REAL ESTATE

Quarterly 1 - April 2017

Dear Reader,

We produce a quarterly newsletter to keep you updated on legal developments and important trends in the real estate sector. In this issue, we address the following topics:

- Real Estate Investment and Taxation - Hotel City Tax in Brussels - Transfer taxes in case of cancellation of a sale agreement – Status in the three Regions

- Real Estate Management - Overview 2016 case-law on leases - Proposal for a reform of the co-ownership rules - Registration of the property administrator (syndicus / syndic) mandatory as of 1 April 2017

- Real Estate Development - Integrated environmental permit in the Flemish Region - New town planning rules in Wallonia: the CoDT bis

We hope this will be useful to you.

Christophe Laurent

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Hotel City Tax in BrusselsAntoine Béchaimont

In our last Real Estate Quarterly, we mentioned the transfer of the current “City Tax” from the Municipalities to the Region for harmonisation purposes.

The Ordinance entered into force on 1 January 2017 and the tax is due as from 1 February 2017.

Taxpayer and amount of the tax

The tax amounts to 0.0892 EUR per night and per room occupied by a tourist. The rate decreases to 0.0669 EUR in case of home-based accommodation (maximum 5 rooms).

The VAT is charged at a rate of 6% when the tax is recharged to the tourist.

The tax is due on a monthly basis by the operator of the tourist accommodation, but the owner of the accommodation can be jointly liable for the tax if (i) the operator is insolvent (in case of consistent evidences leading to a suspicion of collusion between the owner and the operator), or (ii) the operator remains unknown.

The Ordinance is unclear about the taxation of operator(s) located in Brussels but managing tourist accommodation(s) in the Flemish or the Walloon Region. However, based on the principle of territoriality, Brussels should not be allowed to tax tourist accommodations that are not located on its territory.

Intermediaries as Booking.com and AirBnB shall be invited to provide the Regional tax administration with available information about the operators, subject to penalties.

A “choice” for the Municipalities

At choice, the Municipalities can replace their current City Tax with an additional taxation on the new Regional tax (opcentiemen / centimes additionnels). As the case may be, Brussels shall take care of the collection of the tax on behalf of the Municipalities, for free.

Parliamentary documents explain however that Brussels already agreed on the transfer of the City Tax with all Municipalities for budgetary reasons.

If the City Tax as such is a Regional tax non-deductible expense for corporate income tax purposes in the hands of the taxpayer, the additional taxation to be redistributed to the Municipalities remains deductible for tax purposes.

* * *

Transfer taxes in case of cancellation of a sale agreement – Status in the three RegionsAntoine Béchaimont

Brussels

Following the Flemish and Walloon Regions, Brussels finally introduced the possibility to cancel an agreement related to the transfer of a real estate asset without adverse tax consequences.

Before this possibility, the transfer taxes of 12.50% were due at the signature of the (private) sale agreement, and the reimbursement as such could only occur pursuant to a proper judgment pronouncing the cancellation of the agreement. Moreover, the cancellation without this judgment

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could also lead to the collection of transfer taxes for a second transfer (assumption of sale-back to the initial seller).

- Specific fixed duty of 10 EUR

In case of agreement acting the transfer of (i) the full ownership of a real estate asset, (ii) a right to build, or (iii) an usufruct, parties have one year to submit a mutual cancellation of the agreement to the relevant tax administration.

As the case may be, the mutual cancellation agreement shall be subject to a specific fixed duty of 10 EUR, and the transfer taxes of 12.50% (i) shall not be payable anymore, or (ii) shall be refunded in case they have already been paid to the tax administration.

This new regime is also applicable in case of cancellation by operation of a condition subsequent within one year from the execution of the initial transfer agreement, subject to an authentic deed being submitted to the tax administration.

- Entry into force

This possibility applies to any (private) sale agreement concluded since 29 December 2016. Legal sharing, donation and swap of real estate assets are also aimed by the law.

Flanders and Wallonia

Similar mechanisms already exist since 2007 in the Flemish Region and since 2009 in the Walloon Region: a fixed duty of 10 EUR shall be paid for the (private) sale agreement and for the cancellation agreement. If transfer taxes have already been paid, they can be refunded provided the fulfilment of certain conditions.

The scope of the Walloon regime is slightly broader and the implementation conditions of both mechanisms are not exactly similar but both enable, for some time already and in an easy way, the cancellation of a private (sale) agreement almost for free and without legal proceedings being required.

