The Amendment of the Consolidated Text of the Law on Land and Urban Rehabilitation begins

 1. A REFORM AIMED TO INCREASING LEGAL CERTAINTY IN THE FIELD OF URBAN PLANNING

On 13 December 2022, the Council of Ministers approved a preliminary draft bill (anteproyecto del ley, "Preliminary Draft") to amend the Consolidated Text of the Spanish Law on Land and Urban Rehabilitation approved on 30 October 2015 by Royal Legislative Decree 7/2015 (the "Spanish Land Act"). The Government's objective is for the amendment to enter into force by the end of 2023, although its approval as a final draft bill (proyecto de ley) and the entire parliamentary approval procedure is still pending.

The Preliminary Draft, although brief, introduces important amendments that aim to increase legal certainty in the field of land and urban planning.

Approving a planning instrument is technically and legally complex. However, once approved, any type of procedural irregularity, no matter how small it may be, can lead to its full nullity (nulidad de pleno derecho) projected in cascade on all non-definitive derivative acts.

The following are the main measures proposed by the Government to address this problem.

2. THE PRELIMINARY DRAFT IN FOUR KEY POINTS

In general terms, the Preliminary Draft focuses on the following issues:

a) Nullity and revocability. It recognises the mixed nature (technical-legal) of land and urban planning instruments and introduces a list of formal defects which, due to their significance, determine the nullity of the relevant planning instrument. The rest of the defects not expressly listed may be remedied, thus avoiding "disproportionate annulments".

b) Positivation of the doctrine of partial nullity. The figure of partial nullity of land and urban planning instruments is introduced when such nullity can be individualised with respect to a specific land area, provision or particular specifications.

c) Limitation of nullity in cascade. Until now, the declaration of nullity of a land and urban planning instrument has implied the nullity of all its development planning instruments and even of its implementation acts. However, the Preliminary Draft seeks to limit this nullity in cascade to only those instruments and acts that contain the same nullity defect as the instrument declared null and void.

d) Limitation of the public action on urban planning matters. The right to exercise the public action on urban planning matters is significantly limited insofar as it is expressly linked to the protection of general interests.

3. NULLITY AND REVOCABILITY

The most important amendment introduced by the Preliminary Draft is the new proposed regime of nullity and revocability of land and urban planning instruments, which is summarised below:

a) Legal nature of land and urban planning instruments. A new paragraph 2 is introduced in article 4 of the Spanish Land Act to establish the diverse (mixed) legal nature of land and urban planning instruments which are composed of both: (i) strategic decisions and their implementation and (ii) general or particular legal rules.

b) Grounds for nullity of land and urban planning instruments. The Preliminary Draft propose to change the name of article 55 of the Spanish Land Act (now entitled Null and void acts) to Nullity and revocability of land and urban planning instruments and also provides for a complete revision of its content.

In accordance with the new proposed wording of the first paragraph of article 55, full nullity due to procedural defects may only be declared on the following grounds:

• the omission of the environmental assessment procedure;
• the omission of the public information and participation procedure;
• the omission of procedures for the participation of other entities in relation to mandatory reports which absence is particularly complex to correct (among others, the hydrological report, the coastal report, the report on roads and other structural infrastructures); and
• the absence or obvious inadequacy of the memorandum justifying the planning decisions taken.

The other formal defects not expressly listed in the aforementioned paragraph will not entail the full nullity of the urban planning instrument, and may be remedied with retroaction of proceedings to the appropriate procedural moment (revocability).

If the defect is revocable (instead of null and void), all actions not affected by the defect will be preserved and the Administration will have one year (extendable for an additional period of six months) to rectify them. In the meantime, the revoked urban planning instrument will remain valid and effective except for the specifications that have been affected by the revocation.

This amended article 55 of the Spanish Land Act, if finally approved, will have important practical implications and will involve examining on a case-by-case basis whether the defect in the concerned instrument entails the application of the regime of full nullity or revocability.

