Investors' most pressing concerns not addressed
The amendment proposed by the government to the draft of the Law on Land Management may be divided into two groups. One specifies and precisely describes the existing provisions, in order to eliminate divergent interpretation and simplify their application, while the other concerns suggestions about new legal regulations which have been found essential
General provisions
The amendment proposes discontinuing the enforcement of an administrative
decision in case it is appealed against before the Supreme Administrative Court.
It shall be discontinued ex officio in the form of a decision against which
there shall be no appeal granted. In the opinion of the authors of that
amendment, this change is necessary because of its financial and legal effects
on the involved parties, who will be compensated if decisions are dismissed by
the court.
Another essential change indicates that it is the voivode who is superior in
relation to the chief official of a district (starosta). Ambiguities in this
respect have occurred due to the provisions of the Code of Administrative
Proceedings. The provisions stipulate that the Local Appeal Board (Samorzadowe
Kolegium Odwolawcze) is the superior body in relation to local government units,
irrespective of whether they perform their own activities or those sanctioned by
the government. Such a body is de facto the chief official of the district.
However, due to the specific authorization given to him under the described Law,
he is competent for managing The State Treasury real estate, which is a
governmental assignment.
Public real estate management
Among the proposed amendments, it is worth highlighting provisions which
accurately define the following: the manner in which tenders for the sale of
public real estate are executed, the terms of tender procedures and the manner
of the sale of real estate following two failed tenders. The method of
establishing a starting and transaction price, as well as rendering and claiming
the return of price discounts or transferring public real estate for the
perpetual usufruct, have also been defined more precisely.
The changes to the competences of the administrative authorities define more
accurately the scope of their activity: they may represent public owners (The
State Treasury or local government units) in all actions undertaken for the
benefit of, and on behalf of, those entities. Nowadays, the representation,
referred to in Article 11 of the Law, is interpreted only in relation to real
estate belonging to The State Treasury or local government units. Practical
experience shows, that there is a requirement to ensure that the property of The
State Treasury and local government units should be safeguarded. It also
concerns matters connected with such real estate, which has not yet been
acquired by those institutions but in which they have a legal interest.
The authors of the draft propose enhancing control over the use of real estate
which is transferred in the form of a donation. They want the consent of the
voivode, competent council or regional body (sejmik) only to be required in
order to discontinue the revocation of the donation, when using the real estate
for purposes other than for which it was donated.
The proposed provisions include the possibility of establishing a permanent
management board on perpetual usufruct rights (and not only on those of
ownership), which will affect the manner of regulating the relationship between
an owner, a perpetual usufructer and a permanent administrator. This concerns,
in particular, such cases in which the entities, with none of the status of a
legal person, have purchased the perpetual usufruct and not ownership rights, on
behalf of The State Treasury or local government units.
List of real estate for sale
Within the new provisions, there is the idea of limiting the real estate for
sale. At present, such a list is obligatorily prepared by the relevant authority,
not only in relation to the sale of real estate but also when it is transferred
for usufruct or leased. However, practical experience indicates that the
obligation to draw up a list should be limited to agreements to transfer
ownership of real estate, agreements to transfer land for perpetual usufruct, as
well as agreements for use and lease concluded for longer periods of time (more
than 3 years). This list may serve as a guarantor of free access to real estate
turnover, only when covering the above types of agreements.
New rules of a real estate division
The purpose of the new rules is to enable the execution of local zoning plans as
well as the accomplishment of public projects such as infrastructure investments.
In order to accomplish these aims, the new rules of real estate division will be
applied. Provisions enabling the division ex officio of the real estate of
unregulated legal status, have been implemented. So far, if in order to execute
a public investment it was necessary to purchase part of some real estate,
involving a prior division of it, this was not possible where its legal status
was not regulated.
Right of pre-emption
The new rules extend the preemption right to all cases where a transaction of
the perpetual usufruct right takes place, notwithstanding the form in which this
was established. The authors of the amendment propose shortening the time of
waiting for the commune's decision concerning the preemption right (instead of 2
months it shall take 1 month. It will be solely the commune administrator, mayor
or president of a city who will make a decision concerning the preemption right.
Expropriation of real estate
The draft also includes a new regulation in the field of expropriation of real
estate. It shall enable dividing and expropriating real estate under one
procedure concerning the division and expropriation of real estate of an
unregulated legal status. It also defines the method of establishing and paying
damages for the expropriated real estate.
Appraising real estate
The draft includes and specifies the rules concerning the appraisal of real
estate by property experts. The definition of a cadastral value has been
corrected: it shall be established in the course of common taxation for the real
estate included in the cadastre. This measure will adjust the provisions to the
regulations included in the provisions on the land and buildings register (the
future real estate cadastre), under which the value of all the real estate
entered onto the land and building register shall be indicated.
Very important is the rule establishing the period for which the appraisal (cadastral
survey) may be used after it has been performed. As a rule, the person ordering
the survey needs some time to arrange certain issues related to the real estate,
for which the survey was required. On the other hand, the value of the real
estate determined in the survey is valid as long as conditions on the real
estate market do not change. The lack of this rule caused a cadastral survey, (serving
as evidence in the case for which it was prepared), to be rejected for formal
reasons. The date of issue appearing in the survey is "quite naturally"
sooner than the date on which actions related to the real estate were performed.
The proposed change shall eliminate such doubts, which have been raised in the
judgments of the Supreme Administrative Court.
Another essential regulation will be the provision concerning the evaluation of
prepared surveys. In existing law, this issue has already been resolved, though
not completely. At the moment, anyone questioning the surveys must order another
evaluation and in the event that a new one proves to be different than the first,
the evaluation of two surveys may then be requested. Such a procedure is useless:
it prolongs the time of handling the case and incurs additional costs.
***
The proposed amendments to the Law on Land Management are not of a revolutionary
nature but rather systematize the rules. They include modifications to the
administrative structure and accurately define the rules in order to eliminate
divergent interpretations. The authors of the amendment have not addressed
investors' pressing concerns about the real estate market, as they neither
facilitate the access to land, nor regulate the issue of settling infrastructure
investments.
Małgorzata Kacperska
The author of this paper is Partner in the law firm Drzewiecki, Tomaszek
& Co.