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PR 10/19 | Planning Authority decision is “unfair, irregular and against the principles of natural justice”

Verzjoni bil-Malti

The Commissioner for Environment and Planning within the Office of the Ombudsman has found the Planning Authority’s decision to require holders of CTB concessions to sanction or regularise their property to be “unfair, irregular and against the principles of natural justice”.

The Eighth Schedule regarding Category B concessions, referred to as CTB in short, came into force in August 2012. Residential property owners were able to submit an application to the Malta Environment and Planning Authority to cover illegal development that fell within specific strict parameters. If approved, the applicant would then be allowed to request permission for alterations and additions to the property, and a Compliance Certificate for the provision of new water and electrical services to the dwelling could be issued.

PA Circular 4/12 points out that CTBs do not have an expiry date. The CTB regulations had the effect of restoring the affected properties’ market value to levels comparable to legal properties of a similar description. As a result, these properties became sellable again, and banks were reassured that the effects of the concession were permanent.

With the coming into force of the Development Planning Act in 2016, the CTB regulations were repealed and no further applications could be submitted. In August 2016, new regulations were published that allowed for the regularisation of various types of illegalities, with no specific parameters, as long as these were not deemed to be an “injury to amenity”.

The Kamra tal-Periti had raised a number of concerns with the new regulations, and had published its position particularly regarding reports from members of the profession that the Planning Authority was requiring holders of CTB concessions to regularise their property, at a much heftier fee than what they had originally paid for the concession.

On the 28th January 2019, the Planning Authority published a Circular titled “Category B Concession (CTB) Explained”. The Circular concludes that when an application for development permission is submitted on a site which is covered by a CTB concession, then the irregularity “needs to either be sanctioned or removed, prior to any processing of the application.  If the illegal development cannot be sanctioned, a regularisation application would need to have been submitted and approved prior to the planning application being confirmed as complete.

The Kamra tal-Periti requested the Ombudsman’s office to investigate this matter in March 2019, outlining its opinion that holders of CTB concessions for minor irregularities were facing serious risks on their investment unless the Planning Authority changed its interpretation of the law. Banks that have taken such properties as security against mortgages are also at risk in case of default, as the value of such properties may be much lower than expected as a result.

In a decision delivered on the 7th May 2019, the Ombudsman’s Office concluded that the above quoted paragraph from the Authority’s Circular “is found to be unfair, irregular and against the principles of natural justice” and ordered the Planning Authority to “withdraw and cancel this part of the Circular to the effect that a new application can be submitted on a site covered by a CTB concession without the need for sanctioning, regularising or removing the illegal works covered by the same CTB concession, as long as no further illegal development has taken place on site.

The Council of the Kamra tal-Periti does not condone illegal development in any way, however once certain rights were granted to property owners in the past these cannot be taken away at a later date, more so when the legal ramifications are wide ranging and potentially serious.

 

Planning Authority responds to the Kamra’s concerns about CTBs by citing the funds it has generated as a result

The Planning Authority has responded to the article published by the Kamra on this website regarding the predicament owners of properties covered by CTBs find themselves in as a result of the incorrect interpretation of the law regarding the effects of the concessions they were granted.

As explained in the previous article, property owners who submitted a CTB application to the PA to cover illegal development that fell within specific parameters, together with a payment of €250, were granted the two following concessions, as outlined in PA Circular 4/12:

  1. applications requesting permission for alterations and additions to the same dwelling unit could be accepted (without prejudice to any other requirements); and
  2. a Certificate for the provision of new water / electrical services to the dwelling could be issued as per Article 92 of the Act.

The circular also points out that CTBs do “not have an expiry date“.

The Kamra raised its concerns about the Planning Authority’s insistence that properties covered by a CTB must first be regularised before a new application requesting permission for alterations or additions could be accepted, completely subverting the effects of the CTB, which is a legally acquired right.

In its statement, the Planning Authority confirms that CTBs do not regularise or sanction properties. It also implies that the new regulations are in some way giving people an opportunity by stating that gave the “possibility to holders of CTB concessions to regularize the unauthorized interventions covered by such concessions.” However, it does not comment about various instances where applicants were made to regularise their property, despite being covered by a CTB, and does not comment on the legality or fairness of its unilateral decision not to recognise the concessions granted by CTBs thereby prejudicing owners of such properties, not to mention the banks that have hypothecated such properties as a mortgage security.

The Planning Authority concludes by saying that it “has received 5897 applications for the Regularisation of Development Inside Development Zone from August 2016 until recently. These applications have generated €13,901,159.06 of funds which are distributed as follows: 70% for the Irrestawra Darek scheme, 20% for the Development Planning Fund and 10% for the authority’s administrative expenses in relation to these schemes.”

This would appear to confirm a more cynical explanation as to why the Authority has decided to disregard the legality of CTBs – that its main interest is that of generating funds for the Authority’s schemes rather than seeking equity and fairness.

Members of the public and of the profession are invited to contact the Kamra tal-Periti on info@kamratalperiti.org should they have been compelled or are being compelled into regularising a property covered by a CTB, providing details about their case. All communication will be handled in strict confidence.

Property owners with a CTB concession at risk