Czech Republic: restrictions to be lifted on foreign purchases of real estate

Two bills are currently proposed which would make it easier for foreigners to buy commercial property and secondary residences in the Czech Republic.

The first bill, which is currently having its second reading before Parliament, would allow foreigners to make unrestricted purchases of any property other than secondary residences or agricultural land.

Secondary residences, which are newly defined in the first bill, include flats, family houses and buildings for individual recreation as well as building land and land designated by planning permit for building family houses or buildings for individual recreation.

Restrictions on foreign purchases of secondary residences, which are not as tight as those for agricultural land, would be lifted under the second bill (which is not yet before Parliament) from 1 May 2009, at the end of a transitional period negotiated on EU accession.

Agricultural land consists of all land which forms part of or belongs to the agricultural land fund and all land set aside as woodland. It will remain subject to tight restrictions until May 2011, at the end of another transitional period negotiated by the Czech Republic on its accession to the EU.

Law: Act No. 219/1995 Coll., Foreign Exchange Act