NEW URBAN PLANNING REFORM LAW INTRODUCES SEVERE PENALTIES WITH A VIEW TO ENFORCE TIMELY REGISTRATION WITH NATIONAL CADASTER

Recent Law 4759/9-12-2020 (Art 133) amends Law 2308/1995 (Article 2 paragraph 8, as in force) by radically reforming the status of the existing mild[1] penalty structure which has never been implemented

In an attempt to effectively address the current situation, whereby beneficiaries tended to neglect the timely registration of their real estate rights with the National Cadaster, in the absence of sanctions, the new Law increases the penalty threshold from 50.00€ to 300.00€, as well the maximum imposable amount from 1,500.00€ to 2,000.00€. Although the cap increase is prima facie not so spectacular, it could result in a perceptible difference if the maximum amount is applied, given that the existing penalties framework, in addition to its not being enforced, not only failed to exhaust the upper 1,500.00€ limit, but did not exceed 250.00€.
In addition, the new legislation provides that the Ministerial Decision[2] must, in establishing the penalties, take into account the nature of the right and the value of the property on the basis of the ‘’objective’’ evaluation system, as in force. This marks an important difference with the existing rationale, categorizing the properties by mere reference to whether they were urban or rural. Another material feature consists in the provision that penalties are subject to further surcharge depending on the delay.

The substantial height of the penalties, should they be in fact applied and enforced, in conjunction with the imposition of delay induced surcharges, offer a strong incentive to real state rights holders to benefit from the de facto grace period until the entry in force of the Ministerial Decision and regularize registrations with the National Cadaster.

[1] The existing penalties framework comprised penalties of 50, 70, 100, 150, 200 and 250 €.

[2] which must be issued within six months as from the enactment of the Law and become effective within one month as from its issuance.