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Rights and registration
What types of holding right over real estate are acknowledged by law in your jurisdiction?
Direct ownership of real estate in Finland grants the owner an exclusive right to:
- possess, use and manage the land; and
- own any components or substances derived from the real estate.
However, some restrictions may limit the owner's rights – for example, planning legislation regarding land use.
Real estate can be jointly owned by more than one person or entity. The co-owners are subject to the detailed provisions set out in the Act on Co-ownership (180/1958, as amended).
Ownership of housing and corporate buildings in Finland is frequently arranged through indirect ownership by way of a limited liability company with the express purpose of owning the relevant real estate, including the buildings on it.
If the land and buildings on it are owned by different persons, the owner of the building or buildings usually has a tenancy right to use the land granted by the landowner under a fixed-term lease.
Are rights to land and buildings on the land legally separable?
If the land and buildings are owned by the same entity, they are in the same real estate unit. Hence, the buildings are not registered as separate units.
Which parties may hold and exercise rights over real estate? Are there restrictions on foreign ownership of property?
Private individuals and legal entities may hold and exercise rights over real estate.
Under Finnish law, there are no general restrictions on foreign ownership or occupation of Finnish real estate. However, in relation to indirect property investment (and as further defined in the Act on the Monitoring of Foreigners' Corporate Acquisitions in Finland, 172/2012, as amended)), foreign buyers must apply for prior approval from the Ministry of Employment and the Economy for an acquisition resulting in the buyer holding more than one-tenth, one-third or one-half of the voting power (or corresponding dominant control) of either:
- a Finnish defence company; or
- any other company or business that holds a key position in relation to maintaining vital functions of Finnish society.
Further, foreign persons are restricted from buying real estate located on the Aland Islands (an autonomous region of Finland), unless specifically allowed by the government of those islands.
How are rights, encumbrances and other interests over real estate prioritised?
Real estate mortgage holders have priority based on the filing date of the relevant mortgage. A mortgage with an earlier filing date is satisfied before mortgages with a later date.
Must real estate rights, interests and transactions be registered in your jurisdiction? What are the legal effects of registration?
Title transfers to the buyer in accordance with the parties’ agreement and is not dependent on registration of the buyer's title. However, a transfer of title must be registered with the Title and Mortgage Register maintained by the National Land Survey of Finland (www.maanmittauslaitos.fi) and prior registration has priority in case of conflicting transfers of title.
Further, certain land lease agreements and transfers of such leases must be registered with the Title and Mortgage Register.
What are the procedural and documentary requirements for entry into the national real estate register(s)? Can registration be completed electronically?
Under the Land Code (540/1995, as amended), title must be applied for within six months of signing a document transferring ownership, such as an acquisition agreement.
It is the buyer's responsibility to provide evidence of the acquisition, by providing the original agreement or a true copy of the agreement certified by an official representative or registration authority.
Electronic documentation and transfer of title are possible through electronic service systems.
What information is recorded in the national real estate register(s) and to what extent is such information publicly available?
The Title and Mortgage Register contains information on, for example:
- ownership of real estate;
- mortgages; and
- rights over property.
Information submitted to the Title and Mortgage Register is public. The registration authorities are obliged to provide certificates from it on request.
Is there a state guarantee of title?
Under the Land Code, the state is liable for damages caused by:
- an obvious spelling or calculation mistake;
- a mistake caused by a technical error; and
- other similar errors or defects in the Title and Mortgage Register's records, or in extracts obtained from the relevant register.
If the damage is caused by an error in the information sent to the Title and Mortgage Register, the damage is not compensated by the state.
Errors in the Land Register are compensated by the registrar.
If an authority other than the National Land Survey of Finland has given an incorrect or inadequate certificate from the Title and Mortgage Register, and the error or defect is not caused by incorrect information in the register, that other authority is liable for compensating any damage incurred.
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