4. POSITIVATION OF PARTIAL NULLITY

The proposed new wording of article 55 of the Spanish Land Act includes in its third paragraph a positivation of the principle of partial nullity introduced by the Supreme Court judgement 744/2020 of 4 March 2020.

In accordance with the new wording of the article, the nullity of land and urban planning instruments will, in any case, be partial when it can be individualised with respect to a specific land area, provision or particular specifications that have no relevance for the rest of the plan.

The practical relevance of this provision can be clearly seen in Supreme Court judgement 569/2020 of 27 May 2020 in relation to the General Plan for Supplementary Development of Yaiza (Lanzarote), which was approved with the omission of the mandatory coastal report. In that case, the Supreme Court, in application of the principle of partial nullity that would now be introduced in this article 55.3, agreed that the nullity should only affect the area affected by the maritime-terrestrial public domain and its easement area, with the rest of the plan remaining in force.

5. LIMITATION OF NULLITY IN CASCADE

The proposed new wording of article 55 of the Spanish Land Act includes in its fourth paragraph a limitation of the effects of the so-called nullity in cascade.

In accordance with the aforementioned article, the invalidity of a land and urban planning instrument should only affect its development instruments and the implementing acts when they suffer from the same defect as the null and void instrument. However, their validity will be maintained if said development instruments or acts have sufficient coverage in the development instrument prior to the one that has been declared null and void or in the applicable regulations.

The Preliminary Draft seeks, once again, to limit the effects of a declaration of nullity which, until now, had serious practical implications (sometimes disproportionate) as it entailed the nullity of all development planning and of the acts approved by virtue of the instrument declared null and void.

6. PUBLIC ACTION ON URBAN PLANNING

The Preliminary Draft modifies the wording of articles 5.f) and 62 of the Spanish Land Act to give a new, more limited content to public action on urban planning.

Specifically, the first change proposed by the reform refers to the subjective right to bring a public action. In contrast to the current wording, which allows any person to bring a public action, the Preliminary Draft grants this right only to individuals and non-profit legal entities.

Likewise, the public action must be brought in protection of the general interests linked to land and urban planning and regarding material or substantive aspects. It cannot be based on merely formal defects, be contrary to good faith or constitute an abuse of rights, nor can it seek the recognition and re-establishment of a particular legal situation.

Finally, the Preliminary Draft expressly introduces that the withdrawal of the public action cannot be accompanied by a financial compensation. This is an attempt to avoid the professionalisation that used to exist in the exercise of such public action.

7. OTHER AMENDMENTS

Although the core of the reform is to be found in the changes described above, the Preliminary Draft takes the opportunity to modify some other matters:

a) Negative silence. The cases of application of negative silence declared unconstitutional by the judgments of the Constitutional Court 143/2017, of 14 December, and 75/2018, of 5 July (subdivisions, segregations and other acts of division of plots) are eliminated.

However, the building works of dwellings subject to a public protection regime, intended for social renting, promoted by the Public Administration, its dependent entities or by means of public-private collaboration formulas are eliminated from the regime of negative silence.

b) Compensation for urban development actions. Article 38.2.a) of the Spanish Land Act is proposed to be amended following its declaration of nullity by the Constitutional Court judgement 218/2015, of 22 October. Without prejudice to a subsequent regulatory development, the new wording clarifies how compensation is to be calculated for preventing the exercise of the right to participate in the development or altering its conditions.

c) New telematic platform. Finally, the Preliminary Draft contains the commitment to make available to the Public Administrations a telematic platform to speed up the issuing of sectoral reports in the processing of land and urban planning instruments.

8. CONCLUSIONS

As explained, the Preliminary Draft introduces a series of measures aimed to softening the strict application of the legality principle that has prevailed in Spain in relation to land and urban planning instruments, and the serious consequences that derived from this strict application.

The practical impact that this reform has for Spanish urban planning operators is undeniable, so it is important to follow closely the next steps in the approval process of the Preliminary Draft and the eventual regulatory development of the Spanish Land Act.