New EU scheme to ensure property buyers' safety

Thursday, June 30, 2011

Sarah Kendell

A pilot scheme currently being trialled in the Netherlands and Spain will see buyers able to apply their own country's laws to property purchases abroad, ensuring their legal safety in the event of developer fraud.

The Cross Border Electronic Conveyancing (CROBECO) scheme, expected to roll out across other EU countries later this year, allows for the process of buying a home to be settled in the buyer's own country, meaning they will be protected by their own laws if there are unforeseen complications with the purchase.

Lib Dem MEP Diana Wallace told the Daily Telegraph she hoped CROBECO would provide "a transparent administration of property deals and a quick and clear judicial process in case something goes wrong." "The EU has a role to play in helping to facilitate property deals across borders and at the very least provide a framework of legal certainty", said Wallace.

With widespread problems for property buyers in Spain in particular, who have found their homes in dispute usually due to planning restrictions they were unaware of on purchase, and have no clear course for seeking compensation, this will come as very welcome news. Buyers of problem properties will now be able to undergo the compensation process in their own country's court, which will simplify the act of getting adequate legal representation and give claims a better chance of success.

Hi,

Just found this info, and I appreciate it's a bit out of date, but has anyone got any new information as it states that it is coming to other EU countries later in the year ???

Following a very short period of research during which I failed to find anything on the Telegraph wesite referring to Sarah Kendell, I tracked down the following:

http://mepli.blogspot.com/2010/11/crobeco-cross-border-electronic.html

From what I can read this only applies to the normalisation of documents between various nations (that is a formula which allows conveyancing in one nation to be accepted by another).  Property law and the legal system will remain "as is", so it seems unlikely, given the Spanish propensity for vascillation, that a search carried out by a lawyer in say the UK will be any more likely to be backed up by truthful answers than if a Spanish lawyer were involved.  Many more deals will fail simply because the required information is not forthcoming.  The way for developers in Spain seems to be to rake in as much money as possible, hide it away, and then apply to the court for insolvency, which the court rapidly approves, making it just as unlikely that any money will be left over for the injured party.

I know that I am an incorrigible sceptic, but I cannot see that this will do anything other than allow you to sue a lawyer in your own country who will probably be able to show that he too was conned.  I certainly cannot see how this will result in

"Buyers of problem properties will now be able to undergo the compensation process in their own country's court, which will simplify the act of getting adequate legal representation and give claims a better chance of success"

as you will still be seeking redress via a Spanish court.  I sincerely hope that I am wrong.