Real Estate

Croatia: Easier Legalisation for Buildings Built without a Permit

The strict 2011 legislation on legalisation of buildings built without a permit was amended in 20121. The aim was to enlarge the number of legalisation requests and to simplify, economise and expedite the legalisation of an estimated 90% of all buildings in Croatia.

Why legalise buildings?

Generally2, illegally built buildings are those built, fully or partially, without an adequate building permit or contrary (eg, in excess) to the building permit and registered on the digital map of the Croatian cadastral office of 21 June 2011, or another official map. They are at high risk of being removed by order, with the owner bearing all costs. If a business operates in an illegally built building, no business permit can be obtained and there is a high risk of seizure. Illegally built buildings cannot typically be registered with the cadastral office or the land register. Further, no connection to communal utilities (water, electricity, sewer, etc.) is granted. These are just some of the risks of illegally built objects.

Although these risks also existed before 2012 legislation3, in the past illegally built buildings were removed only occasionally. However, this should change as of 30 June 20134, when the deadline for submission of legalisation requests expires. Because the Croatian government is determined to bring discipline to construction, to improve Croatia’s landscape, and to ensure discipline in paying communal and related fees, after the 30 June 2013 all buildings without adequate permits will be removed. This determination of the state is already visible in issuance of removal orders for all illegally built buildings that do not satisfy the basic criteria for legalisation (ie, buildings built illegally after 21 June 2012)5.

Legalisation procedure – broadening the number of objects fit for legalisation and aiming at a swifter, less expensive procedure

Few legalisation requests were submitted on the basis of the 2011 legalisation legislation, and difficulties were detected in the procedures. So the 2012 legalisation legislation broadened the scope of illegally built objects fit for legalisation, simplified the required documentation for legalisation, reduced the involvement of experts (architects, geometers, etc), lowered fees and compensation, and enabled instalment payments. These changes should result in more legalisation requests, swifter procedures, more approved legalisations and a lower economic burden for owners. Many illegally built buildings are residential houses, weekend houses, space for small businesses (eg, agriculture, farming) and the like, financed by families from their savings and built over a number of years.

Permits obtained on the basis of the legalisation procedure will be proof that a permit corresponding to the building and usage permit has been obtained, and the building is thus legal.

Legalisation in practice

According to the experts, the new 2012 legalisation mechanism clarified previously unclear and controversial regulations harming the whole real estate market. It should enable the desired goal of the legalisation legislation: more and easier legalisation of already illegally built objects and discipline in future construction.

Based on unofficial data, the 2012 legislation mechanism is already showing positive results. Whether this trend continues is yet to be seen, especially as the expiry of the 30 June 2013 deadline nears.

Act on Procedures with Illegally Built Buildings (Zakon o postupanju s nezakonito izgrađenim zgradama, Official Gazette of the Republic of Croatia No. 86/2012 of 27 July 2012).
Certain buildings are by law deemed to have been built on the basis of a building and usage permit (eg, buildings built prior to 15 February 1968).
The 2012 legislation did not adopt the very strict 2011 legislation prescribing that acquisition/disposal of illegally built buildings is null and void.
The deadline for submission of legalisation requests under the 2011 legislation was 31 December 2012. This deadline still stands for illegally built objects for which a removal order is issued and pending.
Not all illegally built buildings may be legalised. Legalisation means that adequate permit(s) may be issued if (i) the legalisation request is submitted by 30 June 2013, (ii) all preconditions are fulfilled, (iii) all required documents are submitted with the request, and (iv) all required fees are paid. It will primarily be the task of the engaged expert (in most cases, licenced architect), eventually supported by other licenced experts (eg, geometer, constructor), to determine whether all preconditions are fulfilled and a legalisation procedure is permissible, and to provide required documentation.