives. Even in the area of social housing, the principles of data processing must be observed.

Methodological Challenges

The case law on Art. 109 BV finally illustrates methodological challenges in applying constitutional competence norms in conjunction with ordinary law. The delimitation between admissible public law measures and inadmissible interference with private law requires a differentiated consideration of the respective regulatory context and the objectives pursued.