The end of last year saw a reform regarding the authorisation of constructions and urban planning. After a few months, this reform was however cancelled; yet there is still hope for a modern legislation.

Background

On 27.12.2016, the Government Emergency Ordinance no.100/2016 (GEO 100) brought significant amendments to Law no.50/1991 on the authorisation of construction works and Law no.350/2001 on land planning and urbanism. This GEO aimed to provide a more coherent legal framework for the approval of city plans and the issue of building permits with the final goal of ensuring the sustainable development of cities, and less complicated and time-consuming procedures for property development in Romania.

The amendments introduced by GEO 100 were welcomed by practitioners and investors alike. Nevertheless, this GEO was repealed on 05.05.2017 by the Romanian legislator via Law no.86/2017. Surprising as it might seem, this abrogation has been explained by officials of the Romanian Government as being due to the legislator’s intention to completely renew [the old and outdated] Law no.50 on the authorisation of construction works, and to replace it with a new piece of legislation containing a more flexible legal framework adapted to the current market requirements.

The silver lining in the incoherent legislative policy of the Romanian lawmaker is that a reform of the legal framework in the field of city planning and construction authorisation is under way; the positive amendments made by GEO 100 are expected to be incorporated in the new law currently being drafted. Against this background, the main amendments introduced by GEO 100 are:

Use of electronic means in the building permit procedure

GEO 100 expressly regulated the issuing of urbanism certificates by local authorities in electronic form, and the obligation of investors to notify – also in electronic form – the commencement of the construction works to the building permit issuing authority and the State Construction Inspectorate. Furthermore, under GEO 100, all institutions and economic operators competent to issue the approvals and consents necessary for obtaining the building permit according to the urbanism certificate were required to allow applicants to file their documentation and to obtain the requested approvals/consents via electronic means.

Validity of approvals/consents during project implementation

Given that procedures for the approval of city plans or building permits can be quite time-consuming, especially when complex investments are involved, it is not uncommon, in practice, that approvals/consents obtained early in the permit procedure expire by the time investors obtain all other documents needed to file for the approval of the city plan/ building permit. To avoid having to re-apply for such approvals/consents, GEO 100 clarified that approvals/consents remain valid for the duration of the investment until completion of the construction works and signing of the final hand-over protocol.

Procedure for approval of zonal urban plans amended

Zonal urban plans (Rom. planuri urbanistice zonale, PUZ) are often required, in practice, to modify or detail the provisions of the relevant general urban plans, so that the legal requirements can be adapted to the characteristics of a specific investment. GEO 100 introduced a series of amendments concerning the procedure for approving a PUZ, expressly designed to support sustainable city development (eg. an area which is to form the object of the PUZ must be delimited by at least three public roads or by natural elements of the environment, in the case of a PUZ approved for inner-city areas; in the case of a PUZ aiming to extend the existing inner city, the area studied in the PUZ must be at least 5,000 m2).

New sanctions in procedure regarding city plans/ building permits

To accelerate the procedures for the approval of city plans and the issue of building permits, GEO 100 introduced a series of new sanctions for officials, public institutions or economic operators involved in these procedures, such as:

i) failure to submit in good time the city planning documentation for approval, to inform and consult the public as required, or to issue in good time the decision for the approval or rejection of said documentation: these were considered administrative offences carrying fines of up to RON 25,000 or 50,000;

ii) failure to issue the underlying approvals/consents for the building permit was also deemed an administrative offence carrying a fine of up to RON 30,000.

Conclusion

The amendments introduced by GEO 100 concerning the approval of city plans and the issuing of building permits were welcomed by practitioners and investors alike. So the recent repeal of GEO 100 has left many wondering whether there is still hope for a coherent legal framework that would foster dynamic investments and sustainable city development.

The silver lining is that the positive amendments brought by GEO 100 are expected to be incorporated in the new law currently being drafted by the Romanian legislator. Furthermore, some of these amendments have already been put into practice (eg. several local public authorities have announced the issue of urbanism certificates in electronic form). They are also likely to be upheld after the repeal of GEO 100, considering their beneficial impact in practice.

Although no timeframe for the adoption of the new law has been made public, the signs of an upcoming reform are positive.