The planned changes in the Construction Law seem
to indicate that the legalization of unpermitted
structures will be even more costly than anticipated
under the current statutory scheme.
In Poland, unpermitted structures are not
automatically subject to demolition.
Instead,
building supervision authorities inspect the subject
property in an effort to legalize it. An order for
demolition is the last resort. At the same time Poland
has two complex statutory schemes for retro-active
permitting fee calculations which apply under
different circumstances. The first applies when the
premises was built without the required building
permit, while the second applies when work was
done without the required notification. Retro-active
permitting fees for structures built without the
required permits are calculated under the Article 49
section 2 of the Construction Law Act of July 7,
2004 (the “Act”). It requires the use of fines
provisions provided for in the Article 59 f of the Act
but the amount calculated thereunder must be
multiplied by 50. The formula contained in the
Article 59 f is as follows; the fine is the product of
the fee (s), the coefficient of the building category
(k) and coefficient of the size of the building (w).
The fee rate according to section 2 of that provision
is 500 PLN. The variable portions are given in an
Annex to the Act. On the other hand, where a
structure was built without proper notice, the steep
fines can range between a 2500 or 5000 PLN
depending on the nature of the construction.
The result is that the legalization of structures build
without the required notice does not carry severe
financial consequences, while legalization of
structures build without the necessary permits may
be simply inefficient. In light of the fiscal
consequences under the statutory scheme above it is
of often more profitable to demolish a structure and
reconstruct one with the requisite permits than pay
the fee. Unfortunately, the fee calculation formulas are not reflective of actual fees paid at the time of the
legalization. For example, the legalization of a shop
or a bar with an area of up to 2500 m 3 is 375.000
PLN, while for a shop between 2500 and 5000 m 3 is
562.500 PLN. The greatest inequity of the current
regulation is that an investor can be expected to pay
the same amount for the construction of a small shop
as for one with an area of 2000 m 3. This is because
under the Annex to the Act, which lists the
categories of the premises, both premises belong to
the same category. This restrictive approach to
charges has resulted in an annual decline in the
legalization of unpermitted structures. In 2009, 681
unauthorized constructions were legalized, while in
2010 it was only 571. In the first half of 2011 this
figure had dropped to 182.
To overcome the apparent inequity in the
construction law a legalization fee of 50 percent of
the value of the premises being built has been
proposed. It is unclear, however, whether the fee
would be calculated based on the value of the work
completed prior to the beginning of the legalization
process or based on the future value of the facility.
The Deputy Minister of Transport, Construction and
Maritime Economy, Mr. Janusz Żbik, stated that
legislation is planned to remove incentives for
unauthorized constructions. Therefore it can be
inferred that the construction department will be
inclined towards the calculation of legalization fees
on the basis of the complete and total value of the
investment project, thus maximizing the amount of
fees for legalization.
As of now, the excessive legalization fees are only
one aspect of the issues with the planned legislation.
There is also no distinction in the levels of
culpability with respect to an investor’s willfulness
in engaging in the unauthorized conduct. It means
that the same as under the current law, investors who
intentionally fail to procure a permit and those who
obtained one but had it revoked for reasons beyond
their control face the same penalties. Therefore the
proposed changes do not affect the heart of the
problem. Moreover, the repressive fee scheme will
likely affect the number of legalizations to a greater
degree.
MILLER, CANFIELD,
W. BABICKI, A. CHEŁCHOWSKI I WSPÓLNICY SP.K.
ul. Batorego 28-32
81-366 Gdynia
Tel. +48 58 782-0050
Fax +48 58 782-0060
gdynia@pl.millercanfield.com
ul. Nowogrodzka 11
00-513 Warszawa
Tel. +48 22 447-4300
Fax +48 22 447-4301
warszawa@pl.millercanfield.com
ul. Św. Mikołaja 7
50-125 Wrocław
Tel. +48 71 337-6700
Fax +48 71 337-6701
wroclaw@pl.millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield. It is intended to provide only a summary of certain recent legal
developments of selected areas of law. For this reason the information contained in this publication should not form the basis of any decision as to a particular course of
action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in individual cases. The services of a competent professional adviser
should be obtained in each instance so that the applicability of the relevant legislation or other legal development to the particular facts can be verified.