The Community of Madrid amends the Regional Land Law regarding new urban planning developments.

Written on 28 May 2018

The amendment of the Regional Land Law completes the existing legal framework applicable to the development and execution of the urbanization works, enabling to conduct the urban execution units (unidades de ejecución) in different phases. Thereby, this avoids the current differences with the Urban Management Regulation.

On 19 May 2018, Law 2/2018, amending Law 9/2001, dated 17 July 2011, of Regional Land Law of the Community of Madrid entered into force, regulating the possibility to conduct the urban execution units (unidades de ejecución) in different phases.

Although articles 20 and 135 of Law 9/2001, dated 17 July 2011, of Regional Land Law of the Community of Madrid (“RLLCM”) established the urban planning developments framework through urban execution units, the fact is that it did not regulate the possibility to develop those urban execution units in different phases and neither the possibility to grant the corresponding licenses of first occupation.

In contrast to RLLCM, Royal Decree 3288/1978, dated 25 August, of Urban Management Regulation for the development and implementation of the Urban Land Act (“UMR”), provides expressly the possibility to grant licenses of first occupation once the reception of a part of the urbanization works within an execution unit has taken place.

Notwithstanding the differences between the RLLCM and the UMR, the Administrative Disputes Chamber of the High Court of Justice of Madrid has recently passed several judgments rejecting the granting of licenses of first occupation to phases integrating an execution unit which urbanization works have been completed. The Court based its reasoning according to articles 20 and 135 of RLLCM.

In particular, court rulings dated 8 March 2017 (appeal nº 468/2018) and 15 March 2017 (appeal nº 729/2015), among others, stated that although a phase within an execution unit has the urban plot condition, this did not imply that the license of first occupation could be granted. This license could only be awarded once the urbanization works of the entirely execution unit were completed and certified by the Administration.

According to the High Court of Justice of Madrid criteria, even if the urbanization works of an execution unit were originally planned, executed and certified by phases, this did not involve the fact that we were operating a sole execution unit. And therefore no license of first occupation could be granted by phases.

This situation motivated the amendment of articles 99 and 135 of RLLCM in order to enable that the urban execution units can be conducted in different phases, under the condition that those phases work independently and whose urbanization works may be individually certified by the Administration. In such case, first occupation license may be granted.

The RLLCM amendment will have a clear positive impact on the housing development and will contribute to unlock the urban planning developments that were about to be completed in the Community of Madrid and whose urbanization works have been carried out by phases.