What is a parcelization agreement?
Are you planning to build and thinking about entering into a subdivision agreement? Before you start negotiating an agreement, read below to find out what a subdivision agreement actually is, its advantages and disadvantages, and when it is or is not mandatory.
This article was written in 2020. If you are looking for up-to-date information on this topic, please do not hesitate to contact us at office@arws.cz or by phone on +420 245 007 740. We will be happy to advise you.
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Author of the article: ARROWS (JUDr. Ondřej Stehlík, LL.M., MBA, Mgr. Alice Dajčarová, LL.M., MSc., office@arws.cz, +420 245 007 740)
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A subdivision agreement is a contract concluded by the applicant for a regulatory plan or a party to a zoning proceeding with the owners of land and buildings that will be affected by a particular development plan. The subject matter of the agreement is, in particular, the consent of these affected owners to the proposed construction project, agreement on the layout of the parcels, the arrangement of public infrastructure and agreement on the distribution of costs and, if applicable, revenues associated with the implementation of the project.
The purpose of the parceling agreement is therefore to resolve the ownership relations in the area concerned, including the extent to which and in what way the individual owners will contribute to the creation of the infrastructure. However, a parcelling agreement cannot be concluded and used for the purposes of planning proceedings or the issue of a regulatory plan unless even a single affected land or building owner agrees to it.
1. The parceling agreement as a condition for the issuance of a zoning permit
Under the current statutory regulation, it is necessary to distinguish two situations where the law provides for the conclusion of a parceling agreement. The first is the conclusion of a parceling agreement in the context of a zoning procedure, where the conclusion and documentation of a parceling agreement is a necessary condition for the decision in the zoning procedure. According to Section 43(2) of Act No. 183/2006 Coll., the Act on Spatial Planning and Building Code, as amended (hereinafter referred to as "StZ"), the condition to conclude a parcel agreement may be set by the zoning plan, which defines areas or corridors in which decisions on changes in the territory may be made only on condition of a concluded parcel agreement. In the event that the condition of concluding a parcel agreement cannot be met, the only way to resolve such a situation would be to initiate an amendment to the zoning plan.
The statutory regulation does not provide for any time limit for the conclusion of a parcelisation agreement for the simple reason that in cases where the zoning decision is conditional on the conclusion and submission of a parcelisation agreement, and no zoning decision can be issued without the submission of a concluded agreement, it is in the interest and competence of the person wishing to implement his/her construction project to have the agreement concluded.
2. Agreement on parceling in the context of the regulatory plan at the request of
The second situation is the conclusion of a parceling agreement in the context of the acquisition of a regulatory plan upon request. Section 66(2) of the StZ provides that the applicant for a regulatory plan may conclude a parceling agreement. This is followed by Section 66(3)(e) of the StZ, which also lists a parceling agreement as one of the possible required annexes to the application for a regulatory plan. The parceling agreement serves to verify that the relations to land to which the applicant for the regulatory plan does not have the necessary right (e.g. he is not the owner, does not have a building right, etc.) are also regulated. In this case, the agreement on parcelling is only one of several possibilities provided by law to prove the regulation of the relations to the land and buildings concerned. Therefore, if the applicant has another statutory document regulating these relations, there is no obligation to conclude a parceling agreement.
Conclusion
A parceling agreement is therefore an institution which requires the cooperation of a large number of persons. This in itself can be problematic, as the disagreement of a single person can make your progress as a builder almost impossible. In such a case, you would have no choice but to initiate an amendment to the zoning plan, which will, however, make the whole process considerably longer and often considerably more expensive. At the same time, it should be emphasised that if you are considering implementing a building project, it is more than advisable to check first of all whether or not the conclusion of a parcel agreement by the zoning plan is a condition for deciding on zoning changes.