Legal restrictions

1. Acquisition of immovable property by foreign persons/companies.

Are there any legal restrictions that affect a foreign citizen wishing to purchase an immoveable property? Does nationality play a role at all?

Are any permits required by a foreign citizen wishing to purchase a real estate property?  Are these matters covered by the Land Registry Procedure?

If so, please describe the procedure and name the relevant authority that must grant approval.

Spanish Law is conducted by the liberty of acquisition and the comparison of rights of either foreign and Spanish person/companies in any acquisition of immovable property. Previously, every foreign person or company that wishes to acquire any land property in Spain must obtain the Fiscal Identity Number (N.I.F.) in the Ministry of Treasury.

The main limitations are related to money movements controls, and they affect any cash-flow -within certain amounts- that is detected between Spain and any foreign country, with some specialities when that country is tax free (Law July 4th 2003 and Law 36/2006 of Prevention of Fiscal Fraud). However, these limitations only concern the obligation of declaration to the Spanish Fiscal Authorities of the cash-flow, but they do not restrict the right of foreign people or companies to acquire real state property in Spain.

The only real restrictions that concern a foreign citizen wishing to purchase an immovable property are the following:

• Real Decreto 664/1999: The foreign investments in Spain must be declared to the Registry of the Ministry of Treasury (art. 4).

For any acquisition of immovable property destinated for Consulate or Embassy, an administrative authorization is required, unless a Liberalization Agreement exists (3rd Additional Disposition). The authorization must be applied to de Ministry of Foreign Affairs, and will be granted by the Council. This restriction is not applicable for EU Members.

• 12th  March 1975 Law and 10th February 1978 Reglament: These limitations are only applicable to non EU members foreign investments.

* Immovable properties in National Defence Interest Zones cannot be acquired without a previous authorization of the Ministry of Defence.

* Immovable properties in Restricted Areas (any Spanish island, Strait of Gibraltar, Portugal or France borderland, Cartagena, Galicia and Cádiz Bay) cannot be acquired, even mortis causa, without a previous military authorization.

However, non-borderland population centres, urban zones and Turistic National Interest Areas are not included in these restrictions.

• Real Decreto 2636/1982: Any acquisition of real state property in the North of Africa, even for Spanish investors, requires a Council authorization.

All these acquisitions must be registered in the Land Registry

2. Acquisition of agricultural land: restrictions and limitations.

Are there any legal restrictions that affect a foreign citizen wishing to purchase an agricultural property? Is there any kind of limitation?

Are any permits required by a foreign citizen wishing to purchase an agricultural property? Are these matters covered by the Land Registry Procedure?

If so, please describe the procedure and name the relevant authority that must grant approval.

Are any permits required by a domestic citizen wishing to purchase an agricultural property? If so, please name the relevant authority that must grant approval.

As principle, there is no restriction or limitation for the purchase of agricultural property in Spain, neither for Spanish nor for foreign people. The only limitations are due to the former Laws for agricultural properties modernization, which are the following:

• Priority Agricultural Farms created by the former Agricultural Institute (IRYDA): If the purchase takes place within the next eight years of the former concession to the owner, an administrative authorization is required. However, this authorization is very rare.
• Sometimes it may happen that the Administrative Authority, due to fiscal reasons, imposes some restrictions in order to transmit the land property. This restrictions must be registered in the Land Registry and are imposed to Spanish or foreign acquirers.
• If the land is located, the tenant has a legal preference for the property acquisition. The purchase conditions must be previously notified to the tenant so that the acquisition can be registered in the Land Registry.

3. Acquisition of flat property: legal restrictions.

With regard to the purchase of flat property, are there any legal restrictions, such as approval by other apartment owners or by the management company responsible for the relevant property (stipulated in the statutes for example)? Are these matters covered by the Land Registry Procedure?

If so, please describe the procedure and name the relevant authority that must grant approval.