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Overview 2016 case law on leasesLien Bellinck

Judgement dated 8 January 2016 / Breach of safety, health and housing quality requirements – In its judgement dated 8 January 2016, the tribunal of first instance of East-Flanders (section Ghent) confirmed that in case someone rents out a house which does not comply with the safety, health and housing quality requirements mentioned in article 5, par. 1 of the Flemish Housing Code and article 2, par. 1 of the Residential Lease Act of 22 February 1991, the object of the residential lease agreement is unlawful as contrary to public policy. In such case, the residential lease agreement is incurably void (absoluut nietig / de nullité absolue) and the lease payments must be repaid to the tenant. The tenant must however pay an occupancy fee (bezettingsvergoeding / indemnité d’occupation) for the period during which he/she used the house.

Arrest dated 1 February 2016 / Renewal of commercial lease - Pursuant to article 14 of the Commercial Lease Act, tenants have the right to request the landlord to renew their commercial lease agreements by sending a registered letter or bailiff’s writ as from 18 to 15 months prior to the end of the lease. The request must contain the conditions of the new lease and mention that the landlord will be deemed to agree to the renewal and conditions if he does not respond within a period of 3 months. In the case at hand, the tenant requested the landlord to renew the commercial lease agreement by two registered letters sent in the course of the 18th month prior to the end of the lease. The registered letters were returned unopen, stating “absent” and “not present”. The tenant however waited to inform the landlord about his request for renewal until the end of the 15th month prior to the end of the lease, so that the presumption in article 14 would apply. Given the

fact that the parties had a commercial relationship and kept in touch almost every week,the Court of Cassation ruled in its arrest dated 1 February 2016 that the tenant’s conduct constitutes an abuse of right.

Judgement dated 4 February 2016 / AirBnB - On 4 February 2016, the Justice of the Peace of Bruges pronounced the first judgement in Belgium regarding the lease of premises through AirBnB. It was decided that the putting at disposal of leased premises through AirBnB by a tenant to a third party qualifies as a sublease. Such sublease is not permitted if the law (in the case at hand: article 4, par. 2 of the Residential Lease Act) and/or the principal lease agreement prohibits sublease or the sublease happens without having obtained the prior consent of the landlord.

Arrest dated 29 February 2016 / Precarious occupation – In its arrest dated 29 February 2016, the Court of Cassation confirmed that a landlord can conclude a precarious occupation agreement with his tenant at the end of a commercial lease agreement in order to give the tenant the possibility to sell his stocks and to find another business location. Such precarious occupation agreement does not circumvent the mandatory provisions of the Commercial Lease Act.

Judgement dated 1 March 2016 / Termination of lease – In the case at hand, a couple concluded a lease agreement stipulating that both of them shall be jointly and severally liable for the obligations resulting from the lease agreement. In his judgement dated 1 March 2016, the Justice of the Peace of Aalst (1st subdistrict) confirmed that in case one of the tenants terminates the lease agreement, he or she remains jointly and severally liable for breaches of the lease agreement.

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Arrest dated 3 March 2016 / Liability for loss due to fire – Pursuant to article 1733 of the Civil Code, tenants are liable for damages caused by fire, except if they can prove that the fire is caused without any fault on their part. In its arrest dated 3 March 2016, the Court of Appeal of Liège confirmed that such proof can be “positive” (i.e. proof of the external cause (vreemde oorzaak / cause étrangère)) or “negative” (i.e. proof that the fire could only be caused by an external cause). In the case at hand, the fire was caused by a defect of the internal electrical supply system of the dishwasher in the leased premises. The Court of Appeal ruled that such defect qualifies as a “hidden defect” for which the landlord is responsible (article 1721 of the Civil Code) so that the tenant cannot be held liable.

