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PROPERTY LAW
Types of ownership
Freehold/full ownership (volle eigendom)
• The Dutch Civil Code defines ownership as the most
comprehensive and complete right a person or legal entity
can have in relation to, inter alia, real estate. The transfer of
ownership requires the execution of a deed in front of a civil-
law notary in the Netherlands and the subsequent registration
of this deed with the Land Registry (Kadaster).
• If a property is owned by more than one person this is referred
to as co-ownership or community of property.
Apartment rights (appartementsrechten)
• The division of property into apartment rights is a specific
form of (co-)ownership by various persons of a property or
a group of properties. An apartment right entitles the holder
thereof to the exclusive use of a certain part of a property and
the joint ownership, with the other apartment owners, of that
property.
• Division into apartment rights requires the execution of
a deed in front of a civil-law notary in the Netherlands
and registration thereof with the Land Registry. The deed
describes the areas that are designated for exclusive use
only and the common areas (such as elevators, roof and
foundation of the property). The deed includes the terms of
use and the rights and obligations of the apartment owners.
Transfer of and use of an apartment right may be limited in
the deed. Some urban areas require a property division permit
from the municipality. Upon the acquisition of an apartment
right the apartment owner becomes a member of the owners
association by operation of law. The owners association is
responsible for, inter alia, maintenance of the common areas.
Economic ownership
• Economic ownership is a contractual arrangement and does
not constitute a right in rem. Economic ownership is not
strictly defined under Dutch contractual law or real estate law.
However, for tax purposes economic ownership is defined as,
inter alia, a combination of contractual rights and obligations
pertaining to the property comprising of a contractual interest
in such property which interest at least includes some form of
risk of depreciation of value of that property.
Ground lease (recht van erfpacht)
• Ground lease is the right (in rem) to hold and use somebody
else’s property under the terms and conditions included
in the deed of ground lease. A ground lease is established
through the execution of a deed in front of a civil-law notary
in the Netherlands and the registration thereof with the
Land Registry. The terms and conditions included in the
deed address the allowed usage, duration of the ground
lease, payment of ground lease payments (erfpachtcanon),
termination etc.
Right of superficies (recht van opstal)
• A right of superficies is the right (in rem) to own or acquire
buildings, works or plants in, on or above the immovable
property of another person. A right of superficies is established
through the execution of a deed in front of a civil-law notary
in the Netherlands and the registration thereof with the Land
Registry. The terms and conditions included in the deed
address the allowed usage, duration of the right of superficies,
payment of a retribution (retributie), termination etc.
Rights affecting ownership
Easement (erfdienstbaarheid)
• An easement is a right (in rem) which encumbers an
immovable property in favour of another immovable property
for the use and utility of that property. An easement is
established through the execution of a deed in front of a civil-
law notary in the Netherlands and the registration thereof
with the Land Registry. An easement can also come into
existence through acquisitive prescription.
Mortgage (hypotheek)
• A right of mortgage is a right (in rem) which provides security
for the due performance of a monetary obligation by the
debtor (i.e. the payment of a sum of money) and provides the
mortgagee the right to publicly sell the mortgaged property
in case of a default in the secured obligations. A right of
mortgage provides for a preferential right over other creditors
in the event of bankruptcy or forced sale of the relevant
property. A right of mortgage is created through the execution
of a deed in front of a civil-law notary and the registration
thereof with the Land Registry.
An obligation attached to a certain capacity
(kwalitatieve verplichting)
• An obligation (pertaining to the ownership of property) to
refrain from certain acts in relation to a certain property and/
or allow a third party to perform certain acts with respect to
that property can be laid down in a deed executed in front of
a civil-law notary which is registered with the Land Registry.
Subsequent owners must adhere to these obligations/respect
such third party rights.
Municipality preferential right
(voorkeursrecht Gemeente)
• A Municipality may designate a certain area as a so-called
preferential right’s zone. Any property located in such zone
must be offered for sale to the Municipality first before it can
be transferred to a third party. A transfer without the approval
of the Municipality is null and void.
ACQUISITION PROCESS:
KEY STAGES
• Foreign investors wishing to carry out real estate transactions
in principle do not need any prior authorisation. Prior to
or during due diligence, and/or negotiations, it should be
considered whether the transaction should be executed as a
share deal or an asset deal (also see below under Tax).
Negotiations
• An investment memorandum may be prepared by the seller/
agent providing some general details on the property. As a
preliminary step, a non-disclosure agreement is then often
proposed by the seller/agent in order to allow access to the
property and further information and documentation. The
would-be purchaser may issues a letter of intent which may
include certain preliminary terms and conditions as well as
an exclusivity period. The letter of intent and non-disclosure
agreement may be combined in one and the same document.
Discussions are usually pursued on the basis of this letter of
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Investors Guide to Europe 2015