With regard to the purchase of flat property, there are no legal restrictions: there are not pre emption rights in favour the other building owners, as far as they own a separated property flat. Any approval by other apartment owners or by the management company responsible for the relevant property is not  required. This approval may be only required in case of flat or building alterations, but not at all in the purchase of flats or urban properties. This kind of property is formerly registered in the Land Registry as owned by its legal titular, who is free to sell his property. The only case that the Community of Owners approval is required is when the property that is going to be acquired is owned by the whole Community, as part of the common elements of the building, and it is registered in the Land Registry as such common property.

In addition, if the flat is located, the tenant must be notified of the purchase, because he has a priority right of acquisition of the occupied flat.

4. Acquisition of immovable property in special areas (such as on the coast or near military-related sites or in national parks, in the mountains, etc.)

Is a permit required for the acquisition of real estate property in special areas (such as on the coast or near military-related sites or in national parks, mountains, etc.)? Is this part of the Land Registry Procedure?

If so, please describe the procedure and name the relevant authority that must grant approval.

The special restrictions for foreign investors have been already related in paragraph I. In this paragraph, limitations that will be exposed affect to every acquisition, even for Spanish purchasers:

• Mountains, 10/2006 Law: Autonomic Communities and Public Administrations have a priority acquisition right in case of transmission of public mountains or properties nearby public mountains. A previous notification to the Public Administration is required (art. 25).
• National Parks, 5/2007 Law: Public Administration has a priority acquisition right in case of transmission of any right in lands included in National Park Areas (art. 13). A previous notification is required.
• Natural Special Protection Areas, 16/2007 Law: Autonomic Communities have a priority right in case of transmission of any right in lands included in those areas. A previous notification is required (art. 39).
• The Coast, 22/1988 Law requires a previous report for any acquisition of land property near the coast. The coast authority must declare that the acquisition does not invade the public territory. In addition, Spanish State has a pre-emption right to acquire the areas near the coast that are part of the Public Territory but that are already edified and owned by individuals within the former Coast Law (Transitory Dispositions of 22/1988 Coast Law).Once notified, the acquisition has no other restriction.

Several circumstances that may affect the land property, specially in rural areas, such as flood risks, public rivers servitudes, specially protected natural areas, or acoustical or environmental contamination, can also be sought in several administrative registers.

We can list here the National Mapping System of Flood Hazard Areas:

http://www.magrama.gob.es/es/agua/temas/gestion-de-los-riesgos-de-inundacion/snczi,

The Enviromental Register of Andalucía http://www.juntadeandalucia.es, and the Register of Environmental and Hydrographic zones of Aragón http://sitar.aragon.es/index.htm.

It is important to remark, that Land Register is trying to incorporate this graphic information by the coordination of the Cadastre maps and a new system of ortophotograpy, than includes several layers of information taken from these administrative registers. So that any person interested on the land can know not only the legal burdens and the situation of the property, but also the natural and environmental contingencies that may affect the eventual decision of acquiring the property.

5. Acquisition of immovable property and listed monuments and memorials.

Is a special permit required for the acquisition of monuments or listed buildings?

If yes, please name the relevant authority that must grant approval.

Is this part of the Land Registry Procedure?

Monuments and listed buildings are usually owned by the State, the Autonomic Community or the municipalities. Limitations on these acquisitions depend on the classification of the public property. But these limitations affect above all to the alienation (it is in fact the owner who may request some authorizations, make some notifications or change the classification of the property. i.e.), not to the acquisition itself.

Of course, all the legal conditions for the alienation of public property are controlled by the Land Registry, and they must be registered in it.

6. Planning Code and legal restrictions (pre-emption right; approval by the municipality or other authorities; splitting a land parcel).

Do your municipalities or the government have a special pre-emption right to property (i.e. a right of first option for the sale of a real estate property)? Does land division require a special permit?

If yes, please name the relevant authority that must grant approval.

Are these matters covered by the Land Registry Procedure?

The municipalities and other Public Administrations have a pre-emption right in case of alienation of certain properties. These cases are contained in the former paragraphs (mountains, national parks, natural special protection areas, flats included in V.P.O. buildings, priority agriculture farms).

All these matters are covered by the Land Registry Procedure.

