What does the amendment mean in practice for a foreigner planning to purchase real estate in Poland?
According to the assumptions of the draft, notaries will be required to submit documents concerning the acquisition of real estate by foreigners exclusively in electronic form. The existing paper-based circulation is to be replaced by the transfer of documents through the Central Repository of Electronic Extracts of Notarial Deeds, known as CREWAN.
The proposed change is therefore primarily organisational in nature and is intended to increase control over real estate transactions involving foreigners. Its purpose is to improve supervision over transactions in which foreigners acquire real estate in Poland or acquire shares or stock in companies holding real estate located in Poland.
In our view, the amendment may make it easier for the authorities to carry out inspections more efficiently and to identify more quickly transactions requiring additional verification in terms of compliance with the Polish Act on the Acquisition of Real Estate by Foreigners, including determining whether a permit from the Polish Ministry of the Interior and Administration was required before the agreement was concluded. This has significant practical importance, because the acquisition of real estate by a foreigner in breach of the Polish Act on the Acquisition of Real Estate by Foreigners is invalid by operation of law.
At the same time, according to the information presented in the list of legislative works of the Council of Ministers, the primary source of information for the Polish Ministry of the Interior and Administration about real estate acquired by foreigners consists of extracts of notarial deeds submitted by notaries. Each year, the Polish Ministry records cases of late submission of documents, which affects the certainty of legal transactions involving foreigners and the accuracy of registers of real estate, shares and stock acquired or taken up by foreigners.
How do notaries currently submit documents concerning the acquisition of real estate by foreigners?
The Polish Act on the Acquisition of Real Estate by Foreigners already provides for mechanisms of control over transactions involving foreigners. Pursuant to Article 8a of that Act, notaries are obliged to submit to the minister competent for internal affairs documents concerning the acquisition by a foreigner of ownership or the right of perpetual usufruct of real estate located in Poland.
This obligation also applies to documents connected with the acquisition or taking up of shares, stock, or all rights and obligations in a commercial company that owns or holds the right of perpetual usufruct to real estate located in Poland.
The current deadline for submitting such documents is 7 days. Importantly, the proposed amendment does not abolish this deadline. It primarily changes the manner in which the obligation is performed — from paper-based to electronic.
Are the rules for obtaining a permit from the Polish Ministry of the Interior and Administration changing?
The proposed change does not introduce new substantive conditions for obtaining a permit from the Polish Ministry of the Interior and Administration for the acquisition of real estate by a foreigner. In other words, the available information about the draft Act does not indicate that the permit procedure itself is to be fundamentally restructured.
The key issue remains, above all, the assessment of whether the foreigner needs a permit to acquire real estate in Poland at all. This depends, among other things, on the foreigner’s status, the type of real estate being acquired, its location, and whether one of the statutory exemptions applies.
As a rule, a permit may be issued if the acquisition of real estate by a foreigner does not pose a threat to national defence, state security or public order, and if the foreigner demonstrates circumstances confirming their ties with Poland. We discuss this in more detail in the article: acquisition of real estate by a foreigner in Poland – a comprehensive guide.
Yes. The issue of acquiring real estate by foreigners is not limited exclusively to the direct purchase of an apartment, land, building or share in real estate.
In practice, a foreigner may also gain control over real estate indirectly, by acquiring or taking up shares or stock in a company that owns or holds the right of perpetual usufruct to real estate located in Poland.
For this reason, information and control obligations also cover certain cases of acquiring shares, stock, or all rights and obligations in a commercial company holding real estate in Poland. This is particularly important in investment transactions, holding structures and acquisitions of special purpose vehicles holding real estate.
We discuss this in more detail in the article concerning the acquisition by a foreigner of shares in a company holding real estate in Poland.
What does this mean for a foreigner buying real estate in Poland?
For a foreigner planning to purchase real estate in Poland, the proposed change should not be understood as abolishing obligations or simplifying the entire procedure. On the contrary, the strengthening of electronic control may increase the practical importance of properly preparing and conducting the transaction. A more efficient circulation of documents may make it easier for the authorities to verify whether, in a given case, there was an obligation to obtain a permit from the Polish Ministry of the Interior and Administration and, consequently, whether the acquisition of the real estate was carried out in accordance with the Act.
Before signing an agreement, a foreigner should still verify in particular:
- whether they are a foreigner within the meaning of the Polish Act on the Acquisition of Real Estate by Foreigners,
- whether they benefit from an exemption from the obligation to obtain a permit,
- whether the real estate is located in a border zone,
- whether the subject of the transaction is a residential unit, garage unit, land, share in a road, agricultural real estate, forest real estate or share in real estate,
- whether the transaction concerns the direct acquisition of real estate or indirect acquisition through a company,
- whether it is necessary to obtain a permit from the Polish Ministry of the Interior and Administration before concluding the agreement,
- whether the transaction documents correctly describe the real estate, the parties and the legal basis for the acquisition.
An incorrect assumption that a permit is not required may lead to serious legal consequences. Therefore, the analysis of whether a permit must be obtained should be carried out before signing a preliminary or development agreement, rather than only at the stage of the notarial deed transferring ownership.
A detailed list of issues worth verifying before the transaction is discussed in the article: purchase of real estate in Poland by foreigners – what issues should be checked.
Summary
The proposed changes to the Polish Act on the Acquisition of Real Estate by Foreigners and to the Law on Notaries are primarily organisational and supervisory in nature. Their main purpose is to introduce the electronic submission of notarial documents to the Polish Ministry of the Interior and Administration through the CREWAN system.
Contrary to certain simplifications appearing in public debate, this change should not therefore be presented as a complete overhaul of the rules governing the acquisition of real estate by foreigners in Poland. Rather, it is a strengthening and digitalisation of control mechanisms that already exist under the current legal framework.
For foreigners planning to purchase real estate in Poland, the practical conclusion is straightforward: it is still necessary to carefully verify whether the transaction requires a permit from the Polish Ministry of the Interior and Administration, whether one of the exemptions applies, and whether the acquisition is direct or indirect through a company holding real estate.