Arrest dated 29 April 2016 / Renewal of commercial lease – As mentioned above, article 14 of the Commercial Lease Act provides that tenants have the right to request their landlords to renew their commercial lease agreements by sending a registered letter or bailiff’s writ as from 18 to 15 months prior to the end of the lease. The request must contain the conditions of the new lease and mention that the landlord will be deemed to agree to the renewal and conditions if he does not respond within a period of 3 months. In its arrest dated 29 April 2016, the Court of Cassation ruled that the rent proposed by the tenant must be “serious”, that is to say that the rent must be likely to be taken into consideration by the landlord. Moreover, the Court confirmed that, in case renewal occurs due to the absence of any response of the landlord, the conditions of the new lease must comply with the law. Since article 1709 of the Civil Code provides that a lease agreement is “a contractual agreement between a landlord and a tenant under which the tenant obtains the right to use and enjoy (an) asset(s) in return for a regular rent”, it follows that the request for renewal proposing a ridiculously low rent (onbeduidende huurprijs / rent dérisoire) does not comply with the conditions set out in article 14.

Judgement dated 8 June 2016 / Dissolution of commercial lease agreement – In his judgement

dated 8 June 2016, the Justice of the Peace of Westerlo ruled that the dissolution of a commercial lease agreement is not only permitted in case the tenant almost never pays the rent on time, unilaterally changes the destination of the leased premises and does not pay the rental guarantee, but also – and mainly – if the tenant applies for judicial reorganisation under the Act of 31 January 2009 on the continuity of enterprises (Wet betreffende de continuïteit van de ondernemingen / Loi relative à la continuité des enterprises) less than one month after the signing (and even before the entry into force) of the commercial lease agreement. In the case at hand, the tenant did not mention anything about his intention to request judicial reorganisation, nor did he inform the landlord about his distressed financial situation.

Arrest dated 10 June 2016 / Renewal of commercial lease – As mentioned above, article 14 of the Commercial Lease Act provides that tenants have the right to request their landlords to renew their commercial lease agreements by sending a registered letter or bailiff’s writ as from 18 to 15 months prior to the end of the lease. The request must contain the conditions of the new lease and mention that the landlord will be deemed to agree to the renewal and conditions if he does not respond within a period of 3 months. Pursuant to article 16, I, 4° of the Commercial Lease Act, the landlord can refuse the renewal in the event of serious defaults by the tenant during the lease. If the tenant does not agree with the landlord’s refusal, he must bring the case before the Justice of the Peace within a period of 30 days. In the case at hand, the landlord made a claim to dissolve the commercial lease agreement based on the tenant’s failure to fulfil his contractual obligations. The claim was introduced as reply to the tenant’s request for renewal and was filed within the period of 3 months as mentioned in article 14. In its arrest dated 10 June 2016, the Court of Cassation ruled that the landlord’s claim to dissolve the commercial lease agreement must be considered as a valid refusal of the tenant’s request for renewal.

* * *

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Proposal for a reform of the co-ownership rulesLien Bellinck

On 7 March 2017, a special working group, appointed in 2016 and consisting of professors, members of the Federal Public Service for Justice and representatives of interested parties (e.g. the Royal Federation of the Belgian Notaryship, the Institute for Real Estate Agents, the Confederation for the Real Estate Professions Flanders), presented numerous policy recommendations on the reform of the co-ownership rules laid down in article 577-3 and following of the Belgian Civil Code to the Minister of Justice.

The working group aims to improve and modernise the functioning of the co-ownership rules and to meet some difficulties encountered in practice.

In general, the policy recommendations are based on the following principles:

1. flexibilisation of the functioning of the association of co-owners in order to prevent deadlock situations in the decision-making process;

2. increase the efficiency within the association of co-owners;

3. rebalancing of the relationships within the co-ownership itself;

4. clear and consistent rules.

At this stage, it is not clear when the new act amending the current co-ownership rules must be expected.

* * *

Registration of the property administrator (syndicus / syndic) mandatory as of 1 April 2017Lien Bellinck

Pursuant to a Royal Decree dated 24 March 2017, every association of co-owners will be obliged to register (the name and other identity data of) its property administrator (syndicus / syndic) in the Crossroads Bank for Enterprises as of 1 April 2017.

As a result, every interested party will be able to check who is the property administrator of a certain property in co-ownership. In addition, it will be easier to trace property administrators who do not exercise their profession in a legal way and to collect statistic data about property administrators in general.

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Integrated environmental permit in the Flemish RegionJasper Verberckmoes

On 23 February 2017, the Flemish Decree of 25 April 2014 on the integrated environmental permit (the Integrated Environmental Permit Decree) and its implementing order of 23 February 2016 finally entered into force. The Integrated Environmental Permit Decree simplifies the existing permit system in the Flemish Region as it incorporates and replaces the previously applicable procedures to obtain building permits (stedenbouwkundige vergunning), allotment permits (verkavelingsvergunning) and environmental permits (milieuvergunning).