In addition, Spanish State has a pre-emption right to acquire the areas near the coast that are part of the Public Territory but that are already edified and owned by individuals within the former Coast Law (Transitory Dispositions of 22/1988 Coast Law).

In reference to land division, it is obligatory to obtain a special licence by the municipality. This licence must be included in the deeds so that the new land configuration can accede to the Land Registry.

7. Land given by the municipality to domestic inhabitants: legal restrictions?.

Does your national law have a so-called local residents model, i.e. the allocation of land by the municipality under the condition that the buyer is obliged to keep the land and not to move away for a specific number of years?

If yes, are there any legal restrictions for the purchaser?

In Spain must be explained the “public housing” figure, that is, state-subsidized housing. It´s about houses which are promoted or builded by the Autonomous Communities or by particulars to be offered to individuals or families cheaply, or cheaper than the market.

Buyers, awardees or promoters of Public Housing for their own use are obligued to destinate the houses to permanent residences, and occupy these within a specified period. Public housing may not be transfer  within the specified period determined by each Autonomous region, except by administrative approval for justified reasons. Public housing  are subject to right of first offer in favour of the Autonomous region, while its regime lasts, usually 30 years.

A different case is the  public aid for acquisition of a house, whether it be public housing or not. Buyers, awardees or public promoters that have received public aid are to a ban of dispose a 10 years period from the date of legalizing the acquisition. If it is a public house, the public aid involves a prohibition of voluntary disqualification during the subsistence of regimen of public housing.

Owners will need to obtain a previous approval of the contract by the competent administrative authority of the Autonomous region, called visado (visa).

When the flat has the category of V.P.O. (Legal Protection Property), an administrative authorization for the purchase is required. These flats can only be purchased for th purpose of devoted it to permanent and habitual residence, it is also needed that the purchaser has limited incomes fixed by regional government. Due to special financial reasons that were applied for the construction and the original purchase of the flat property.

This V.P.O category must be previously registered in the Land Registry. Land registry will inform about it.

8. Acquisition of immovable property and tax affairs.

Must the transfer tax be paid before or after the registration in the land register? Can the Land Registry carry out the real estate property registration without a certification from the tax office?

In order to obtain the registration is absolutely compulsory the previous payment of the principal taxes which involves the deeds, that is:

The impuesto de sucesiones y donaciones (succession and donation tax, which taxes the inheritances and liberalities) and the impuesto de transmisiones patrimoniales onerosas y actos jurídicos documentados (onerous transfers and  deed tax, which taxes the transfers of real estates by price, the internal companies agreements which involves a transmission to the members, and the execution or sign of a deed with juridical contents).

The Land Registrar is not able to check the documents without the previous accreditation of the payment, exemption or not subjection to these taxes. Without that accreditation, the Registry´s entry will be cancelled after 60 days.

More information about this question can be read in previous chapter of this fact sheet.

9. Destination of the land parcel and legal restrictions.

Does your national law have special legal restrictions that are already apparent from the description of the land parcel?

Here we must to explain the regulation of the so called minimum cultivation unit. The Autonomous region, or failing them, the State, can fix the minimum measure which must be preserved in order to ensure the viability of the cultivation lands.

Once fixed this measure, different in each region, land cannot be divided if it results a parcel smaller than this measure, excepting some singular cases determined by the law.

Even if there is a licence given by the Municipality, the Land Registrar must require to the administrative authority of the Autonomous Region, in order to obtain a resolution that clarifies if it is given the exceptional case or not.

In the description of the parcel is compulsory to advertise if it is dry land or irrigated land and the measure, and so it is easy to know if it is under the minimum cultivation unit regulation.

10. Any other legal, very specific restrictions.

Does your national law have other, very specific legal restrictions that the Land Registry must observe?

If so, please describe the legal restrictions and their impact on the Land Registry procedure.

