Purchasing Developement Area in Hungary

According to the Hungarian legal provisions only domestic natural person can obtain the ownership of agricultural land. All local municipalities in Hungary have plans regarding the development of their pheripherial areas.

The areas described in the development plans of the municipalities are mostly agricultural land and are located in the periphery but nearby (or sometimes surrounded by) the municipal area.

The rezoning of the agricultural land (forest, ploughland, garden etc.) to municipal area (residential area, commercial area etc.) belongs to the competence of the local municipality. With regard to Budapest, the municipal plans are bipartite similar to the administration of the capital city.

The Metropolitan Municipality has a so called Frame Plan (Fővárosi Szabályozási Keretterv, abbreviated: FSZKT) while the district municipalities of Budapest have their own regulations regarding their territory.

With regard to the above described two-levelled administration of Budapest the rezoning process of a territory in Budapest can be described as follows.

The district municipality adopts a decree regarding the initiation of the amendment of the Frame Plan by the Metropolitan Municipality regarding the development area.

If the Metropolitan Municipality accepts the initiative it amends the Frame Plan according to the provisions set out in the initiative. After the amendment of the Frame Plan the district municipality accepts the amendment of its regulation with regard to the rezoning of the agricultural land into municipal area (residential area, commercial area etc.).

If an agricultural land is rezoned and used for non-agricultural purposes a so-called soil protection fee is to be paid to the land registry. The amount of the fee depends on the quality of the soil of the rezoned plot.

As foreign nationals are excluded from the purchase of agricultural land, the investment shall carry out by calling in domestic natural person to the business.

There are several contractual constructions which are shaped according to law and makes the purchase of the development area safe and secure for the foreign investor.

Budapest, July 2008

We are kindly at your disposal for the management of your corporate issues in Hungary.

Your Legal Representative:
Dr. Andras Toth-Kalaszi
Attorney-at-law
H-1094 Budapest Berzenczey u. 33.
e-mail: toth.kalaszi@upcmail.hu ; +36 30 538 81 32

Learn more about our Law Firm in Budapest.

Please call or e-mail for further information:
Tel: 0036 30 538 81 32; e-mail: toth.kalaszi@upcmail.hu

DISCLAIMER:
The information contained in this article is provided for general information only. Considering the nature of online advising is inadequate for all-around complete advising Dr. Andras Toth-Kalaszi Law Firm is no responsible for the on-line advices, and it's not amenable to any action.