Sacrificial lambs: Are EU threats of action too late for land grab victims?

4th May 2005, Comments 0 comments

Spain's notorious 'land grab' law may be under threat from the EC but is this all too late? And what could happen to the property-dependent local economy if the law is repealed?

It began, allegedly, as a laudable plan to promote low-cost housing for local workers, but it evolved into what has been described as the greatest violation of property rights since the fall of communism.

Svoboda leads fight against land grab law

It threatens to ruin a great many people – and to significantly enrich a small minority of developers.

It is the Urban Development Activity Act, the LRAU — better known as the land-grab law, first introduced in Valencia, eastern Spain, in 1994.

The law allows land to be confiscated in order to 'urbanize' rural areas by adding infrastructure like roads, lighting, water pipes and sewerage.

Threats have, on occasions, accompanied orders to hand over land, whose status is changed by town halls which lift building restrictions by reclassifying rural land as urban.
Ironically, the law was passed to crack down on speculators who were holding on to pieces of undeveloped land in the hope that they would sell on later at a higher price.

However, critics claim, developers will often buy cheap, undeveloped rural land that gives them more than 50 percent ownership of a sector designated for urbanization, the remainder of which comprises other people's homes.

They then submit an infrastructure plan to the council that receives quick approval because they can accurately tell the town hall that there is majority consent for the project — the majority being the developer and few, if any, other owners.

Recent developments offer a glimmer of hope for those threatened with the summary confiscation of their land, and the enforced sequestration of their financial assets — or do they?

The European Commission has ruled that the Spanish government is violating EU laws on property ownership and human rights; it threatens heavy sanctions and the withdrawal of EU subsidies if the law is not repealed.

It has given the Valencian regional authorities one month to take action.

Charles Svoboda, a retired Canadian diplomat, president of the Abusos Urbanisticos No (No to Urban Abuses) association, which has campaigned against the law since 2002, remains cautious.

"I suspect that they'll simply keep stalling until a new law is ready to be put in place,” he told us, "and then keep on doing much the same thing.

"And anyway, the repeal of the law would affect only future developments, not those already approved."

Expats face loss of dream Spain homes because of land grab law

Svoboda's home in Benissa, near Valencia, now faces a possible new boundary line straight through his swimming pool, and he is pinning his hopes on aspects of the threatened EU sanctions.

"Individual mayors of towns involved may now face personal legal action," he says, "and that may be enough to make them start listening. They could face ruin themselves, if the European human rights court rule against them."

Janice and Graham Fisher are classic victims of the land-grab law.

They bought their home in Tibi, Alicante, in 1996, spent all their time and money improving it, and now face total ruin, as 31 houses are to be constructed on a plot currently holding seven.

All of these may be bulldozed, and the Fishers may well have to pay for the work.

"The town hall have two choices," Fisher told us, "Ruin us, or be ruined themselves by the developers. We’re just sacrificial lambs, and even if Brussels gets the law changed, it won’t help those of us already affected."

Even where owners are not faced with ruin, they may still face major costs, as councils enforce the law to improve their facilities.

Roger Ranger of Pinamar, near Javea, faces compulsory 'updating' of his street, plus five others, to include sewers, street lighting, and new roads — in order to complete the infrastructure for a huge new urbanisation behind them.

"We all have septic tanks and house lighting," Ranger told us, "and we don’t need the new roads, but it will cost at least EUR 16,000 per house, just for the small, legal plots."

"Others face charges of up to EUR 36,000 — if we needed it done, we could get it done for a fraction of the costs the council are quoting, which many residents simply can't afford.

"Not that that will help; if you’re told to pay, you pay — or face an embargo on your property."
Campaigners say what the EU Commission should enforce, at least, is a breathing space, for the affected property owners to regroup and continue their fight.

Meanwhile, Rafael Blasco, the Valencian minister for housing and development, has dismissed the EC report, raising suspicions that it will simply be ignored.

But if Brussels decides to get tough—and that's a big 'if'—both Spain and the Valencian community could suffer partial, or even total withdrawal of EU subsidies, leaving a gaping hole in their budget.

Perhaps what might persuade individual mayors and councillors to act is the threat of prosecution, civil or criminal.

But will any of it really stop this? After all, this law is in violation of the Spanish constitution, several Spanish laws, the European constitution (now approved by referendum and formally ratified by Madrid), and the EU property rights laws — and yet it was legally passed, and continues to be implemented.

Retrospective repeal of the law may save many expatriates, and Spanish nationals, from ruin, but it may expose many councils to punitive costs, and thwart the plans of many major developers.

The mayors of the towns involved — not one of whom would speak to Expatica — claim that they have to enforce the law or face punitive damages claims by the developers.

The developers claim that their plans for building were all legal, and must be respected.

Millions upon millions of euros are involved, and the towns thus expanded will reap the benefits of massively increased revenue from local taxes. Or will they?

The figures are, frankly, frightening. Currently up to 500,000 homes lie empty in the Valencia region and another 250,000 new ones are scheduled to be built over the next five years.

Scores of Spanish towns are involved, and many thousands of expatriates threatened.

Word-of-mouth evidence suggests that many Scandinavians and Germans are coming off local council registration lists in droves — one has to assume they are returning home.

One also has to assume that building continues because construction is all there is; what happens when the bubble bursts? What happens to the banks, when they face massive defaults by failed developers? 

If the property market faced catastrophic meltdown what would happen to the Valencia region then?

It is has been said that money talks and, in this instance, money may be talking far louder than the voices of those retired expatriates who are facing total ruin, or even the voices of sanity that question this enormous building programme — for which no market may exist.

For those affected

Abusos Urbanisticos-No (No Urban Abuses)

The group has been campaigning against the so-called 'land-grab' law. The group, whose president is Charles Svoboda, is made up of both expats and Spaniards. See

[Copyright Expatica May 2005]

Subject: Spain; land grab law

0 Comments To This Article