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New Regulations on the Sale/Purchase of Farm Land in Unbuilt Plot Areas, Privatisation of Companies Administering Public Domain and State-owned Plots for Agricultural Purposes, and Establishment of ADS

Monitorul Oficial al Romaniei, Part I, No 178 of 12 March 2014 has published Law No 17 regarding regulatory measures for the sale/purchase of farm land in unbuilt plot areas, amendment of Law No 268 of 28 May 2001 on the privatisation of companies that administer public domain and State-owned plots for agricultural purposes, and
establishment of the State Property Management Agency (hereinafter referred to as the “Law”).

The Law aims at:

  •  ensuring food safety, safeguarding national interests and the exploitation of natural resources in accordance with national interests;
  •  establishing regulatory measures for the sale/purchase of farm land in unbuilt site areas;
  •  concentrating farmland plots with a view to setting up economically viable exploitation areas.

The provisions of this Law apply both to Romania citizens, citizens of an EU Member State, of the states that are parties to the European Economic Area Agreement (EEAA) or of the Swiss.
Confederation and to legal entities of Romanian nationality, of an EU Member State, of the states that are parties to the EEAA or of the Swiss Confederation.
The citizens and the legal entities referred to above, except for the ones having their domicile in Romania, may purchase farmland plots in Romania on a reciprocity basis.

Likewise, third-party citizens and aliens having their domicile in another state, as well as thirdcountry legal entities may acquire property rights over farmland situated in unbuilt areas under specific conditions regulated by international treaties and on a reciprocity basis as stipulated by this Law.

As regards the pre-emption right, when plots of agricultural land located in unbuilt areas are sold, it may be exercised by meeting the conditions of form and substance provided by the Civil Code, as well as by observing the pre-emption right of co-owners, leaseholders, neighbouring owners and of the State represented by the State Property Management Agency (ADS), in this order, on an equal footing and at a fair price. The Land Book Certificate represents full evidence of good faith in this respect.

The Law regulates several aspects in every detail, such as:

  •  the derogation procedure;
  •  the classification of plots of land which may be alienated only after the Ministry of National Defence has particularly approved thereof;
  •  procedure for the transfer of title to farmland in unbuilt areas where classified archaeological sites are situated;
  •  obligations and prerogatives of city governments, of the Ministry of Agriculture and Rural Development and its entities throughout the country;
  • control over the application of pre-emption right.

Any violation of the Law shall trigger administrative, civil or tort liability, as the case may be. The Law defines the actions representing offences and establishes the penalties applicable on a case by- case basis, materialised in fines ranging between RON 50,000 and RON 100,000.
The provisions of this Law shall not apply to transfers of title between relatives up to the third degree, included.
The Methodological Norms for the application of this Law shall be released within seven (7) days of the date on which it has come into force.
The Law becomes effective 30 days after the date of its publication, i.e. 12 March 2014, in Monitorul
Oficial al Romaniei.

LEGAL ALERT by Duncea, Stefanescu & Associates/MAZARS

* You may find Romanian, German and French versions of the newsletter in Mazars’ archive.

* LEGAL ALERT contains a selection of the latest major issues occurred in the Romanian legislative framework, is intended only to provide information and, hence, shall not be deemed to provide professional advice or consultancy. Therefore, we assume no responsibility in this respect.

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