Like last year, we'd like to dedicate the final article in our "Tuesday Mornings for Construction" series for 2021 to summarizing what's happened in the law and what we've written about this year. There's no doubt that the biggest change that will have a huge impact on the housing market is the adoption of the new Development Act. Moving on to the specifics, here are the most important changes.
1. Local development plans
This year, we began by discussing issues related to local plans, a series edited by attorney Michał Rutkowski. These are the fundamental planning act that constitutes the source of local law ( #33 ), and residents themselves can influence the final content by submitting comments to the plan ( #34 ).
The interpretation of local plans often raises interpretative questions, so their correct interpretation requires the use of a range of interpretative methods, such as linguistic or systemic interpretation ( #35 ). We have also discussed the issues we encounter in our practice ( #37 ). We have also identified the grounds for declaring a local plan invalid ( #42 ).
Although changes to spatial planning were announced as early as 2021 ( #36 ), they have not been finally presented in the form of a draft amendment. However, as the Ministry of Development and Technology assures, work on reforming the spatial planning system is ongoing, and we can expect the project to be presented as early as 2022. We will certainly continue to analyze this topic.
2. The Land-for-Premise Act
On April 1, 2021, the Act of December 16, 2020, on the settlement of the price of premises or buildings in the price of real estate sold from municipal real estate resources, the so-called "premises for land" Act, entered into force. As attorney-at-law Aleksandra Jastrzębska pointed out in our alerts ( #38 and #39 ), the purpose of the Act is to define the principles under which real estate belonging to municipal real estate resources may be sold to private investors. Crucially, part of the price would be settled by transferring ownership of the premises or buildings to the municipality.
The drafters hoped that this law would free up municipal real estate and allow for increased investment in municipalities by opening up the possibility of selling previously unavailable, yet often attractive, land. Unfortunately, although the law has been in force for eight months, we have not heard of any projects implemented based on these provisions.
3. Amendment to the public procurement law
Much has been written about the amendment to public procurement law, but we focused on three issues, selected by senior attorney Paulina Chołoniewska. We wrote about the new definition of a construction contractor ( #43 ), balancing the positions of parties in tender procedures ( #44 ), and out-of-court dispute resolution ( #45 ).
4. New development act
This year, we devoted the most alerts, seven of them, to the new development act – the Act of May 20, 2021, on the Protection of the Rights of Purchasers of Residential Premises or Single-Family Homes and the Developer Guarantee Fund. We tried to outline the most important changes that will come into force on July 1, 2022. Today's alert is too short to repeat them all, so we invite you to reread: the reservation agreement ( #47 ), the information prospectus ( #48 and #49 ), the types of contracts regulated by the new development act ( #50 , #51 and #52 ), the new procedure for the acceptance of premises ( #54 ), the obligations of banks and developers ( #55 ), and the Developer Guarantee Fund ( #56 ).
In addition to these alerts, attorney Dr. Joanna Barzykowska has conducted a number of training sessions on this topic, including those conducted by the Polish Association of Developers. We are proud and pleased to be able to meet with you as a supporting member of the PZFD.
5. Agricultural land trade
Due to the many questions our clients have regarding agricultural land transactions, and in particular legal restrictions, we have also addressed this topic. In the first two alerts, we described issues related to the National Support Center for Agriculture's pre-emption ( #61 ) and the procedure for obtaining KOWR approvals for the sale of agricultural properties ( #60 ). We also went further and analyzed issues related to the exclusion of land from agricultural production ( #62 ) and the associated fees ( #64 ), as well as the development of habitat plots ( #66 ). We also considered the protection of forest properties ( #65 ), a topic analyzed by attorney Adrianna Kobylarczyk.
6. Perpetual usufruct
This year, we also addressed the issue of perpetual usufruct. Although developed land was converted to residential use on January 1, 2019, this topic still affects our clients. Therefore, we addressed issues such as the perpetual usufruct holder's rights to extend the perpetual usufruct period ( #67 ), the expiration of this right ( #68 ), and the termination or amendment of the perpetual usufruct agreement ( #69 ).
7. Protection of the monument conservator
Another major challenge we encounter in practice is the principles and scope of conservation protection for immovable monuments. Therefore, we have prepared a guide for you on the forms of monument protection ( #72 ), protection measures ( #73 ), and the implementation of investments on properties subject to conservation protection ( #74 ). We also wrote about the planned amendment to the Act on the Protection and Care of Monuments ( #76 ), which has not yet been submitted for adoption.
8. Proceedings conducted by the Office of Competition and Consumer Protection against developers
We spent the last few weeks of 2021 exploring the complexities of proceedings conducted by the President of the Office of Competition and Consumer Protection (UOKiK) regarding practices that violate collective consumer interests and the use of prohibited contract terms in consumer contract templates. We received information from our clients about the Office's increased activity in auditing businesses.
We outlined the powers of the President ( #78 ) and the principles of proceedings conducted by this body ( #79 ), including the developer's burden of proving that they are not violating applicable regulations ( #82 ). We also outlined the penalties that can be imposed by the President of the Office of Competition and Consumer Protection if the developer is found guilty.
As part of this series, attorney Patryk Grochowski also pointed out to you cases when the final price of a residential premises may be changed after the investment is completed (#81).
9. Amendment to the construction law
Regarding the Construction Law itself, we would like to remind you that on September 17, 2021, the Sejm adopted an act amending the Building Law and the Spatial Planning and Development Act, based on which investors gained the right to build single-family residential buildings: detached, no more than two-story, with a building area of up to 70 m², whose impact area falls entirely within the plot or plots on which they were designed (we explained what the impact area means in #9 ). We wrote about the principles of conducting such construction to meet your own housing purposes in alert #71 .
In summary, it's worth mentioning two additional effects of legal changes that took place in 2020. First, in July 2021, the regulations on the digitalization of construction law came into full force, including the possibility of submitting a building permit application along with a construction design electronically. In practice, we hear about technical limitations faced by offices when submitting applications electronically, but we are undoubtedly heading in the right direction.
The second important moment is September 19, 2021, when the amendment to the Construction Law introduced by the Act of February 13, 2020 amending the Act - Construction Law and certain other acts, about which we wrote to you in our first alerts since June 2020, comes into full force.
In summary , a lot happened in 2021, not only in terms of changes to the law itself, but also in the interpretation of existing regulations. We hope our alerts help you understand them.
This is the last alert in 2021, so in the coming New Year we would like to thank all the authors of our articles, and we wish you, above all, many good investments and as few surprises as possible in these projects, as well as much success.
This article is for informational purposes only and does not constitute legal advice.
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