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edition 10 (224)
October 2017
Property management

Regulating deregulation

Regulating deregulation
Andrzej Piórecki, the president of the Polish Real Estate Market Federation

POLAND An amendment to the real estate management act has now come into force, introducing new regulations for real estate management professionals, including for real estate agents, facility managers and real estate appraisers. The new regulations also restore definitions for real estate management activities and the principles that facility managers and real estate agent must adhere to – provisions that were removed in deregulatory measures passed in the original 2014 act, which, as later became clear, led to severe negative repercussions for market players.

Order after a chaotic three years

“After three years of chaos resulting from the deregulation, the amendment re-introduces regulations for the professions of a real estate agent and appraiser once again,” comments Andrzej Piórecki, the president of the Polish Real Estate Market Federation. “I hope that this will be the beginning of the normalisation of the act and its subsequent provisions will be aimed at improving the situation of clients and the professionalism of agents and managers,” he adds.

The amendment, which came into force on September 1st, restores the definitions of agency and management that were problematically taken out of the act three years ago. According to the latest amendment, facility management entails making decisions and carrying out activities aimed at providing optimal economic and financial management, as well as taking on the responsibility for the appropriate use and security of the property and its power management, together with the maintenance of and justifiable investment in the property. Meanwhile, real estate agency now consists in the paid execution of activities by an outside party directed at concluding contracts regarding the sale or purchase of rights to properties or the joint-ownership rights to premises, the rent or the lease of a property (or its parts), as well as other contracts related to the rights to properties (or their parts).

The new regulations also introduce stiff penalties for managers and agents for not having legal liability insurance. Agents can now be forced to pay fines of between double and five times the average Polish monthly salary, as stipulated by GUS – the Polish Central Statistical Office (currently app. PLN 8,000–20,000). The sanctions for facility managers who have not taken out the obligatory insurance are even higher – from four to ten times the average monthly salary (PLN 16,000–40,000). The penalties are to be imposed by the trade’s ombudsman in the form of administrative decisions. Copies of the policies must be attached to management and agency contracts.

Important definitions

“An insurance policy is a very important document – for both clients and managers,” explains Leszek Hardek, an agent and Polish Real Estate Market Federation expert. “Legal liability insurance played an important role in this profession before, but when the controls were lifted there were no longer any sanctions for not being in possession of this,” he emphasises.

The amendment also lays down definitions for the professions of agent and manager – these are the individuals who are paid to perform the professional activities that are listed above, in an organised, continuous and regular manner. Following on from this the legislation now stipulates that a real estate agent or a facility manager can be a business owner, and that the professional activities that are mentioned above can be performed by other individuals on the basis of a contract drawn up with this business. In this way the legislator has limited the risk of professional people erroneously being counted as property agents or managers. One significant change for agents that has been introduced is that they now have the right to examine and make copies of extracts and certificates in the registers as well as of the documents related to the property the contract is concerned with.


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