Legal restrictions
A)Preface: the purpose of the ELRA Handbook – Legal Restrictions
More and more people are moving to other European countries in order to seek out a new and more attractive lifestyle. The reasons are partly private and partly professional.
At the same time, more and more people are buying property abroad, be it to provide for retirement or to make an interesting investment. The achievement of a functional internal market is one of the fundamental principles of the European Union, as stated in the Treaty on the Functioning of the European Union (Article 26). That is why the legal restrictions for foreigners are always an integral part of negotiations with the European Union.
The purpose of the ELRA Handbook is to give an overview of the legal restrictions in relation to the acquisition of real estate property.
The ELRA Handbook may also serve as a road map designed to make the process of purchasing real estate property abroad more transparent and understandable.
The ELRA Handbook is based on a questionnaire that was created in November 2010 and presented to the Member Associations during the XII General Assembly in Brussels. It is a compilation of national legislative provisions and as such is intended to provide some insight into the respective national land registry systems.
B)Scope of the Handbook: real estate property transfer and real estate property registration
The scope of the Handbook is restricted to real estate property transfer and real estate property registration. The questions that are always asked are: apart from the deed, what else is needed to register a property in the land registry?
What legal restrictions must be taken into account when seeking to become the owner of a real estate property? These questions can only be answered within the context of the respective national legislation.
C)Legal restrictions in the field of real estate property transfer and real estate property registration
I. Acquisition of immovable property by foreign persons/companies
Question:
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.
Answer:
In case of purchasing buildings or premises by foreign citizens, there are no restrictions or additional requirements set forth in Lithuania.
The Constitutional Law of the Republic of Lithuania prescribes that land, except for agricultural land, may be acquired by foreign subjects into ownership under the same procedure and subject to the same terms and conditions as the citizens and legal persons of the Republic of Lithuania if they meet the criteria of European and transatlantic integration embarked sobre Lithuania
The criteria of European and transatlantic integration embarked sobre Lithuania are met by foreign legal persons as well as other foreign organisations set up in:
1) The European Union member states or states parties to the Europe (Association) Agreement concluded with the European Communities and their member states;
2) Member states of the Organisation for Economic Co-operation and Development, North Atlantic Treaty Organisation and states parties to the European Economic Area Agreement.
The criteria of European and transatlantic integration embarked sobre Lithuania are met by nationals of the states specified above and permanent residents of the said foreign states, as well as permanent residents of the Republic of Lithuania who are not citizens of the Republic of Lithuania.
II. Acquisition of agricultural land: restrictions and limitations
Question:
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.
Answer:
Foreign subjects, meeting the criteria of European and transatlantic integration embarked sobre Lithuania (described in the first answer above) , except for foreigners who have been permanently residing in Lithuania for not less than 3 years and have been engaged in agricultural activities, and foreign legal entities as well as other foreign organisations, which have established representative offices or branches (affiliates) in Lithuania, may not acquire agricultural land and forest land until the expiry of transitional term of 7 years provided for in the Treaty concerning the Accession of the Republic of Lithuania to the European Union. This term expires 1 May 2011.
The head of the National Land Service under the Ministry of Agriculture or the head of the territorial unit authorised by the head of the National Land Service shall make decisions sobre the sale of land parcels and sign the state-owned land purchase-sale contracts. The head of the State Enterprise State Property Fund or a person authorised by him shall make a decision on the sale of land parcels attributed to the privatised buildings and facilities under the territorial planning documents.
A person, willing to purchase a land parcel, must submit the documents, a list thereof is given in the Rules on the Sale of State-owned Agricultural Land Parcels, to the institution executing the sale.
III. Acquisition of flat property: legal restrictions
Question:
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.
Answer:
There are no legal restrictions related to the purchase of flat.
IV. Acquisition of immovable property in special areas (such as sobre the coast or near military-related sites or in national parks, in the mountains, etc.)
Question:
Is a permit required for the acquisition of real estate property in special areas (such as sobre 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.
Answer:
Article 47 of the Constitution of the Republic of Lithuania prescribes that the underground, internal waters of state significance, forests, parks, roads, historical, archaeological and cultural objects of State importance shall belong by the right of exclusive ownership to the Republic of Lithuania. Other objects may be acquired under the general procedures.