By the incorporation of said three permits, the integration process has only just begun… Soon, as from 1 January 2018, the integrated environmental permit will cover the retail activity aspects of the project as well. Moreover, it is expected that in the future similar integration will take place for other permits such as the nature permit (natuurvergunning) and the authorisation for chopping (kapmachtiging).

As a consequence, the performance of works or the operation of classified and/or retail activities, shall no longer require to file applications separately following the appropriate procedure. In accordance with the integrated environmental permit procedure, it is sufficient to file only one application in order to obtain one permit covering the entire project. Such an application will trigger one single public enquiry (openbaar onderzoek) and will result in the joint evaluation and, as the case may be, the autorisation of all requested urban planning, environmental, allotment and/or retail activity aspects of the project.

To ensure qualitative decision making, the Integrated Environmental Permit Decree

provides for two special advisory bodies, i.e. a regional integrated permit commission (GOVC - gewestelijke omgevingsvergunningscommissie) and a provincial integrated permit commission (one per province) (POVC – provinciale omgevingsvergunningscommisie), that are competent for advising in certain cases (most complex and large projects) as determined by the Flemish Government.

To avoid any misunderstanding, it should be underlined that the Integrated Environmental Permit Decree includes new legal framework as to procedural aspects exclusively. The substantive criteria for an application (is a permit required for the project in question?) and the evaluation of the application (will the competent authority grant the permit and if so, under which modalities?) remain reflected in the specific sectoral rules 1.

The utmost important changes/innovations resulting from the Integrated Environmental Permit Decree are set out below.

Which authority is competent to decide on your firm’s project?

The authority which is competent to receive an integrated environmental permit application and to decide on such an application, is determined by the nature and size of the project. Under the Integrated Environmental Permit Decree three authorities could be competent: the Flemish Government, the provincial council and the Municipality through the Bench of mayor and aldermen.

- The Flemish Government is competent for an exhaustive list of strategic projects, such as for

1 The Flemish Urban Planning Code (Title V – Permits),

for town-planning matters and the Flemish decree of 5 April 1995

containing general provisions on environmental policy (Title V –

Operation of establishments and activities and recognitions)

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example permit applications for office buildings with a useful floor surface of at least 50,000 m² located elsewhere than in Ghent or Antwerp (the Flemish Projects) as well as for those works or activities taking place on the territory of two or more provinces.

- The provincial council is competent for an exhaustive list of provincial projects such as for example permit applications for buildings with a useful floor surface, for commercial purposes, of at least 15,000 m² located outside the central cities2 (the Provincial Projects), for works or activities taking place on the territory of two or more municipalities as well as for Class 1 establishments or activities which are not considered to be Flemish or Municipal projects, nor a part thereof.

- The Municipality has residual competence meaning that it shall be competent for most of the permit applications and more in particular for those projects not falling under the competence of the Flemish Government or the provincial council (the Municipal Projects).

What procedure should be followed? What is the time to permit?

- Permit procedures

The Integrated Environmental Permit Decree provides for two possible first instance procedures being (i) an ordinary procedure (with public enquiry) and (ii) a simplified procedure (without public enquiry).

The simplified procedure will only apply in a limited number of cases e.g. for limited changes to an already permitted project, for a project that only includes certain temporary activities or facilities, for acts performed in accordance with town-planning regulations embedded in a spatial execution plan (ruimtelijk uitvoeringsplan), a particular construction

2 Aalst, Antwerp, Bruges, Genk, Ghent, Hasselt, Kortijk,

Leuven, Mechelen, Ostend, Roeselare, Sint-Niklaas and Turnhout

plan (bijzonder plan van aanleg) or a non-lapsed allotment (niet vervallen verkaveling), enacted by the Municipality or the province, and for nearly all projects on residential houses.

In addition to this, the Integrated Environmental Permit Decree provides for two possible appeal procedures being (i) an administrative appeal and (ii) a jurisdictional appeal.

For decisions taken in first instance by the Bench of mayor and aldermen, an administrative appeal is open with the provincial council. For decisions taken in first instance by the provincial council, an administrative appeal is open with the Flemish Government. For decisions taken in first instance by the Flemish Government, there is no administrative appeal open. For all decisions taken in final instance, the Integrated Environmental Permit Decree provides that a jurisdictional appeal is open with the Counsel for Permit Disputes (Raad voor Vergunningsbetwistingen), which will be competent not only to decide on town-planning but (as an innovation) also for environmental aspects.

