Property bill rattles foreign investors
By : Jeffrey Sparshott
In a worrying move for foreign investors, President Aleksander Kwasniewski is studying a bill to formally change the application process for foreigners to purchase or use land in Poland. The legislation states that real estate permits issued to foreigners will be subject to a new 10-year review.
Kwasniewski, who received the legislation from Parliament early this month, has until Feb. 27 to make a decision. A spokesman said the president is gathering information on the law, but would not indicate whether Kwasniewski will approve the bill.
Under the proposed amendments to the 1920 law on real estate acquisition by foreigners, the Interior Ministry would be able to annul the sale of land if a foreign company is not using it for the purpose outlined in the original application.
"This law once again opens a vast field for bureaucrats, for the superficial subjective view of clerks," said Jerzy Hendrich, director of Commercial Property Services, a Wroclaw-based property consultancy. He explained that it is difficult to see 10 years into the future and that a company's priorities and strategy can change.
"With the current law, foreigners have to apply to the Interior Ministry for permission," Hendrich said. "If permission is granted, the thing is final. You can't play tricks with property, it's too serious a business."
Dorota Latkowska, an attorney with Knight Frank Nieruchomosci, a U.K.-based real estate agency, said the interior minister can already impose special conditions on permits and review applications. "It's not a major change," she said. "According to the current law, the minister of the interior can put special conditions on acquiring property. This is rather more precise that (now) he will have a right to do it," she said.
A Senate staff member said the proposed amendments would bring Poland's laws into greater compliance with its 1994 agreement with the European Union (EU). The staff member said that when Poland adopts EU law entirely, the 10-year provision would be superceded because permits will no longer be necessary or valid for companies from within the union.
According to Barbara Sawicz, the investment director at the Polish Agency for Foreign Investment (PAIZ), there is no difference in how property acquisition laws are carried out for EU members and non-EU countries. She added that only non-Polish citizens or companies are required to go through the application process.
Juliet D. Golden and Robert Wylot contributed to this article
