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The Protection Of Confidence In Veracity And Integrity Of The Land Registry

The principle of the protection of confidence in veracity and integrity of the land registry protects the bona fide real estate acquisitor when he/she acts with confidence in land registry, and in addition doesn’t know that the actual state is somewhat different from the Land registry state. The Law on Ownership that introduced this principle in the Croatian legal system entered into force on January 1^st 2007.

However, because of the extremely large number of parcels still registered under social ownership, and their unregulated land registry status, the rule of this principle has been delayed in several occasions. First prorogation was until 01^st January 2010. However, in the end of 2009, the law had changed and the rule of this principle is now delayed until 01^st January 2015. This means that the protection of confidence in veracity and integrity of the land registry doesn’t apply in favour of the acquisitions incurred by 01^st January 2015, if the real estate registered under social ownership is acquired, and this ownership wasn’t erased before the Law on ownership had entered into force.

Exceptionally, the protection of confidence in veracity and integrity of the land registry applies from 01^st January 2007 on real estate in cadaster municipalities for which the EDP land registry (electronic data processing) is opened and as well on real estate that are, according to certain provisions of the Law on Land Registry, registered in the Land database. 

NEW ENFORCEMENT PROCEEDINGS ACT

New enforcement proceedings act, i.e. most of its provisions, enters into force on July 1st 2012. A new institute of public bailiff is introduced in the enforcement system of the Republic of Croatia with the main mission of executing the enforcement.

Motion for enforcement is filed to, as by now, the public notary or the court. The enforcement order issued by the court or the public notary is then referred to the public bailiff who then issues a „warrant of execution“ necessary for the execution of the enforcement order. Enforcement cases, in which the court didn’t take any action by the end of 2011, shall be sent directly to the public bailiff’s chamber in order to speed up the enforcement proceedings.

The public bailiff (the enforcement authority) is the one deciding on enforcement delays, and no longer the court. The conditions for a delay are also changed so now the enforcement debtor, in order to delay the enforcement, must pay the bail which amounts capital plus interests, all with the purpose of preventing often enforcement delays.

    The enforcement debtors can no longer file complaints against enforcement orders and in that way furthermore delay the proceedings. The appeal is the only possible legal remedy against the enforcement order and the warrant of execution and it doesn’t delay the proceedings. The court decides on the appeal.

    The enforcement creditors’ protection in the enforcement proceedings is enhanced with the new possibility of holding the third auction hearing. On the second and third auction hearing the real estate shall not be sold under ½ of its value, in difference to today’s 1/3 of its value paid on the second auction hearing.

RENTING THE APARTMENTS IN CROATIA

Legal and natural persons are able, under certain conditions, to rent the apartments in Croatia situated in their private houses. They can rent maximum of 8 rooms or 16 beds. However, there are certain limitations for foreigners, for both physical and legal persons

Limitations regarding physical persons limit, for now, the possibility that foreign citizens rent the apartments in their private houses. This limitation stops for citizens of European Economic Area and EU Member States on the day of accession of the Republic of Croatia, when these citizens will be able, under same conditions as Croatian citizens, to offer these rent service.

Therefore, foreign physical persons cannot rent the apartments in their own houses in Croatia, but they can register a craft or they can found a company in Croatia that will do the renting for them.

However, there are certain conditions that need to be fulfilled:

1. A craft or a company need to be found/registered, and the apartments for rent need to be situated in houses owned by that company/craft.
2. The decision needs to be acquired from The Office of the State Administration in the County competent for Tourism (Office for tourism)
3. Work permit or business permit need to be acquired. They are issued with a validity period equal to the one of the decision from the office for tourism.
4. Temporary work residence permit needs to be acquired.

Most important of these 4 conditions is the decision of the office for tourism. The office shall issue requested decision only if the craft/company:

- is registered and authorized to perform rent services

- has the usage rights over the object

- the object fulfills the conditions prescribed for the apartment category.

            When a company is found or a craft is registered, activities which that company/craft is authorized to perform are also registered in the court register.

            Object usage right are demonstrated by a title deed and as well with building and usage permit. It is important to note that in these permits there must be a note that this object is in business or mixed (housing-business) zone. Otherwise, if the apartment is in housing zone, a craftsman of a company cannot perform rent services in those apartments.

The competent office for tourism determines, on ones request, if minimal conditions for this art and object category are satisfied. 

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