On February 7, 2025, a draft bill on solutions to increase the availability of land for housing construction, also referred to as the "supply law" (hereinafter referred to as the "Draft" or "Act"), was published on the Government Legislation Center website. We wrote about the assumptions of this bill at the beginning of year #235. However, in today's article from the series "Tuesday Mornings for the Construction Industry," we would like to familiarize you with the specific assumptions of this bill.

The main goal of the solutions provided for in the Project is to eliminate barriers that hinder the implementation of housing investments (including increasing the supply of land for housing construction), and therefore they are of great importance from the point of view of the implementation of investments, including development investments.

Below we indicate the most important planned changes.

I. CHANGES TO THE LEX DEVELOPER ACT

The project envisages changes to the Act on facilitating the preparation and implementation of housing investments and accompanying investments.

First and foremost, the long-announced plan is to abolish the minimum number of parking spaces, currently set at 1.5 per residential unit . According to the Draft, this number could be defined in local urban planning standards. When adopting a resolution, the municipal council will not be bound by the statutory minimum number of parking spaces; instead, the number of spaces will be left to its discretion. Local governments will still be required to specify the number of parking spaces allocated for the investment in the location resolution.

We would like to point out, however, that the current indicator of 1.5 will apply to applications for determining the location of a residential investment submitted before the entry into force of the Act.

The project's authors also indicated that the minimum usable area for commercial or service activities that can be implemented as part of a residential investment will be abolished. Currently, it is a minimum of 5% and a maximum of 20% of the usable area of ​​the apartments.

Moreover, the obligation to provide a minimum share of publicly accessible, unfenced, developed rest and recreation or sports area within the biologically active area will be abolished.

II. INCREASING LAND SUPPLY

The project assumes the abolition of restrictions on the trade in agricultural real estate located within the administrative boundaries of cities and the waiver of the right of repurchase by the National Support Centre for Agriculture ("KOWR").

The main changes are to be: (i) extending the catalogue of lands excluded from the regime of the Act on Shaping the Agricultural System to include agricultural properties located within the administrative boundaries of cities, (ii) "unblocking" properties belonging to State Treasury companies and lands managed by the KOWR.

According to the draft, the minister responsible for construction, spatial planning, and housing will be able to seize properties from this resource free of charge, which can be developed for housing purposes, and then transfer them to the State Treasury, which is managed by the district head. The district head will be able to distribute this land to municipalities, according to local needs. Failure to complete the investment within five years, however, will result in the land reverting to the State Treasury.

III. CHANGES IN BUILDING LAW AND SPATIAL PLANNING LAW

The project also envisages changes to the Construction Law and the Spatial Planning and Development Act.

First and foremost, the proposed amendment to Article 10b of the Construction Law regulates specific formal requirements for appeals against decisions issued under this Act . According to the proposed provisions, an appeal or complaint against a decision or ruling will be required to include objections to the ruling, an indication of the scope of the request , and evidence supporting the request. Until now, the general provisions of the Code of Administrative Procedure have been in force, which did not introduce specific formal requirements – a written statement expressing the party's dissatisfaction with the decision was sufficient. We are not certain about the effectiveness of this solution, but we certainly consider any solution that limits the filing of unfounded appeals (or rather, leaving them unheard) positive.

Another change is to introduce the possibility of dividing real estate for housing investments regardless of the local plan (based on a location resolution).

Changes to the regulations are also proposed to streamline the process of developing an Integrated Investment Plan, by abolishing the requirement to obtain the consent of the municipal council to commence work and by eliminating the need to prepare a full draft urban planning agreement at an early stage of the procedure.

In this regard, the draft law also proposes granting the municipal council the right to adopt a resolution, constituting an act of local law, establishing guidelines for the urban planning agreement, including, in particular, the principles for defining the scope of the investor's obligations. In our opinion, this could be a significant instrument encouraging investors to engage in negotiations with the municipality, bringing greater transparency to the urban planning agreement negotiation process.

IV. CHANGES CONCERNING ROAD AGREEMENTS UNDER ARTICLE 16 OF THE PUBLIC ROADS ACT

According to the Draft, the "famous" Article 16 of the Public Roads Act will be amended, imposing on investors in non-road investments the obligation to construct or reconstruct a public road. According to the Act's assumptions, fulfillment of this obligation could also involve the investor of a non-road investment transferring funds to the road administrator .

The justification for introducing the aforementioned change is based on the increasingly popular position in legal literature that a road administrator cannot require an investor to finance road construction. This, however, happens in practice, so it's good that the legislature has recognized it.

V. OTHER CHANGES RELATING TO REAL ESTATE LAW

Changes are also planned, such as reinstating the right to establish perpetual usufruct for residential purposes. This solution effectively restore the legal status from before January 1, 2019, introduced by the Act of July 20, 2018, on the transformation of perpetual usufruct of land developed for residential purposes into ownership rights to such land. In our opinion, this will not significantly impact land supply.

In turn, the proposed exemption from planning fees for properties sold within two years of the Act's entry into force (the so-called moratorium on collecting planning fees) may contribute to increased land sales. In practice, we have repeatedly encountered situations where sellers delayed selling properties precisely because of the risk of incurring planning fees.

Detailed content of the Project can be found at this link:

https://legislacja.rcl.gov.pl/projekt/12394350/katalog/13110202#13110202

This article is for informational purposes only and does not constitute legal advice.

Legal status as of February 17, 2025

Klaudia Petrus-Sobczak

Legal Counsel
+48 22 856 36 60 | k.petrus_sobczak@kglegal.pl

Dr. Joanna Barzykowska

Attorney, partner
+48 502 677 504 | j.barzykowska@kglegal.pl

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