On 17 September 2016 the Act of 25 June 2015 amending the Act on Real Property Management and the Family and Guardianship Code (Dz.U. of 2016, item 1271) will come into effect. The Act introduces into the Act on Real Property Management a new provision, namely Article 111a, which grants to the State Treasury and to the capital city of Warsaw a pre-emptive right in a situation where the rights and claims stipulated, amongst others, in the Decree of 26 October 1945 on Ownership and Usufruct of Land within the Capital City of Warsaw (Dz. U. No. 50, item 279, and of 1985 No. 22, item 99), as well as claims for compensation for real property taken over by the State under the adduced Decree are to be sold.
As regards the amendment under discussion, doubts have emerged whether it would sufficiently protect the public interest and prevent malpractices in trading in reprivatization claims. Some experts claim in particular that the pre-emptive right only seemingly serves the purpose of eliminating malpractices, and is easy to circumvent. That would mean that the legislator prepared the amendment incautiously.
Such accusations are not justified. When amending the Act on Real Property Management, the legislator decided, in a well-thought-out manner, to introduce the institution of pre-emptive right, thus limiting the possibility to dispose of claims only in a situation where the claims are being sold.
The most ill-judged claims of the critics of the reform are those related to the “omission” of the exchange and gift agreements in the new regulation on the pre-emptive right. It needs to be stated that the term “pre-emptive right” has been used also in other places in the Act on Real Property Management (see Article 109 of the Act), where it also pertains only to sale agreements. That is because in terms of structure the pre-emptive right may apply only to that type of legal transaction (Article 596 of the Civil Code).
The claims that the regulations can be easily circumvented by means of executing exchange or donation agreements are not supported by facts, either. The provisions concerning sale agreements (Article 604 of the Civil Code) apply to exchange agreements, respectively, and therefore the pre-emptive right applies also to that type of legal transactions, which will be subject to the new regulations. Therefore, it will be impossible to circumvent the pre-emptive right regulations by means of executing an exchange agreement.
The accusation that execution of a donation agreement could be used as means of circumventing the pre-emptive right regulations is also incorrect. It must be stated firmly that the pre-emptive right constitutes a limitation of trading, whereas donation agreements do not pertain to trading at all, as such agreements stipulate solely provision of gratuitous benefits at the cost of the property of one of the parties, and do not stipulate any exchange of equivalent benefits. Thus, the pre-emptive right cannot limit the entities providing gratuitous benefits to other persons or entities. In addition, even if donation agreements were executed by those trading in claims, such agreements would be just textbook examples of ostensibility and could be questioned before a court in each case, also on initiative of the pre-emptive right holders.
Finally, attention needs to be paid to the wording of Article 111a (2), which requires each transfer of reprivatization claims to be made in the form of a notarized deed, or else such a transfer shall be null and void. So, in each case the lawfulness of the transaction is controlled by a notary public. A notary public is also obliged to refuse performance of an illegal transaction (Article 81 of the Notary Public Law). In addition, a notary public is obliged to make sure that the rights and legitimate interests of the parties, and of other persons or entities for whom a notarial action could have legal consequences, are suitably protected (Article 80 paragraph 2 of the Notary Public Law). Thus the mere introduction of a requirement to perform all transactions related to the trading in reprivatization claims before a notary public is a sufficient protection against malpractices concerning that matter, while remaining compliant with the constitutional rule of proportionality of limitation upon the exercise of rights (Article 31 para. 3 of the Constitution of the Republic of Poland).
To sum up, it needs to be said that the legislator correctly used the notion of pre-emptive right when amending the Act on Real Property Management. The adopted regulation is compliant with the essence of the pre-emptive right stipulated in the Civil Code, and the adduced potential methods of circumventing the new law cannot be deemed plausible in the light of the rules of correct interpretation of legal norms.
