Overview of major changes to the Construction Law
In 2022, the Polish parliament introduced a number of significant changes to the Construction Law. The most important of these are related to further digitalisation of administrative processes in construction. The amendment introduced the ability to maintain a daily construction log and site book in electronic form, as well as an electronic central register of licensed builders. The administrative procedures have also been simplified for construction of single-family houses with an area of up to 70 m2, and new obligations for the energy performance of buildings have been implemented.
Legislative work aimed at phasing out the right of perpetual usufruct is underway
The government’s draft reform of perpetual usufruct in Poland focuses on changing the rules and method for determining the price for sale of a property to its perpetual usufructuary. Additionally, perpetual usufructuaries are granted a claim to acquire the property they hold. This is part of the process of phasing out perpetual usufruct entirely.
Lease agreements in the private rented sector
More and more residential tenants recognise the advantages of institutional leasing over renting from private individuals, due to the security and stability of the lease relationship, the attractive standard of the units offered, and the package of property management services. The question is what type of agreement to conclude in such a lease relationship.
Deed submitting to enforcement in an institutional lease agreement
In recent years, there has been a notable revival in the residential lease market in Poland, and thus an increase in the interest in lease property investments also among foreign investors in the private rented sector (PRS). In response, the Polish parliament has introduced a number of new provisions on lease agreements. One such change was the introduction in 2017 of the institutional lease agreement, which is designed specifically for use by businesses letting residential premises in the private rented sector.
The planning gap: Change of the rules for determining compensation and planning fees
On 7 January 2023, provisions came into force in Poland amending the rules for determining the value of real estate in the case of adoption of a local zoning plan after a “planning gap.” Will they affect property owners, and to what extent?
The housing cooperative: A new approach for implementing residential projects
On the residential construction market in Poland, currently dominated by real estate developers, housing cooperatives can begin building starting 1 March 2023, when the new Housing Cooperatives Act enters into force, introducing a framework for their activities and providing incentives for such grassroots construction initiatives.
The investor’s lack of cooperation and rescission of a construction contract
Cooperation between the parties is essential to implement many contracts. This is particularly so in the case of a construction contract or a contract to produce a specific work, where the purpose of the contract is achieved over the course of a fairly complex process and comprises many elements. The Polish parliament has recognised this strong dependence and has provided a far-reaching solution applicable when the necessary cooperation is lacking. Such a situation may even lead to rescission of the contract.
The Electronic Construction Daily Log
The introduction of an electronic construction daily log is the next step in the digitalisation of the construction process.
Public Roads Act: More administrative decisions are transferrable
As of 29 June 2022, the rights and obligations under three types of decisions issued under the Public Roads Act can be transferred to another entity. These are decisions permitting the location or reconstruction of an exit from a public road; placement of devices and advertising in a right of way; or occupation of a right of way for purposes not related to construction, reconstruction, repair, maintenance or protection of roads.
Does the bank have to re-audit the development venture when a buyer makes a late payment?
Effective as of 1 July 2022, the new Developers Act expands the scope of bank oversight of development ventures before paying out to the developer the funds due for a given phase of the project. But the regulations are imprecise, and it is unclear whether the bank must redo the audit when the buyer has made a late payment of funds into an open housing escrow account.
The new pre-emptive right and other regulations on revitalisation in Warsaw
A major new element has recently emerged in real estate transactions in Warsaw. As of March 2022, the City of Warsaw obtained a pre-emptive right to purchase all properties in the revitalisation area designated by Resolution LX/1967/2022 of the Warsaw City Council. This area includes almost all of the Praga Północ district and large parts of Praga Południe and Targówek.
Acquisition of forest land and the powers of the State Treasury
Poland’s Forest Act significantly interferes with trading in forest land. This raises the question of which legal actions causing the transfer of ownership in forest land trigger a right of the State Treasury to acquire the land.