V. Acquisition of immovable property and listed monuments and memorials
Question:
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?
Answer:
As it was said above in Question IV, historical, archaeological and cultural objects of State importance shall belong by the right of exclusive ownership to the Republic of Lithuania.
VI. Planning Code and legal restrictions (pre-emption right; approval by the municipality or other authorities; splitting a land parcel)
Question:
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?
Answer:
The Land Law establishes that in case of private land offered for sale and situated within the areas of state parks of conservation, ecological protection and recreation priority, and also in the state reserves and other protected areas having the status of Natura 2000 the State shall have the pre-emption right to buy it under the same conditions and at a price agreed between the seller and the buyer.
In residential areas land parcels are divided by preparing a detailed plan, which is approved by urban municipality.
In rural areas land parcels are divided by preparing a plan sobre land parcel re-allotment, which is approved by the National Land Service.
VII. Land given by the municipality to domestic inhabitants: legal restrictions?
Question:
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?
Answer:
Such model is not provided for in the law of Lithuania.
VIII. Acquisition of immovable property and tax affairs
Question:
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?
Answer:
There is no transfer tax in Lithuania. A certificate from the tax office is not needed for property registration in the Real Property Register.
IX. Destination of the land parcel and legal restrictions
Question:
Does your national law have special legal restrictions that are already apparent from the description of the land parcel?
Answer:
Legal restrictions are not provided in the description of the land parcel.
X. Any other legal, very specific restrictions
Question:
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.
Answer:
The Law on Real Property Register establishes that the administrator of the Real Property Register shall have the right to refuse to register real rights to real property, encumbrances on these rights and legal facts if at least one of the following circumstances is detected during the examination of the application:
1. Persons who filed the application had no right to file it;
2. The document, on the basis of which the registration is requested, does not meet the requirements of this Law;
3. The document, on the basis of which the registration is requested, does not comply with the form established by laws or transacting parties;
4. The document, on the basis of which the registration is requested, has been abrogated, declared void or otherwise declared invalid;
5. The advance payment for registration fixed by the administrator of the Real Property Register has not been made;
6. The application or the document filed to the administrator of the Real Property Register lack the data provided for in the Regulations on the Real Property Register that are indispensable for the identification of the acquirers of real property and real rights to it;
7. The laws do not provide for the possibility to register real rights to real property, encumbrances on these rights or legal facts in the Real Property Register the registration thereof is requested;
8. The data about real property submitted to the administrator of the Real Property Register do not coincide with the data about this property recorded in the Real Property Cadastre;
9. The administrator of the Real Property Register has already made a decision to refuse (to postpone the decision) the registration of the same real rights to real property, encumbrances on these rights and legal facts on the basis of the same documents.
D) The legal philosophy of restrictions (public interests?)
You may make general remarks here about the philosophy of legal restrictions, for instance, underlying public interests etc.
Answer:
The Land Law establishes that land for public needs from private landowners may be taken on exceptional cases under the decision of the head of the National Land Service subject to the application of the governmental authority or municipal council in case this land is needed for:
1. The protection of the national and state border;
2. Public airports, ports and their facilities;
3. The construction of public use railways and roads, mains and high voltage transmission lines, also for engineering facilities intended for public needs, which belong to the state or municipality by the right of ownership and are needed for the maintenance of the said objects;
4. The development of social infrastructure, i.e. for building (equipping) and maintenance of education and science, culture, health care, environment protection, social security, public order, physical training and sports development objects;
5. Public recreation and leisure;
6. The exploitation of the explored mineral resources;
7. The construction (equipping) and maintenance of objects (dumps) for waste management;
8. The construction and maintenance of objects necessary for cemeteries and their exploitation;
9. The purposes of protecting natural and cultural heritage territorial complexes and objects;
10. The implementation of major economic projects, which are significant for the state, and this significance for the public needs is recognised by the Seimas or the Government in their decisions.
When making a decision on taking land for public needs, the decision-making institution must provide motivated grounds that a concrete public need really exists and that it would not be satisfied if a concrete land parcel was not taken for this need.
E) Annexe/documentation The appropriate national legislation texts or other documents may be attached here.
