TIRANA, March 15 – The Albanian government has suspended the real estate registration process in coastal areas as part of a strategic investment law providing investors tax incentives and state-owned land in return for investment and job creation.
The government decision approved this week suspends real estate registration procedures on agricultural land managed by former state-run agricultural enterprises under communism until a land register supporting strategic investment is established.
The decision comes as a nationwide verification campaign has been launched on agricultural land distributed in coastal areas after some late 2017 abuses identified in a Kavaja beach, some 50 km off Tirana, leading to the arrest of several real estate and local government officials there.
The new decision is also primarily intended to support investment in the tourism industry following legal changes, offering state-owned property and tax incentives for investment in luxury tourist accommodation units.
New luxury accommodation units built by internationally renowned chained-brand hotels or under management or franchise contracts with them, will benefit tax incentives for a ten-year period for building and operating four-star hotels and resorts with an investment value of at least €8 million or five-star units worth at least €15 million, according to a package of tax incentives Albania approved in late 2017.
The government decision also serves a 2015 law offering simplified and accelerated procedures until December 2018 for strategic investments in energy, mining, transport, telecommunication, infrastructure, urban waste, tourism, agriculture and fishing and special economic zones.
Some 2,300 citizens are reported to have applied for real estate registration certificates for land belonging to former state-run agricultural enterprises under communism that was distributed under a 1995 law soon after the collapse of the regime.
Opposition Democratic Party MP Jorida Tabaku condemned what she called the violation of property rights to pave the way for investment without due compensation under the new government decision.
“Land owners have been one of the most discriminated groups for the past five years for the properties they have inherited and enjoy based on every right. Under the government decision approved this week, the government shamelessly gives priority to investors for the property that belongs to somebody else, openly violating not only the country’s constitution, but also one of the most important points set by the EU to open accession negotiations,” said Tabaku.
“The only solution to this mishmash is cancelling the article that takes away properties from owners under the strategic investment law and at the same time the full review of the property restitution and compensation law. As long as private property is not duly treated, we will never have freedom, because private property and freedom are inseparable,” she added.
Albania had some 700,000 hectares of agricultural land in the early 1990s when communism collapsed most of which was distributed under the controversial “7,501 law” portioning agriculture land on a per capita basis and not taking into account compensation of owners expropriated under the 1946 agrarian reform soon after the communists came to power.
Thousands of families in Albania were expropriated by the communists when they took power following the end of World War II and efforts of many post-communist governments to definitively resolve the property restitution and compensation issue have so far failed.
The unresolved property issue has had serious financial consequences as well as social effects in Albania. Not only it holds back foreign investments due to ownership disputes, but it has also resulted in an extra financial bill because of several rulings of the European Court of Human Rights in Strasbourg in favour of families who have been expropriated.
Agriculture is a key sector to the Albanian economy, employing about half of the country’s GDP but producing only a fifth of the GDP, unveiling its low productivity which is hampered by the fragmentation of farm land into small plots and poor financing and technology employed.
