Rules on the acquisition of real estate by foreigners

In accordance with Article 1(2) of the Act, a foreign national is:

• a natural person who does not hold Polish citizenship;
• a legal person having its registered office abroad;
• a partnership of the persons referred to in points 1 or 2, without legal personality, having its registered office abroad, established in accordance with the legislation of foreign states;
• a legal person and a commercial partnership without legal personality having its registered office within the territory of the Republic of Poland, controlled directly or indirectly by the persons or partnerships referred to in points 1, 2 and 3.

In accordance with Article 1(4) of the Act, the acquisition of real estate within the meaning of the Act shall be understood as the acquisition of ownership of real estate or the right of perpetual usufruct, on the basis of any legal event.

The Act, which regulates the purchase of real estate by foreigners, introduces, as a general rule, the requirement to obtain a permit for the acquisition of real estate by a foreigner.

Pursuant to Article 1(1) of the Act, the acquisition of real estate by a foreigner requires a permit. The permit is issued, by way of an administrative decision, by the minister responsible for internal affairs, provided that no objection is raised by the Minister of National Defence, and in the case of agricultural real estate, provided that no objection is raised by the minister responsible for rural development.

The acquisition of real estate by foreigners without obtaining a permit is invalid. The permit must be issued prior to the date of acquisition of the property; it is not possible to issue a permit retrospectively (see: Judgment of the Supreme Administrative Court of 18 October 2019, ref. no. II OSK 2839/17, LEX no. 2761897).

Furthermore, a permit to acquire real estate is issued upon application by a foreign national if:

• the acquisition of the property by the foreign national does not pose a threat to national defence, state security or public order, nor is it contrary to considerations of social policy and public health;
• he or she demonstrates that there are circumstances confirming his or her ties with the Republic of Poland.

Circumstances confirming a foreigner’s ties to the Republic of Poland may include, in particular:

• holding Polish nationality or being of Polish origin;
• marriage to a citizen of the Republic of Poland;
• holding a temporary residence permit, excluding the permit referred to in Article 176 and Article 181(1) of the Act of 12 December 2013 on Foreigners, or
• permanent, or
• long-term resident of the European Union;
• membership of the management body of the undertakings listed in Article 1(2)(4);
• the pursuit of economic or agricultural activity within the territory of the Republic of Poland, in accordance with the provisions of Polish law.

The Act also provides for several cases where the acquisition of real estate by a foreigner does not require the relevant permit. Pursuant to Article 8(1) of the Act, subject to paragraph 3, no permit is required for:

• the acquisition of a self-contained residential property within the meaning of the Act of 24 June 1994 on the Ownership of Premises;

1a) the acquisition of a separate commercial premises intended for use as a garage or a share in such premises, provided that this is related to meeting the housing needs of the purchaser or the owner of the property or of the separate residential premises;

• the acquisition of real estate by a foreign national who has been residing in the Republic of Poland for at least 5 years from the date of being granted a permanent residence permit or a long-term resident’s permit of the European Union;
• the acquisition by a foreigner who is the spouse of a Polish citizen and has been residing in the Republic of Poland for at least 2 years from the date of being granted a permanent residence permit or a long-term resident’s permit of the European Union, of real estate which, as a result of the acquisition, will constitute the statutory joint property of the spouses;
• the acquisition of real estate by a foreign national, provided that on the date of acquisition they are entitled to statutory inheritance under Polish law from the vendor of the property, and the vendor has been the owner or holder of a perpetual usufruct of the property for at least 5 years;
• the acquisition by an entity referred to in Article 1(2)(4), for its statutory purposes, of undeveloped real estate whose total area nationwide does not exceed 0.4 hectares within urban areas;
• the acquisition of real estate by a foreigner who is a bank and, at the same time, a mortgagee, by way of taking ownership of the real estate following an unsuccessful auction in enforcement proceedings;
• the acquisition or subscription by a bank, being a legal person as defined in Article 1(2)(4), of shares in a company referred to in Article 3e, in connection with the bank’s pursuit of claims arising from banking transactions carried out.

Importantly, pursuant to Article 8(2) of the Act, no authorisation is required for foreigners who are citizens or entrepreneurs of states party to the Agreement on the European Economic Area or the Swiss Conference, with the exception of the acquisition of:

• agricultural and forestry property, for a period of 12 years from the date of the Republic of Poland’s accession to the European Union;
• a second home, for a period of 5 years from the date of the Republic of Poland’s accession to the European Union.

It follows from the above that the 12-year transitional period concerning the acquisition of agricultural and forestry property by foreign nationals expired on 1 May 2016. Consequently, the restrictions on the acquisition of property in Poland arising from the Act no longer apply to foreigners who are citizens or entrepreneurs of Member States of the European Economic Area or the Swiss Confederation. Consequently, the acquisition of agricultural property by foreigners from the European Economic Area or the Swiss Confederation does not require the authorisation of the minister responsible for internal affairs.

Summary

In summary, the Act introduces a number of restrictions and conditions limiting the acquisition of real estate by foreigners on the basis of each legal transaction. The Act primarily serves a protective function, safeguarding the interests of the state. The main purpose of the restrictions is to protect Polish real estate from large-scale acquisition by foreigners.

Author

Adrian Łukasik

Radca prawny, Senior Associate

He gained his professional experience in one of Lublin's renowned law firms, dealing with civil and business law in its broadest sense. At the law firm Hewelt Wojnowski i Wspólnicy spółka komandytowa, he deals on a daily basis with current counseling in the field of business and the development of corporate documentation of companies, such as. Company agreements, bylaws of company bodies, agreements regulating relations between shareholders, resolutions of company bodies, M&A transactions. In addition to…

View profile →