The Government of the Republic of Serbia recently took a significant step in redefining the rules regulating construction activities in Serbia by proposing amendments to the Law on Planning and Construction. If adopted, this will introduce significant changes and breakthroughs for both individuals and the industry as a whole.
A summary of the most important proposed changes and goals is as follows:
Conversion Fee – No more
Arguably, the most significant (and controversial) change is the near-complete abolition of the fee for converting the right to use land into ownership. It is proposed that compensation for conversion will be abolished, except for a specific limited group of individuals whose position will be determined by special regulations. For those relieved of this obligation, the procedure is relatively straightforward and is reviewed based on an initial request to the Agency for Spatial Planning and Urbanism. If approved, the agency will instruct the competent Cadastral Registry Office to carry out the conversion and ex officio register the ownership in favor of the former usage right holder. It is argued that the abolition of the conversion fee will free up numerous locations that will be eligible for sale, thereby enriching the real estate market. Additionally, it will be easier for existing usage rights holders to be able to plan further development projects and obtain the necessary permits.
The “Green Agenda”
One of the amendments’ aims is to ensure sustainable and efficient construction practices by introducing mandatory “green certificates” for all new buildings exceeding 10,000 square meters (GBA). While other investors are not obliged to obtain these certificates, they are encouraged to do so because of incentives such as a 10% discount on the total amount of contribution for urban development. The amendments also require the acquisition of energy passports for both public and private buildings, with different timetables specified for building owners to obtain these passports. Finally, all investors will be obligated to prepare and submit valid proof documenting the movement and proper management of construction waste throughout the construction process so as to prevent the creation of unsanitary landfills.
The amendments introduce “electromobility” into Serbia’s legal system, referring to the use of electric vehicles. Urban-zoning plans will now define the conditions and requirements for the establishment of a minimum number of charging stations for electric vehicles in both public and private buildings and facilities. Existing and future gas stations will have certain grace periods. These changes aim to promote the use of electric cars and facilitate the transition from fossil fuels to renewable energy sources in Serbian society.
Update of Permitting Procedures
One of the amendments’ aims is to provide an alternative to the e-government procedures for investors. This will enable them to bypass the unified electronic procedure and obtain location conditions directly from the relevant public utility company. Also, investors planning construction exceeding 20,000 square meters will now have the choice to obtain construction permits either locally or before the Ministry for Construction. If delayed for more than 30 days locally, the investor may directly approach the Ministry and request the issuance of the awaited permit. Information on locations will now also be issued by public notaries or other registered entities/individuals.
Introduction of New Authorities, Positions, and Registries
The amendments recommend the establishment of the Agency for Spatial Planning and Urbanism of the Republic of Serbia. In addition to standard responsibilities, this agency will also be responsible for establishing and managing the Central Register of Planning Documents. It will also maintain the electronic system called E-Space regarding urban planning documentation. The concept of listing brownfield locations is also proposed. Local councils will collect and provide information on locations not used for a long time to the agency within six months. The agency will compile a data register on these brownfield locations and publicize it. Finally, as well as formalizing the position of a Project Manager, the amendments also propose the establishment of a new official state position – the General Urban Planner (GUP). The GUP will be the highest urban-planning authority, responsible for ensuring the harmonization of the urban-planning documents throughout the country.
By Djordje Nikolic, Founding Partner, and Luka Aleksic, Senior Associate, NKO Law