- Time to permit

The Integrated Environmental Permit Decree provides for short decision periods. The table below summarises the time frame for the first instance procedures as well as for the procedure of administrative appeal.

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If no decision has been taken within due time by the competent authority in first instance, the application for an integrated environmental permit shall be deemed to be refused. This principle applies to both the ordinary and the simplified procedure. If no decision has been taken within due time by the competent authority in final administrative instance, the appeal(s) is (are) deemed to be rejected and the disputed decision shall be considered as final.

Important note: The ‘Codextrein’3 (not in force yet) provides for a system pursuant to which authorities that exceed the foreseen decision period risk to be sanctioned. In this system distinction is made between:

1. the expiry of a decision period in a permit procedure where administrative appeal is open (first instance procedures); and

2. the expiry of a decision period in a permit procedure where jurisdictional appeal is open with the Council for Permit Disputes exclusively (procedures in final administrative appeal, first instance procedures with the Flemish Government and notification procedures).

3 Voorontwerp van decreet houdende wijziging van

diverse bepalingen inzake ruimtelijke ordening, milieu en

omgeving; VR 2016 2511 DOC.1281/3BIS (“Codextrein”); De

Codextrein werd voor de tweede keer principieel goedgekeurd

door de Vlaamse Regering op 25 november 2016 en ligt nu voor

advies bij de Raad van State.

Ordinary permit procedure Simplified permit procedure Administrative appeal procedure

No advice from POVC/GOVC:

105 days

Advice from POVC/GOVC: 120 days

Extension of period: 60 days

- By operation of law:

• second public survey

• administrative loop

• roadworks

- at the request of the applicant

60 days Appeal against decision ordinary

permit procedure: 120 days

Appeal against decision simplified

permit procedure: 60 days

Extension of period: 60 days

- By operation of law:

• second public survey

• administrative loop

• roadworks

- at the request of the applicant

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1. Permit procedure with administrative appeal open 2. Permit procedure with jurisdictional appeal open

Lump-sum fee of:

• EUR 2,500 (simplified procedure)

• EUR 5,000 (ordinary procedure)

Penalty of:

• EUR 500/day (5,000 after 10 days if request is

submitted by one single person)

• EUR 100/day (notifications)

Both lump sum fee and penalty are to be requested within ninety (90) days following the expiration date. If duly requested, amounts will be due until the competent authorities have taken their decision.

With regards to the second category of permit procedures, if no request has been filled within due time, the applicant/appellant will be deemed to have definitively renounced its appeal/permit application as well as its rights on penalty payment. The decision taken in first instance will become enforceable as from the 100th day following the expiration of the initial decision period, as the case may be.

What if your project includes building and environmental aspects, but the ultimate destination is not known yet?

Regardless of the type of permit procedure (ordinary or simplified permit procedure), the permit application must include town-planning and environmental aspects in case the contemplated project contains both the performance of works and/or the operation of classified activities and provided that these aspects are inextricably linked to each other (e.g. hotel, swimming pool). However, in case the project relates to a multifunctional building of which the final destination is not known at the moment of application, the applicant is allowed to file an application, in first instance, for the building and, subsequently (as soon as the final destination is known) for the environmental matters.

What if, during the integrated permit procedure, an irregularity is made that can lead to the annulment of the permit decision?

The Integrated Environmental Permit Decree introduces the concept of ‘administrative loop’ (administratieve lus). This administrative loop allows

the competent authority to rectify certain irregularities that could lead to the annulment of the permit decision. In that case, the competent authority can decide to organise a second public enquiry and it can request the advice of the integrated permit commission or the advisory bodies for a second time.

For what term will the integrated environmental permit apply?

In contrast to the previously applicable environmental permit for classified activities which was granted for a maximum period of twenty (20) years, the integrated environmental permit will be granted, in principle, for an indefinite term. This innovation must ensure more legal certainty (business investment shall no longer require the permit holder to take into account the future expiry of its permit) and economic advantages (costs resulting from application for renewal or new permit can be saved) for the permit holders.

