As of August 31, 2023, as a result of the enacted act of May 26, 2023, amending among others the Act on Real Estate Management, entrepreneurs and other legal entities will be able to convert perpetual usufruct into ownership upon application. Until now, this possibility could only be used for land intended for residential purposes.
The amendment provides for the possibility for perpetual usufructs to acquire ownership of land owned by the State Treasury or local government units, in particular used primarily for business activities. Entrepreneurs will only be able to submit an application to this extent for one year of such regulation. It is worth noting that the 1-year deadline applies only to the submission of the application, while the entire subsequent process related to the conclusion of the agreement, the determination of the price of the land does not count towards this period.
In practice, public authorities will no longer be in a position to refuse to sell land to a perpetual usufructuary, including an entrepreneur, if an application is filed in this regard. At the same time, it is worth noting that this regulation applies both to the situation of concluding a perpetual usufruct agreement and to the creation of perpetual usufruct by operation of law.
The provisions of the amendment also introduce detailed rules for determining the price of sold property, distinguishing between conditions for property owned by the State Treasury or local government bodies. These prices will be calculated as multiples of the existing perpetual usufruct fees.
Taking into account the relatively short period of validity of the above regulation, it is already worthwhile to start analyzing the profitability of requesting redemption. Certainly the introduced changes will contribute to the gradual expiration of the right of perpetual usufruct, which seems to be a welcome direction of change.
Author:
Marek Generowicz
Trainee attorney-at-law