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The Fate Of Building Permits Following The Cancellation Of The Zonal Urban Plan Of The 2nd District

The Fate Of Building Permits Following The Cancellation Of The Zonal Urban Plan Of The 2nd District

Romania
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On 7 June 2023, Bucharest Tribunal annulled, in the first instance, the zonal urban plan („ZUP”) of the 2nd District and suspended its effects until the final resolution of the case file, noting that it reduced green spaces, allowing the construction on tens of hectares of such areas, including areas occupied by parks, lakes, sports fields, etc. The case file is currently in appeal before Bucharest Court of Appeal[1].

For context, it should be reminded that in November 2022, Bucharest Tribunal rejected, in first instance, the action initiated by Ecopolis Association to suspend ZUP of the 2nd District. As a result of such rejection of the case file, the local authorities of 2nd District considered that the ZUP of the 2nd District, approved by Bucharest General Council Decision no. 339/13.08.2020 continued to produce its effects, so they resumed issuing building permits for application that had complete documentation. Moreover, there is an older dispute between the General City Hall of Bucharest, on one side, which claimed that it was forbidden to issue urban planning certificates and building permits under the ZUP of the 2nd District because it had been suspended by the court, and the City Hall of the 2nd District, the State Construction Inspectorate and Bucharest Prefecture, on the other side, which supported the continuation of the procedures for issuing building permits for all requests registered with the city halls until the date of the suspension of the ZUPs, as well as for real estate projects that received a planning certificate before the suspension of the ZUPs.

Following the cancellation of the ZUP by decision of 7 June 2023, the General Mayor of Bucharest, as a representative of the Municipality of Bucharest, communicated to the Mayor of the 2nd District the intention to control the legality of a number of 397 building permits issued during November 2022 – May 2023, building permits for which prior complaints were previously filed. From the available public information, it seems that during September 2023, the General Mayor of Bucharest filed separate actions with the court of law to cancel the above-mentioned building permits.

Recently, the Supreme Court established, through an interpretation decision[2], that the local council’s decision approving the ZUP represents an administrative act with a normative character. According to the law[3], a final court decision by which an administrative act with a normative character was annulled, in whole or in part, produces effects only for the future. The previously mentioned rule knows the exception according to which the final court decision by which an administrative act with a normative character has been annulled, in whole or in part, produces effects also with respect to the individual administrative acts issued pursuant to it, which, on the date of the final annulment decision, are contested in cases pending before the courts of law[4].

On one hand, the General Mayor’s approach to challenge the legality of a number of 397 building permits issued by the 2nd District City Hall between November 2022 and May 2023 suggests that he intends to avail himself of the mechanism described by the Supreme Court, by which can cancel individual administrative acts (i.e., building permits) issued on the basis of an administrative act with normative character definitively canceled (i.e., ZUP of the 2nd District).

On the other hand, beyond the uncertainty of the finality of the court decision canceling the ZUP of the 2nd District, in the litigation filed by the General Mayor for the cancellation of building permits, it will arise the question of his competence to verify the legality of some building permits issued by another local authority. According to the applicable law, the General Mayor does not have the competence to verify the way of issuing building permits, the powers of local authorities being limited to the control of construction discipline, which concerns the implementation of the provisions contained in the building permits. The State Construction Inspectorate is the only  public authority competent to verify and sanction illegal acts consisting in the issuance of building permits in the absence or with non-compliance with the provisions of urban planning documentations (i.e., ZUP) or on the basis of incomplete documentation or developed inconsistently with the provisions of the planning certificate, of the Civil Code, of the framework content of the technical documentation – D.T. for the authorization of the execution of construction works, which do not contain the necessary legal approvals and endorsements or which are not verified according to the law.

In the context of the numerous pre-existing disputes, the latest court actions risk creating a new chapter in the “General Mayor vs. the State Construction Inspectorate” conflict, with the former claimingattributions within the area of exclusive competence of the State Construction Inspectorate.

[1] https://portal.just.ro/2/SitePages/Dosar.aspx?id_dosar=300000000941471&id_inst=2

[2] Decision of the Supreme Court – Panel for resolving the appeal in the interest of the law – no. 12 dated 28 June 2021, published in the Official Gazette, Part I no. 933 dated 30.09.2021.

[3] Art. 23 of the Administrative Law no. 554/2004 – Final court decisions by which an administrative act with a normative character was annuleed, in whole or in part, are generally binding and have power only for the future.

[4] Decision of the Supreme Court – Panel for resolving some legal issues – no. 10/2015, published in the Official Gazette, Part I no. 458 dated 25.06.2015.

By Oana Albota, Partner, Mihai Macovei, Senior Associate, and Miruna Pioara, Associate, Albota Law Firm

Albota Law Firm at a Glance

The firm: Albota Law Firm is a boutique law firm set up in May 2014. The firm was founded by Oana Albota. Before this, Oana co-ordinated, as a partner, the real estate practice of PeliFilip, which she joined from NNDKP.

The main area of practice of the law firm is real estate and construction. It has the capabilities to assist clients in all the areas connected to a real estate project: financing, real estate permitting and regulatory, corporate commercial, litigation and arbitration.

Clients choose the firm because they appreciate the clarity of its advice, its focus on results, and the efficiency of its service and its fast reaction time, all at a very fair price.

The small size of the firm is a huge advantage as it eliminates formalism, it ensures the thorough involvement of a specialised partner in every project at the law firm, the close co-ordination of the team of lawyers and it guarantees a proper cost control.

The quality of the legal services derives from the firm’s market knowledge and excellent legal know-how.

During the last 15 years the firm’s lawyers have been involved in transactions standing as landmarks for the real estate market in Romania and in significant international construction arbitrations.

Areas of practice: The firm specialises in construction and real estate.

It is experienced in all construction sectors and in the engineering industry. It is particularly specialised in FIDIC contracts and FIDIC adjudication.

Its expertise in the real estate area includes the structuring of transactions from acquisition of real estate properties in Romania up to the exit point, planning, development, leasing and financing of real estate projects, land use, private-public partnership in real estate projects, agricultural, forestry, energy and infrastructure projects, and regulatory matters.

It offers banking and finance services, advising borrowers, funds and investors from the point of term sheet and structuring stage, through closing, trenching and securitisation, administration and restructuring.

With a solid understanding of the Romanian law and an impressive experience in corporate and commercial, it assists clients, from the very first steps of the incorporation of a company until the exit, with the company’s day-to-day business, providing all legal advice required to help them stay in full compliance with Romanian rules and regulations.

It offers clients comprehensive advice at every stage of a conflict, in all forms of dispute resolution including: litigation, arbitration, mediation, conciliation and adjudication. It provides services covering assistance in complex commercial disputes before law courts and assistance in arbitration and alternative dispute resolution.

Firm's website:

www.albota.ro