Sat11172018

Last update12:12:22 PM

Back You are here: Home Legal and Finance Finance Off Plan Building Act Regulations

Off Plan Building Act Regulations

With off-plan purchases of properties in Bulgaria the practice is that the preliminary contract is signed when the property is still in the process of construction, or even at plan stage. At this stage the first instalment, or deposit, is paid.

In this preliminary contract the obligation of the buyer to pay each instalment should be related to the obligation of the developer to obtain the respective building Acts and permissions throughout the building process.



These Acts, or permissions, are:



•Act 14 (Act for acceptance of the building) –this Act means that the roof level of the building is completed. Usually the developers with a good reputation require the second instalment under the contract to be paid after Act 14 is issued.

•Act 15 (Act certifying the suitability for acceptance of the construction) – with this Act the developer proves before the authorities that the building is constructed in accordance with the approved architectural project. In relation to the above example, the third instalment is due after Act 15 is obtained.

•Habitation certificate (Act 16). This is the final Act of the building process. For obtaining the habitation certificate it is necessary for a written request to be sent to the State Agency for Building Control with the report from the consultant together with all the documents required during the building process.

Following that the head of the State Agency for Building Control appoints the commission which accept the building works and form the official statement about the building works and issue Act 16, together with a proposal for issuing the Building Certificate if the building is in accordance to all projects, documents and the legislation.

According to Bulgarian Construction Law the buildings or parts of the buildings which are not entered into exploitation are unusable.In general terms, Habitation certificate certifies that the building is suitable for usage and appropriate for living.

 

Include a clause about Act 16 in your preliminary contract.

So, if the last instalment is paid and the Notary deed is signed before Act 16 is obtained by the seller, it is strongly recommended that a clause is included in the preliminary contract that the seller is obliged to provide the buyer with Act 16 within a specified period after signing the Notary deed even though the buyer is already the new owner of the property.

This is because the preliminary contract is a fully legally binding contract in the part of finishing of the building process even after the Notary deed is signed.



The preliminary contract is enforceable under Article 19 of the Bulgarian Law of Contracts and Obligations and, should one of the parties decide not to go ahead with its obligations, the other party can apply before the court for enforcing the contract in accordance with the above Article and to complete the purchase through court decision.

 

This article is by NYD Law, law firm, bulgaria

Website : nyd-law.com
Email : This email address is being protected from spambots. You need JavaScript enabled to view it.
Email : This email address is being protected from spambots. You need JavaScript enabled to view it.