Title Registration for Constructed Real Properties Simplified and Shared Construction Laws Amended
Legal Update No 795
Bryan Cave Leighton Paisner (Russia) LLP (formerly Goltsblat BLP in Russia) advises that a Federal Law1 amending the legislation on title registration and shared construction came into force on 13 July 2020.
This Law focuses primarily on clarifying regulation of participation in shared construction, dealing particularly with “problem” properties. A number of clauses simplify administrative and registration procedures: under certain circumstances, pledge of a land plot terminates automatically on state cadastral registration of an Apartment Block2, whereas, under the previous version, the pledge generally terminated once all shared construction projects had been handed over to purchasers.
In practice, certain changes might trigger difficulties: from now on, for instance, information about a construction project must contain all (the word “key” is deleted) the characteristics of the apartment blocks and/or other properties constructed (created) as part of such a construction project, this making the scope of such information somewhat unclear3.
The Law also includes new developments of a general nature.
In our opinion, the most important of these is a limit on the scope of the legal due diligence conducted by the registrar during state cadastral registration and/or state registration of title to constructed buildings, structures, premises or parking spaces. This now involves only verifying whether the technical plan data comply with the capital structure commissioning permit and/or design documentation or the certificate issued by the acceptance commission confirming completion of premises reconfiguration in an apartment block4. The registrar is expressly prohibited from examining whether a commissioning permit issued by the competent authority or organisation or certificates issued by the acceptance commission are lawful. The Law apparently presumes that the authority competent to issue a permit goes strictly by the law (it is responsible for ensuring its own decisions comply with the law) so there is no need to double-check.
Developers definitely welcome the new allowance of a five per cent difference between the area of a commissioned capital structure and that indicated in the design documentation and/or construction permit. Such a difference may not serve as grounds for refusing to issue a commissioning permit or for suspending state registration of title.
Finally, please note that the discrepancies between the Town-Planning Code rule that, should a land plot be split up or carved out, no land plot development plan is required, have been eliminated5.
1 Federal Law No. 202-FZ (the Law) “On Amendments to the Federal Law ‘On Shared Participation in Construction of Apartment Blocks and Other Properties and on Amendments to Certain Legislative Acts of the Russian Federation’ and Certain Legislative Acts of the Russian Federation”
2 Part 8.1, Article 13 of Federal Law No. 214-FZ dated 30 December 2004 “On Shared Participation in Construction of Apartment Blocks ...”
3 Clause 5, Part 1, Article 21 of Federal Law No. 214-FZ dated 30 December 2004 “On Shared Participation in Construction of Apartment Blocks ...”
4 Part 13-15, Article 40 of Federal Law No. 218-FZ dated 13 July 2015 “On State Registration of Real Estate”
5 Part 21.7, Article 51 of the Russian Town-Planning Code.
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