Sale of a small plot of land without preemptive right of KOWR

The Supreme Court o Poland, in a resolution dated October 17, 2023, ref. III CZP 113/22 confirmed that a land parcel of less than 0.3 hectares created after a geodetic division of a larger agricultural property is not subject to the provisions of the Act on Formation of the Agricultural System.

Restrictions on trading in agricultural land

Trading in agricultural land in Poland is subject to far-reaching restrictions under the provisions of the Act of April 11, 2003 on the Formation of the Agricultural System (hereinafter: FAS Act), such as:

1. the requirement to have agricultural qualifications,
2. the requirement of the National Agricultural Support Center’s approval for the acquisition of real estate;
3. the requirement of the National Agricultural Support Center’s approval for the acquisition of shares or stocks in an agricultural company
4. the National Agricultural Support Center’s right of first refusal,
5. the purchaser’s obligation to operate a farm, or the prohibition on leasing the acquired property.

These restrictions are intended, among other things, to prevent excessive concentration of agricultural real estate and to ensure that agricultural activities on farms are carried out by qualified persons. For more information on restrictions and purchase of agricultural land in Poland, see our investor zone.

Agricultural land plot smaller than 0.3 hectares

The provisions of the FAS Act do not apply to agricultural real estate, where the area of agricultural land is less than 0.3 hectares. In practice, a problem arose as to how to treat a situation in which an agricultural property consists of several plots of land, with a total area exceeding 0.3 hectares, but the subject of sale is a single plot of land not exceeding 0.3 hectares. Doubts arose from the fact that, from the point of view of the provisions of the Civil Code and the prevailing position of case law, all such plots of land together constitute a single agricultural property if they are registered in one land and mortgage register. Consequently, the determination of whether such agricultural property meets the minimum area standard of 0.3 hectares should be based on the sum of the area of agricultural land of all land parcels registered in the land register.

On the other hand, a different interpretation has been adopted in the practice of trading, according to which the minimum area norm of 0.3 hectares should be determined only for the plot or plots of land being sold separated from the larger agricultural property.

Supreme Court Resolution – sale of small agricultural plots

The Supreme Court of Poland, in a resolution dated October 17, 2023, case no. III CZP 113/22 took the position that a plot of land of less than 0.3 hectares created after a geodetic division of a larger agricultural property is not subject to the provisions of the FAS Act. Thus, the Supreme Court confirmed the possibility of free circulation of registered plots of land that do not exceed the said minimum area standard.

This will certainly enable easier sale of small agricultural plots to non-self-employed farmers, especially to those planning to use it for construction purposes.