26-04-2024
Mandatory Checks for Unpaid Public Liabilities Before Finalizing Property and Vehicle Transactions
The administrative burden in case of transactions with real estates or motor vehicles shall be decreased

By virtue of the new amendments to the Tax-Insurance Procedure Code (“TIPC”), coming into effect on 03.05.2024, the obligation for citizens and businesses to submit declarations for absence of unpaid public liabilities prior to transactions with immovable property and vehicles, would be abolished.

 

 

Prior to these amendments to TIPC, individuals and entities were obligated to present declarations for the absence of unpaid public liabilities whenever they wished to transfer ownership rights over their immovable property or to establish rights in rem thereof, as well as in transactions involving motor vehicles. Instead of signing a declaration by the party to the transaction, notaries or registry judges will be now required to conduct an actual check for such liabilities, which will be performed electronically.

 

 

For this purpose, notaries and registry judges will now have remote access to the information systems of the National Revenue Agency. This setup enables electronic information exchange and provides the possibility to perform inquiries and receive information in real time.

 

 

The amendments will provide partial relief for citizens and businesses in terms of their obligations to secure/compile a certain set of documentation for transactions involving real estate or motor vehicles.

 

 

On the other hand, it is expected that this will also protect the interests of the fiscal authority - until now, there has been a malpractice where a debtor intentionally failed to declare their liabilities, with the aim of ensuring the funds obtained from the deal were not used to settle their public debts, as well as to "release" themselves of material assets which could potentially be targeted in event of enforcement proceedings. Significant financial losses for the state have been identified as a result of such "erroneous" declarations. In these cases, public enforcement officers sometimes proceeded to notify the prosecutor's office of a crime under Article 313 of the Penal Code (declaring false data), but the penalty provided in this provision often did not correspond to the damage to the state.

 

 

As an additional guarantee for the fiscal authority, notaries and registry judges will bear joint liability for the obligations due by the respective party to the transaction (if any), in case they have issued/registered the respective act before the settlement of the outstanding public liabilities.

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