There are some legal restrictions over the land which are not contained in the previous questions. The principals are (classified under it´s nature):

• In order to protect the civil population: In any case of emergency, public authorities can occupy every private ownership which be necessary (art.4.7  2/85 Law, of January the 21st 1985, about civil defence).
• In order to protect the environment: The 42/2007 Law of December the 13th 2007 about Environment and Biodiversity establishes some restrictions in order to preserve the nature areas, including acquisition rights in the art. 39.1.
• In order to protect the communications: Several laws (July the 29th 1988 for Roads, 16/1987 for Earth Transports´ planning, May the 10th 1972 for Motorways, for instance) establishes some limitations, especially by the definition of special protection areas, strips of land in both sides of the way, the road, the highway, the railway, or around the seaport or the airport, where it´s not possible make buildings and it´s necessary the previous permission of the authorities for any occupation.
• In order to protect the rivers, the 1/2001 Law of July the 20th 2001, about Water Resources, establishes too special protection areas in both sides of the rivers, specifically two stripes. The first one (five meters from the river´s edge) is destined for ensure the free circulation along the rivers, specially thinking about the rescue and cleaning operations, and inside this area it´s banned every kind of building. The second (One hundred meters from the river´s edge), is destined for prevent any obstacles to the river´s flooding. Inside this area it´s are prohibited too the buildings, and every activities which cause obstacles or damage to the river.
• In order to protect the legality of the urban development, the 2/2008 Law of June the 20th 2008, about Building Lands, establishes the following legal restrictions.

a) Art. 9 imposes to every building land´s owner the duty of using the land in a compatible way with the town planning, and considers this duty like a special content of the property right, turning this right in a so called special property. As a development, art 16 imposes some special duties to the owners, in order to ensure the execution of the town planning.

c) Art. 17, prohibits the owners to parcel against the planning, and imposes the Land Registry the special duty of controlling the land´s divisions, rejecting them when there is no license or Administrative permission.

d) Art. 20, says that the Land Registry must check, for the approval of the new building´s registration, the administrative license and a technical guarantee (by certificate or by the declaration in the deed), about the adjustment between the new building´s description and the administrative license.

Annexe/documentation The appropriate national legislation texts or other documents may be attached here.

• About foreign investments: Real Decreto  664/1999, de 23 de abril, sobre inversiones exteriores; Ley 36/2006, de 29 de noviembre, de Medidas para la Prevención del Fraude Fiscal.
• About military interest´s protection, and it´s influence over the foreign investments: Ley 8/1975 de 12 de marzo  sobre Zonas e Instalaciones de Interés para la Defensa Nacional; Reglamento de 10 de febrero de 1978;
• About agricultural restrictions: Ley de reforma y desarrollo  agrario de 12.1.1973;  Ley 19/1995 de 4 de julio, de Modernización de Explotaciones Agrarias.
• About Public Housing: Real Decreto-ley 31/1978, de 31 de octubre, sobre política de viviendas de protección oficial; Real Decreto 3148/1978, de 10 de noviembre, por el que se desarrolla el Real Decreto-ley 31/1978, de 31 de octubre, sobre política de vivienda.; Real Decreto 2066/2008, de 12 de diciembre, por el que se regula el Plan Estatal de Vivienda y Rehabilitación 2009-2012.
• About Mountains:  Ley 43/2003, de 21 de noviembre, de Montes.
• About National Parks: Ley 5/2007 de 3 de abril, de la Red de Parques Nacionales.
• About Coasts: Ley 22/1988 de 28 de julio, de Costas.
• About Civil Defence: Ley 2/85 de 21 de Enero, de Protección Civil.
• About protection of the Biodiversity and the Environment:  Ley 42/2007 de 13 de diciembre, de Protección del Medio Ambiente y la Biodiversidad.
• About protection of the communications:  Ley 25/1988 de 29 julio, de Carreteras ; Ley  16/87 de 30 de Julio, de Ordenación de Transportes Terrestres; Ley  8/1972 de 10 de mayo, sobre construcción, conservación y explotación de autopistas en régimen de concesión.
• About protection of Water Resources: Ley 1/2002 de 20 de julio, de Aguas.
• About protection of the legality with regard to urban development: Ley 2/2008, de 20 de junio, del Suelo.