Forcible expropriation of private property for public needs
Forcible expropriation of private property for public needs1
Dimitar Kaldamukov, Attorney at law at Tocheva and Mandazhieva Law office
This can only be done on the basis of the law, provided that these needs cannot be satisfied by other
means. Often when the State and the municipalities build sites with national significance it is inevitable
to affect private real property. Generally speaking, private property is according to the Constitution
inviolable and a basic principle is that the forcible expropriation of property for state and municipal
needs can occur only on the basis of a law, under the condition that those needs cannot be otherwise
met and after a preliminary and equivalent compensation. The principle of the Constitution is
developed in the Municipal property act (MPA), in the State property act (SPA), and the Rules for its
application (RASPA). Paragraph 1 of the additional provisions of SPA gives a definition for a national
entity.
An equivalent monetary compensation
The equivalent monetary compensation shall be determined in accordance with the intended use of
the property before the Detailed development plan (DDP) comes into force, respectively, before the
approval of the DDP, which envisages a construction of a national object and for which a final that has
come into force order is present which concerns the admission of preliminarily fulfillment, based on the
market prices of properties with similar characteristics, located near the expropriated one.
In the event that the property is included in the scope of an urbanized territory, however, that has been
non-regulated before the coming into force of the DDP, respectively, before the approval of the DDP,
which envisages building a national entity, the market price is determined the same way it is for a
property without preliminary construction and complies with the established lasting manner of actual
use of the property.
In case the market prices of properties with similar characteristics cannot be determined due to lack of
performed transactions in the respective registry office, the equivalent monetary compensation is
determined in the following order:
■ RASPA - for properties in the urbanized territories and planned zones.
■ The Ordinance for the procedures for the determination of prices of agricultural lands – for
agricultural lands.
■ The Ordinance for the evaluation of the plots in forest territories – for the forest territories.
Can the compensation be successfully appealed against?
The expropriation decision of the Council of Ministers (CM) can be appealed against before the
Supreme Administrative Court (SAC) within 14 days from its publication in the National gazette (NG).
When appealing only against the amount of the compensation, the appeal does not discontinue the
execution of the decision. Most often the owner appeals against the size of the compensation.
1
The article is available in Bulgarian language here http://www.capital.bg/biznes/vunshni_analizi/2013/04/14/2041431_prinuditelno_otchujdavane_na_chastni_imoti_z
a_durjavni/
Tocheva and Mandazhieva Law Office, 26, Stoyan Mihaylovski Str., fl. 5
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Forcible expropriation of private property for public needs
According to the case law, when the assessment is not made in accordance with the criteria laid down
in the respective normative act, the Court increases the compensation. The court appoints forensic
technical expertise and enacts mostly in accordance with the opinion of the experts. Therefore, during
its ruling the Court aims to achieve a compensation which is not aimed at enriching the parties, and to
fulfill the criteria set forth by the legislator.
Compensation with property instead of money
When you alienate farmlands and forest territories, as an equivalent compensation can also be
provided a property - private state property from the State land fund and from the forest territories state property. Such compensation is not allowed, however, when it comes to dimensions smaller than
3 decares of cornfields, 2 decares of meadow, 1 decare for perennial crops and 1 decare for forest.
For the compensation to happen, there must be free farm lands and forest territories which to happen
with.
When appealing of expropriation about the equivalent amount of the compensation the Court awards
the difference in monetary terms when the value of the provided property is lower than the value of the
expropriated.
Common procedure for expropriation according to SPA
The expropriation is carried out with a decision of the Council of Ministers (CM) by the proposal of the
Minister of the regional development and the Minister of finance. The mayor of the respective
municipality is obliged to immediately present a notice for the commencing expropriation procedure in
a conspicuous place in the building of the municipality.
In the decision of CM for expropriation are indicated the state needs for which the properties, the type,
the location, the size, the price (amount of compensation) and the owners of any of the properties that
are being expropriated. The decision is published in the National gazette.
Legally built constructions and other improvements made by the owner of the property after the DDP
has come into force under the conditions and by the procedure of art. 49 of the Spatial planning act
(temporary constructions), are paid in the lesser value between the value of the costs incurred and the
increased value of the property.
Legally built constructions and other improvements made by the owner of the property after the
publication of the Expropriation decision in the National gazette when the grounds for the forced
expropriation is the approved DDP which stipulates a construction of a national object and for which it
is present the entered into force order for admission of preliminary fulfillment are paid in the lesser
value between the costs incurred and the increase d value of the property.
The property is considered expropriated from the date on which the monetary compensation, defined
in the decision of the Council of Ministers, is transferred to the account of the entitled/rightful
claimants. When the decision of the Council of Ministers is appealed against on the account of either
the size of the amount of the compensation or their preliminary fulfillment is granted, and it is not
annulled by the Court, the property is considered to be appropriated from the date on which the
investor has transferred to the account of the District Governor (if there is a dispute between a few
persons for the right on the amount owed) the compensation, defined in the decision of the CM. If
within a 6-month time period from the coming into force of the decision of the Council of Ministers or of
the judicial decision the owner is not compensated, then at his request, the Administrative Court with
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Forcible expropriation of private property for public needs
respect to the property location, respectively SAC, repeals the expropriation act. The compensation,
defined in the decision of the CM or in the court order, shall be submitted by the investor of the object
in a commercial bank to the account of the entitled/rightful claimants.
The investor of the facility publishes a notice in two central and one local daily newspapers, thus
notifying the owners of the properties of the commercial bank the compensation is transferred to and
of the starting date, from which the payment starts. When the decision of the CM is appealed against
in terms of the size of the compensation, and the Court has ruled a higher amount, the investor pays
to the entitled the difference together with legitimate interest of the compensation within a one-month
time period of the court decision entered into force. If within a 5-year time period from the expropriation
of the property the DDP measure has not started or the property is not used for its expropriation
purpose, then at the request of the former owner of the property the governor sends the request to the
Minister of the regional development, who proposes to CM a complete or partial nullification of the
expropriation decision. If the approved DDP is nulled by the Court, and the new DDP entered into
force does not affect the already expropriated plots, the former owner of the property can file a request
to the District Governor for a nullification of the expropriation. The district governor sends the request
to the Minister of the regional development, who offers the CM a complete or partial expropriation
decision nullification. In these cases the state owes a compensation to the owner for incurred
damages.
The article does not constitute a legal opinion or advice related to concrete situation or entity. Due to
its limited scope the same does not seek to be theme exhaustive. For more information on the touched
upon questions you can contact the author via the following e-mail: kaldamukov@tmlawoffice.bg
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