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Skip Navigation LinksBulgaria At a Glance > Legal Framework > Commercial Law Overview > Real Estate Investment > Stages of development of real estate projects 18.05.2012  
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Stages of Development of Real Estate Projects

The text below is kindly provided by Wolf Theiss  

According to Bulgarian Spati al Development Act (Закон за устройство на територията) , the construction process progresses in the following major stages: (i) approval of the investment design, (ii) issuance of the construction permit, (iii) and issuance of the operational permit. Construction is generally allowed in urban areas in accordance with the specific designation. Construction permit is a mandatory condition for commencing of construction works.

Investment project

The investment projects may be commissioned and prepared in the following design phases:

  • preliminary project;
  • technical project;
  • working project (working drawings and details).

The investment project is approved by the chief municipality architect, provided that the project contains or complies with: the detailed zoning plan; zoning norms; specific requirements in respect of urban sites such as functionality; transport accessibility; environmental permissions; and consistency between the individual parts of the project.

Permits with respect to the construction:

Construction Permit

Construction is subject to a construction permit issued by the chief municipality architect, district governor, or the Minister of Regional Development and Public Works (the "Construction permit"), depending on the territorial scope of the construction and complexity of the project.

The Construction permit is issued on the basis of (i) a detailed zoning plan which is entered into force, (ii) a ‘Visa’ or drawing of the plot, and (iii) an approved technical or working project or a preliminary project.

Persons who may apply for a Construction permit are: (i) the owner of the land, (ii) a person or legal entity who has a right in rem to build on land owned by another person, (iii) or a person or legal entity who has a right to build on land owned by another person by virtue of a special law. New construction work on a jointly owned regulated plot may be performed by one or several joint owners on the basis of a notary deed executed with the rest of the joint owners.

Announcements

A Construction permit is subject to announcement to the interested parties (the investor, the owner of the land, the persons having limited rights over the land, and the person entitled to perform construction on another person’s property by virtue of special laws) and is subject to appeal within 14 days of announcement.  The Construction permit that has entered into force cannot be repealed.

The Construction permit expires if construction works have not commenced within 3 years or if the rough construction has not been completed within 5 years of its issuance. It is possible to extend and revalidate these terms.

Other permit and approval with respect to the construction

Environmental impact assessment ("EIA")

According to the Bulgarian Environment Protection Act (Закон за опазване на околната среда)  a prior decision on the EIA, and approval is required for certain investment projects.

A decision on EIA is issued by the Minister of Environment and Waters (MEW). The procedure for obtaining a decision on the EIA takes around 6 months.

Complex Permit

The construction and the exploitation of new operating installations and facilities are subject to prior approval by means of issuing of a complex permit (the "Complex permit") according to the Environment Protection Act. The competent authority here is the Executive Agency for Environment ("EAE"). The Complex permit is a condition precedent for obtaining a construction permit and takes around 5 months.

The Complex permit allows the permit holder also to operate waste management and water supply and disposal of wastewater. No additional permits are required for such activities.

Operational Permit

Following actual construction, a development is required to obtain an operational permit issued by the Director of the National Construction Supervision Directorate (the "Operational permit").

The application for issuance of an Operational permit contains: a final report by the person assigned with the independent construction supervision; the construction permit; a protocol for determination of line and level of construction; Act № 15 for the establishment of the serviceability of construction, a certificate issued by the Cadastre Agency certifying the fact of the duly submission of the executive construction papers ; certified book for orders for the construction; documents certifying the investor’s ownership/right of construction over the land; contracts with utility companies (e.g., electricity and water supply).

The time limit for the authority to issue an Operational permit is approximately five weeks.
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