The New Construction Code. Impact in Terms of Required Construction Documentation
Adresa
Strada Gheorghe Polizu, Nr. 58-60
Cladirea Bucharest Corporate Center, Etaj 13
011062 Bucureşti, Sector 1
Telefon
+40-21-308.81.00
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+40-21-308.81.25
Website
www.wolftheiss.com
IULIA SIMION
Attorney-at-law
SOCIETATEA CIVILĂ DE AVOCAŢI "WOLF THEISS ŞI ASOCIAŢII"
RADU SIMION
Attorney-at-law
SOCIETATEA CIVILĂ DE AVOCAŢI "WOLF THEISS ŞI ASOCIAŢII"
The construction field has enjoyed spectacular growth in Romania over the last several years. Such development of the real estate market has required that adequate legislation be developed in order to support and properly address all issues that may arise in connection therewith. Although Romania has already adopted a number of laws and regulations in this respect, it is anticipated that a unitary legal framework will be enacted. The first project that aimed to achieve this goal was launched in the fall of 2006 under the name of the Construction Code and was put out for public debate.
This first draft Construction Code intended to integrate all existing enactments that relate to the construction field into one unitary legislative framework and, thus to eliminate any inconsistencies between different regulations, to fill in legislative gaps and to remove ambiguous and conflicting interpretations in the existing laws. As might be expected, the Construction Code also sought to harmonize the relevant Romanian laws in the construction area with the principles adopted at the level of the European Union.
Unfortunately, the first draft submitted for public debate, back in 2006, failed to receive the expected support. Shortly after it was published, strong criticism1 was raised by the practitioners in the field. This negative feedback caused the State Construction Inspectorate to abandon its first attempt and try again.
Accordingly, a new draft of the Construction Code (the “New Construction Code”) was adopted. The New Construction Code is structured into two main chapters: (i) the code regarding the organization of the territory and urbanism and (ii) the construction code.
We will briefly analyze below the core principles that apply to the planning system in Romania, which are intended to be restated or clarified in the New Construction Code. Insufficient understanding of these principles, in the past, often resulted in gross errors being committed in the authorization and/or construction process. There is a risk that these errors may subsequently result in difficulties arising when investors seek to sell their real estate projects.
Planning system
Romanian real estate is essentially organized through a multi-tiered planning system, structured as follows:
- the General Urban Plan (Romanian: “Planul Urbanistic General – PUG”);
- the Zoning Urban Plan (Romanian: “Planul Urbanistic Zonal – PUZ”); and
- the Detailed Urban Plan (Romanian: “Planul Urbanistic de Detaliu – PUD”).
The PUG is the most extensive urban plan and provides for short-term, as well as medium and long-term, planning specifications pertaining to the level of a basic administrative unit (i.e., a municipality, a city or a commune). Each such administrative unit must have a PUG. Once properly drafted, endorsed and approved, it establishes the fundamental legal basis for any project developments or real estate investments within the covered administrative unit.
The PUZ is a more detailed plan and relates to the development of a particular area located within the territory of an administrative unit. The PUZ provides detailed regulations for the particular subject zone.
The PUD is intended to provide more specific details and clarifications in relation to the requirements and regulations set forth in the PUG and the PUZ and to establish the construction specifications. It generally refers to: (i) the accessibility and connectivity to the utility networks; (ii) the permitted constructed volumes; and (iii) functional and aesthetical integration with the neighboring properties.
Each administrative unit should have a PUG. As a rule, the PUZ and PUD must observe the parameters set out in the PUG. The PUG may be amended by means of a PUZ or PUD only when specifically provided for in the law.
If an investor intends to develop a project which requires amendment of the PUG, then either a PUZ or a PUD (depending on the specific parameters which must be amended), must be prepared and properly endorsed and approved by the competent authorities. The need for a PUD or PUZ should be set out in the planning certificate. This planning certificate (as clarified in more detail below) is issued at the outset of the approval process, in order to provide the developer with a preliminary official opinion on the urban suitability of a contemplated development project and the corresponding urban requirements with which the project must comply. Once approved, the respective PUZ or PUD becomes enforceable and effective.