However, the Integrated Environmental Permit Decree contains a short, exhaustive list of cases where the integrated environmental permit may be granted, wholly or partially, for a fixed term, such as, for example, (i) at the request of the applicant, (ii) for exclusively temporary facilities or activities or (iii) to take into account the area specific development perspectives embedded in a spatial structure plan (ruimtelijk structuurplan) definitively established before the moment of filing the application. Note that, in this latter case, the integrated environmental permit will be deemed granted for an indefinite term if, upon the expiry of the definite term, the area specific development perspectives are not embedded in a definitively established spatial execution plan (ruimtelijk uitvoeringsplan).

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Does the permanent character of the integrated environmental permit (as a matter of principle) mean a safe-conduct for permit holders? Absolutely not. In order to guarantee that the protection of man and the environment shall not be prejudiced, the Integrated Environmental Permit Decree goes along with flanking measures in the form of (i) evaluations of permitted activities established by the Flemish government and (ii) consultation opportunities for the public and advisory bodies at the end of each twenty-year period.

What about existing permits? Are they still valid?

Yes. As a matter of principle, existing permits, decisions on notifications and recognitions, granted under previously applicable legislation, remain valid.

The Integrated Environmental Permit Decree furthermore provides that the environmental permits granted since 10 September 2002 for a period of twenty (20) years can be considered as being granted for an indefinite term if cumulative conditions are met:

- the permit holder or the operator of activities must submit a conversion request with the competent authorities between the 48th month and the 36th month prior to the permit’s expiration date. For this conversion request a standard form shall be used.

- no objection was made by the public nor by any advisory body during the public survey or during the period of thirty (30) days following the first day after submitting the conversion request.

- the town-planning related matters which are necessary for the operation of the relevant classified activities or establishments are principally authorised (hoofdzakelijk vergund) at the moment of the conversion request.

- the conversion request does not require

an environmental impact assessment (milieueffectrapport) nor an appropriate assessment (passende beoordeling).

Application in time

Thursday 23 February 2017 remains the crucial date for the entry into force of the large majority of provisions of the Integrated Environmental Permit Decree. However, at present there are four exceptions to this principle. While three exceptions are rather “academic4”, the fourth exception is important as it relates to the fact that municipalities under certain conditions have the possibility to (partially) postpone the implementation of the Environmental Permit Decree up to a date between 24 February 2017 and 1 June 2017. Out of the 308 Flemish municipalities, only 6 will effectively implement the Decree as of 23 February 2017 and 302 decided to postpone the implementation date with a few months5.

* * *

4 These three exceptions relate in essence to the entry

into force of the Decree’s provisions on (i) definitions, (ii) the

appointment of “integrated permit civil servants”, and (iii) the

periodical evaluations of facilities covered by an integrated permit

regarding certain operational aspects.

5 See www.omgevingsloket.be (status per 20 February

2017): only the communes Dilsen-Stokkem, Herstappe,

Langemark-Poelkapelle and Staden will implement the Decree as

of 23 February 2017. Beersel and Diest will implement the Decree

as of 18 April 2017 and 2 May 2017 respectively. All other 302

communes will implement the Decree as of 1 June 2017.

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New town planning rules in Wallonia: the CoDT bisMartin Manzanera

Introduction

On 1 June 2017, the new territorial development code (Code du développement territorial, hereafter CoDT) shall enter into force after one-year waiting period. The works to update the CWATUP started in 2009 and did not go smoothly, since a first text was adopted in 2014 but never left the parliament. The new CoDT (known as CoDT bis) takes as much as possible into account the great expectations of citizens, municipalities and investors with, at the end, more efficiency, simplification, predictability and legal security.

New plans and schemes

The biggest issue dealt with by the CoDT bis was to propose some innovations regarding territorial plans and schemes. It is useful to remind that plans have classically a mandatory value, while schemes are indicatives. However, schemes are one of the most important tools available for municipalities to take planning decisions. The more decentralised is the relevant authority, the more local and precise is the adopted plan.

The new territorial strategy will now rely on four new schemes (with an indicative value), which will replace and complete the existing ones:

- the SDT (schéma de développement territorial);

- the SDP (schéma de développement pluricommunal);

- the SDC (schéma de développement communal); and

- the SOL (schéma d’orientation local).

