Acquisition of industrial real estate by a foreigner – how to obtain a permit?

Due to highly skilled workers, attractive geographic location, and economic stability, Poland attracts the attention of potential foreign investors. The procedure for acquiring real estate in Poland for foreigners from outside the European Economic Area is strictly regulated. The required procedures can significantly delay and complicate the course of such a transaction.

The legal basis for the acquisition of real estate by foreigners in Poland is the Act of March 24, 1920, on the acquisition of real estate by foreigners, which defines the conditions and procedures for obtaining permission to acquire real estate by persons who are not Polish citizens.

How does the act define a foreigner?

The Act on the acquisition of real estate by foreigners defines a foreigner as:

• a natural person who is not a Polish citizen;
• a legal person with its registered office abroad;
• a partnership without legal personality consisting of persons mentioned above, with its registered office abroad, established in accordance with the legislation of foreign countries;
• a legal person and a commercial partnership without legal personality with its registered office in the territory of the Republic of Poland, controlled by foreigners.

The person referred to in point 4 is defined as a commercial partnership or legal person directly or indirectly controlled by:

1. natural persons who are not Polish citizens (e.g., a company based in Wrocław, where a majority of shares are owned by a foreigner who is a citizen of Kyrgyzstan), or
2. companies or legal persons based abroad (a majority of shares in a company from Wrocław are owned by a company established in India and having its registered office there).

It is worth noting that as a result of Brexit, the United Kingdom has lost its membership in the EU and the European Economic Area. Currently, its citizens and entrepreneurs are treated as foreigners.

Legal basis and acquisition procedures

As a rule, foreigners are obliged to obtain permission to acquire real estate. However, the Act provides many exceptions. An example of such an exception would be the acquisition of real estate for statutory purposes, where a foreigner – understood as a legal person or commercial partnership with its registered office in the territory of the Republic of Poland, controlled by foreigners – acquires undeveloped real estate located in urban areas, with an area not exceeding 0.4 hectares. Statutory purposes refer to the object of activity of a given entity.

An application for permission is submitted to the Ministry of the Interior and Administration. It must contain information about the applicant, the property, the seller, the legal form of property acquisition, and the purpose of its acquisition. Moreover, entrepreneurs acquiring real estate for business purposes should demonstrate that the acquisition of real estate is related to the objectives arising from the nature of their business activity. The obtained permission is valid for two years from the date of its issuance.

The regulations provide for the possibility of objecting to the issuance of a permit by the Minister of National Defense, and in the case of agricultural land – by the minister responsible for rural development. The Minister of National Defense may object to any type of real estate. Due to Russia’s aggression against Ukraine and issues related to safeguarding national security, such objection could be raised against a foreigner associated with Russia who would apply for permission to purchase real estate.

Together with the application for permission, a number of documents confirming the legal status of the applicant or the source of funds for the purchase of real estate must be provided.

Legal consequences of violating the Act

Violation of the provisions regarding the acquisition of real estate by foreigners in Poland may even lead to the invalidity of the transaction. The finding of the invalidity of the acquisition of real estate due to a violation of the provisions of the Act is qualified as absolute invalidity. This means that the act of acquiring real estate was already invalid at the time of its execution and did not produce any legal effects. Such an event cannot be recognized as valid with retroactive effect, as the provisions of the Act do not provide for such a possibility. Therefore, it is extremely important to comply with all procedural requirements indicated in the Act.

Summary                                                 

The acquisition of industrial real estate by foreigners in Poland is a process requiring attention, diligence, and a good understanding of legal regulations. It is worth noting that the presented procedure concerns only the purchase of real estate by a foreigner. When selling real estate by a foreigner, obtaining permission from the Ministry of the Interior and Administration is not necessary.

Due to the complexity of the process of acquiring industrial real estate by a foreigner and the problems that may arise as a result, it is worth considering whether we will need the assistance of a specialist who will perform all the necessary actions on our behalf.