{"id":5766,"date":"2024-09-26T15:14:00","date_gmt":"2024-09-26T13:14:00","guid":{"rendered":"https:\/\/m2apartners.cz\/planning-contracts-under-the-new-building-act\/"},"modified":"2025-03-27T17:03:27","modified_gmt":"2025-03-27T16:03:27","slug":"planning-contracts-under-the-new-building-act","status":"publish","type":"post","link":"https:\/\/m2apartners.cz\/en\/planning-contracts-under-the-new-building-act\/","title":{"rendered":"Planning contracts under the new Building Act"},"content":{"rendered":"\n<p>Planning contracts <strong>concluded under the original Building Act<\/strong> are innominate contracts, we have discussed them in more detail in a previous article (link here). <strong>With the effectiveness of the new Building Act, planning contracts change their nature and acquire a public law character<\/strong>. The change in the nature of planning contracts will have to be reflected in the model of the contracts themselves and also in the adopted principles of cooperation with investors. The nature of the private law contracts concluded under the original Building Act will remain unaffected and<strong> the contracts will remain valid<\/strong>. However, the nature of the contracts may be modified by an amendment in accordance with the new Construction Act.   <\/p>\n\n<p>According to the new Building Act, a planning contract is a public law contract between a builder on the one hand and a municipality, a district of the capital city of Prague, a region or an owner of public infrastructure on the other hand. According to the explanatory memorandum, the range of contracting parties is not definitive, as another entity (e.g. a participant in the construction project permit procedure) may also become a contracting party. <\/p>\n\n<p><strong>The content of the contract is the determination of the mutual obligations of the parties to provide each other with cooperation in the implementation of the intention stated in the contract and to proceed with its implementation in the agreed manner<\/strong>. The contract may also include the regulation of the rights and obligations of persons in the field of private law (e.g. to participate in the construction and financing of public infrastructure). <\/p>\n\n<p>With the consent <strong>of all parties <\/strong>, the planning agreement can be assigned, which gives the developers the option to opt out of the project and, for example, sell the project, even together with the assignment of the agreement, if the other parties agree or if this consent is included in the agreement. <\/p>\n\n<p>In principle, several types of contracts can be distinguished. The first type is the <strong>planning agreement defining rights and obligations <\/strong>in the permitting procedure, which serves to coordinate the developer&#8217;s intention with the public interests of the municipality, the county or the owner of public infrastructure in the permitting procedure for the construction project. However, it may be recommended that this interaction be specifically defined in the agreement.  <\/p>\n\n<p>The second type is a <strong>planning agreement in a land use planning matter<\/strong>. Such a planning agreement allows a municipality or county to commit to issue planning documentation or to not issue or amend planning documentation or take any other action that would make it difficult or impossible to carry out the project for an agreed period of time. At the same time, it allows the developer to be obliged to provide monetary or in-kind consideration for the appreciation of the land on the basis of the issuance of a zoning plan, while the purpose of the consideration provided may also be determined. Such an agreement obligates the municipality to proceed with the site plan process to allow for the construction of a proposed development that cannot be permitted under an effective site plan.   <\/p>\n\n<p>The third type is <strong>conditional planning agreements<\/strong>. According to the new Building Act, it is possible to define in the zoning plan an area in which decision-making in the territory is conditional on the conclusion of a planning agreement. In such a case, the zoning plan shall determine the content of the planning agreement, the conditions and the time limit for its conclusion, which shall not be longer than 6 years from the entry into force of the zoning plan. If the agreement is not concluded within these 6 years, the builder is no longer obliged to conclude it.   <\/p>\n\n<p>Outside of conditional planning agreements, entering into a planning agreement is <strong>voluntary, not mandatory<\/strong>. However, it can be concluded that <span style=\"text-decoration: underline;\">planning agreements provide an important legal tool for coordinating public interests, particularly those of the municipality or county, and the private interest of the developer in a particular land use.<\/span> The conclusion of planning agreements is thus desirable in order to respect the principle of predictability. If the municipality concluded planning agreements before the new Building Act came into force, it is recommended that the original model agreements be modified to respect the current public law nature of the agreement. At the same time, the principles for negotiations with investors should be modified in this respect.   <\/p>\n\n<p>If you would like more information in this regard, please do not hesitate to contact us.<\/p>\n\n<p>This article is for informational purposes only and does not constitute legal advice or guidance for any particular case.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Planning contracts concluded under the original Building Act are innominate contracts, we have discussed them in more detail in a previous article (link here). With the effectiveness of the new Building Act, planning contracts change their nature and acquire a public law character. The change in the nature of planning contracts will have to be [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":5605,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","inline_featured_image":false,"footnotes":""},"categories":[320,362],"tags":[344,477,478,476,345],"class_list":["post-5766","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-construction","tag-legislation","tag-money","tag-payout","tag-reward","tag-thesis"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Planning contracts under the new Building Act - m2apartners.cz<\/title>\n<meta name=\"description\" content=\"With the entry into force of the new Building Act, planning agreements change their nature and acquire a public law character. 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