The SDT covers the regional level and, as the other schemes, is aimed to define a contextual strategy in short and long-term. The SDP and SDC respectively concern a pluri-municipal level and a municipal level, but cannot overlay each other. The SOL only deals with local issues and will replace the current RUE

(Rapport Urbanistique et Environnemental) that had an indicative value, but also the current PCA (plan communal d’affectation) that had a mandatory value. In this context, it can be noted that as from the entry into force of the CoDT bis, the owners of a plot of land bigger than 2 hectares will be empowered to request the adoption of a SOL.

Besides these schemes, the Plan de Secteur remains unchanged, except for two new zones: the ZER (zone d’enjeu régional) and ZEC (zone d’enjeu communal). They are designed to allow the government and the municipalities to lead actions of prior interest in economic, social, environmental, cultural, athletic, recreational and tourism development.

In a spirit of flexibility, the new tools created by the CoDT bis have an indicative value. However, this indicative value is more complex than it seems at first sight. Indeed, to depart from an indicative scheme, two specific conditions must be respected:

- not compromise the achievement of the town planning objectives; and - contribute to the protection, management or planning of the built or natural landscape.

To derogate from a plan (with mandatory value), the three conditions set out in the CoDT bis are similar to the conditions of the CWATUP:

- justify the specific nature of the project;- respect the general economy of the Plan de Secteur; and - contribute to the protection, management or planning of the built or natural landscape.

Finally, under the CoDT bis, the exceptional nature of the derogation has been abrogated.

Permits deadlines and procedure

The CoDT bis also tries to resolve the persistent problem of deadlines for permits. Various surveys revealed that lots of urbanisation and building permits are not delivered in due time. The CoDT bis sets strict deadlines:

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- From 30 days to 115 days when the municipality is competent to take the decision; and- From 60 to 130 days when the delegated official is competent.

These periods of time start to run after confirmation of the reception of the permit application by the relevant authority, or after 20 days if the reception of the permit application has not been confirmed. It is important to note that if an application has been twice qualified as incomplete, it shall be inadmissible.

Unlike the provisions contained in the first version of the text, the CoDT bis does not provide for tacit refusal if no decision has been rendered after expiration of the decision period. The new procedure has been organised in a way that there will necessarily be a decision:

- When the advice from the delegated officer is required, and if the municipality does not decide in due time, the advice will constitute the decision. Furthermore, if the delegated officer has failed to deliver its advice, the case is transferred to the Walloon Government.

- When the advice from the delegated officer is not required, and if the municipality fails to decide, the delegated officer becomes competent to take the decision. If he fails as well, the case is transferred to the Walloon Government.

Town planning infringement

The town planning infringement regime has been drastically simplified:

- a list of non-fundamental infringements has been set up, for which the statute of limitation is limited to 10 years;

- the owner of the irregular constructions has the possibility to make the necessary repairs before receiving the official notice of infringement;

- a regularisation permit may be asked and delivered at the same time of the payment of the administrative fine; and

- a conciliation meeting can be organised between the infringer and the authorities in order to appreciate the seriousness of the situation.

Miscellaneous

Some simplifications with regards to permit applications are warmly welcomed, i.e. the extension of the list of works exempt from building permit or from the necessity to consult an architect. However, these exemptions are not applicable for the buildings listed in the safeguarding list.

On the contrary, the CoDT bis introduces new operative events e.g. the modification of the repartition of the sale surfaces in a building. The municipalities are also empowered to create new operative events by reference to their town planning guide.

Finally, the possibility to organise project meetings with the relevant authorities is extended to the building permit, the urbanisation permit, the environmental permit and the socio-economic permit. These project meetings are even made mandatory in certain circumstances.

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Contact

Christophe Laurent

Partner

T +32 2 743 43 05

christophe.laurent@loyensloeff.com

Ariane BrohezPartnerT +32 2 743 43 21ariane.brohez@loyensloeff.com

Sophie Van BerkelProfessional Support LawyerT +32 2 773 23 41sophie.van.berkel@loyensloeff.com

Contributors to this issue

Lien BellinckAssociateT +32 2 773 23 36lien.bellinck@loyensloeff.com

Martin ManzaneraAssociateT +32 2 743 43 02martin.manzanera@loyensloeff.com

Antoine BéchaimontAssociateT +32 2 700 10 39antoine.bechaimont@loyensloeff.com

Jasper VerberckmoesAssociateT +32 2 700 10 26jasper.verberckmoes@loyensloeff.com

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