New Legal Notice allows for the extension of commercial emphyteutical concessions by application

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The Ministry for Transport, Infrastructure and Capital Projects, has recently published Legal Notice 369 of 2020, entitled “Extension of Temporary Emphyteusis in a Contract for a Commercial Premises Transferred from the Government, the Lands Authority or Ecclesiastical Entities by Title of Emphyteusis Regulations, 2020”.

According to these new regulations, as of the 5th of October 2020, any natural or legal person who enjoys a title of temporary emphyteusis over a commercial property, which property must have been transferred to such person from the Government; the Lands Authority; or an Ecclesiastical entity (which subsequently passed on the title to the Government), can now apply to the Lands Authority to be granted a new contract if the term of concession currently in operation is to expire after the 31st of August 2025.

The applicant can apply to the Lands Authority to rescind the contract currently in operation, and to grant a new contract holding a title of temporary emphyteusis, the term of which shall be equivalent to that in force. However, where the term of the concession in force is greater than sixty-five (65) years, then the term of the new concession shall be equivalent to sixty-five (65) years. With each application, a payment of €1,000 is due, apart from other expenses. The new contract shall be done by public deed.

In order to be granted this new contract, the applicant must prove that the land is needed for a commercial project which would benefit the national economy and generate adequate employment. In order to do this, the applicant must provide a detailed business plan which shall include: a brief description of the project and the product and services that shall be offered; a summary of the objectives; a solid description of the market; a high level justification of the project’s viability; a snapshot of its growth potential; and an overview of the funding requirements. Proof must also be shown that there are no outstanding ground rent payments due to the Lands Authority.

Furthermore, documents required together with the application include: a copy of the original contract; a copy of the last ground rent receipt of payment; a copy of all the contracts concluded since the time when the last emphyteuta was recognised by the Authority if applicable; a detailed plan and a scanned plan duly certified by an architect; a copy of property or site plan certified by an architect; a copy of applicant’s identity card; and photos indicating the current state of the property. The applicant must also submit a sworn declaration of the veracity of the entire contents of the application, also confirming that no information or other relevant facts have been omitted.

The Authority shall have the right in its sole absolute discretion, to refuse and reject any application. Such rejection or refusal shall be in writing and shall include the detailed reasons for its decision. The Authority shall have the right to terminate the application process undertaken pursuant to these regulations, at any stage or else to refuse to accept any application if it is of the view that such property is situated in a place of national importance. Furthermore, every contract done pursuant to these regulations shall be subject to the approval of the House after a special resolution of the House in accordance with article 31(c) of the Government Lands Act.