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Purchase of real estate by foreigners in Poland
Purchase of real estate by foreigners in Poland
1. Introduction
The following study does not constitute a legal opinion, but aims at pointing out general principles governing the purchase of real estate by foreigners in Poland. In case of questions or doubts we provide contact with Polish lawyers – experts in this field.
The purchase of real estate by foreigners in Poland requires an administrative permit. The range of limitations depends on which country the buyer is a citizen or a resident of.
If he/she is a citizen or resident of a member country of European Economic Area EEA (Austria, Belgium, Bulgaria, Czech Republic, Cyprus, Denmark, Estonia, Finland, France, Germany, Great Britain, Greece, Hungary, Ireland, Island, Latvia, Liechtenstein, Lithuania, Luxemburg, Malta, the Netherlands, Norway, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden) or Switzerland, the limitations are of temporary nature and concern only some transactions.
The citizens or residents of other countries must nearly always obtain permits.
2. Who must obtain the permit
The limitations apply to the foreigners, which is to:
- natural persons without Polish citizenship,
- legal persons with their registered offices abroad,
- companies of the above mentioned persons with their registered offices abroad,
- a legal person or a commercial company with its registered office in Poland, controlled by persons or companies enumerated in the previous points.
3. Which transactions require a permit
Foreigners from EEA countries and Switzerland
- purchase of agricultural real estate – by 1st May 2016
- purchase of real estate in forestry – by 1st May 2016
- purchase of a second house – by 1st May 2009
A second house means a real estate property designed for residential or recreational purposes which shall not constitute the habitual residence of the foreigner.
Except for that, these foreigners may purchase real estate in Poland according to the same regulations as Polish citizens. Limitations apply only to the purchase of real estate made directly by a foreigner. If the foreigner desires to buy real estate through a Polish company – it can be done without any permit.
Remaining foreigners
- purchase of real estate in Poland,
- taking over control of a Polish company – the owner of the real estate - by a foreigner (e.g. purchasing or acquiring shares, obtaining the right of pledge on the shares)
- access of a new shareholder – a foreigner – to a Polish company already controlled by foreigners.
The company becomes a controlled company when, e.g., foreigners hold over 50% of votes or are entitled to appoint and dismiss members of its management.
4. Which transactions do not require a permit
Foreigners from EEA Courtiers and Switzerland
- purchase of agricultural real estate by its leaseholder – a farmer – after 3 years (in some provinces after 7 years) of the conclusion of the leasing contract,
- purchase of a second house if the buyer has been legally living in Poland for at least 4 years,
- purchase of a second house for the sake of performing tourist services.
Below are shown the most important examples of transactions which do not require a permit:
- purchase of the living premises or a garage
- purchase of real estate if the buyer has been legally living in Poland for at least 5 years
- purchase of real estate if the buyer is a spouse of a Polish citizen and has been living in Poland for at least 2 years
- acquisition through inheritance (the exemption does not apply to the will)
- purchase of an urban land by a company controlled by foreigners (altogether not more than 0.4 hectare)
- purchase of real estate through foreign banks and closed-end investment funds in certain circumstances.
If, however, the real estate is situated in the border zone or constitutes an agricultural land of the area exceeding 1 hectare, its purchase always requires a permit.
5. Consequences of lack of permit
A foreigner who has bought real estate without a required permit is not considered to be its owner. The purchase is void and ineffective.
6. Who issues a permit
A permit is issued by the Minister of Interior and Administration through an administrative decision.
The permit shall not be issued if the Minister of National Defence or the Minister of Agriculture raise their objections.
7. Conditions of obtaining a permit
A permit is issued on the basis of the foreigner’s application, if:
- the purchase of the real estate will not pose a threat to defensive capability and security of the country nor to the public order, and when social policy considerations or the reasons concerning health of the society are not in contradiction with it;
- he/she has proved the circumstances confirming his/her ties with Poland, e.g. Polish descent, marriage entered with a Polish national, legal residence in Poland.
8. Which documents need to be submitted
The regulations state very precisely the documents which should be submitted in order to apply for a permit. They include among others:
- the application for the permit, comprising: - specification of the applicant and his/her legal status - specification of the real estate to be purchased - specification of the alienator - specification of the legal form of acquiring the real estate - information about the purpose and possibility of the acquisition of the real estate - the type of investment or business to be carried out in the purchased real estate - the origin of financial resources for the purchase of the real estate - data concerning controlled companies, shares and real estates owned by those companies
- documents confirming the circumstances indicated in the application, including: - in the case of a natural person – a document confirming his/her identity as well as an entry from the right register or records - in the case of a legal person or a company which does not have a legal personality – an entry from the right register - an entry from the Real Estate and Mortgage Register of that real estate or a certificate from the records, - extract from the land registry accompanied by a cadastral map extract - a register of geodetic changes of the land - extract from the land development plan - statement of the alienator expressing the will to sell the property (or shares in a company) to the foreigner - entry from the Polish Company Register (KRS) for the controlled company - agreement or statute of the company with all further amendments - updated copy of share register - documents proving legal status of the alienator of the shares
- special statement – while acquiring no fewer than 15 properties
- copy or entry from the Polish Company Register or a certificate from the register of businesses for a Polish subject controlled by a foreigner
- certificate from the tax office, confirming lack of tax arrears
- certificate from ZUS (National Insurance Company) confirming lack of insurance contributions arrears
- documents proving the possession of financial resources for the purchase of the real estate and the possibilities of financing the activity
Apart from that the Minister may also require further information or documents.
All the documents in foreign languages should be submitted together with their translations into Polish signed by a certified translator.
9. Period of validity of the permit
The permit is valid for two years of the date of issue.The foreigner may apply for a pledge to issue the permit, hereafter referred to as ‘the promise’ The promise is valid for one year of the date of its issue. In the period of the validity of the promise the permit cannot be refused unless the actual state, relevant to the decision in the given case, has been changed.
10. How long does it take
Provided smooth legal service and quick completion and translation of the necessary documents the decision may be obtained within one – two months of the submission of the application.
Otherwise the procedure may take much longer.
If the purchase does not require the permit, the time of completing the transaction may be shortened even more.
10.04.2008. 19:06
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