The Royal Decree Law prepared by the Government to regulate the authorization regime for foreign investors is also open to the real estate sector. The text, which will soon reach the Council of Ministers, opens the door for the Executive to give the green light to any real estate operation of more than 500,000 euros.
The so-called anti-takeover shield was created to give the Government the possibility of preventing the taking of more than 10% of a foreign company by an investor from outside the EU to try to avoid opportunistic purchases. However, in the royal decree with which it seeks to regulate this authorization regime, the type of investments affected is extended, also to real estate and financing contracts.
All this according to the text that the Secretary of State for Commerce put out for public consultation a few months ago. The sources consulted indicate that the Government is awaiting the opinion of the Council of State to take the Royal Decree Law to the Council of Ministers.
In the case of real estate operations, this movement occurs at a time when there is a strong investment of both funds and large wealthy families, which has pushed up the price of rent and housing. The low limit imposed by the Government – of 500,000 euros, barely the cost of a flat in the center of Madrid – will mean that almost every real estate transaction carried out in the capital or in large cities such as Barcelona must have the approval of the Government. It is true that only those of more than 500 million will reach the Council of Ministers and the vast majority will only go through the Ministry of Industry.
The regulation extends the request for authorization also to financing operations. All those that exceed one million euros and have a repayment period of more than 12 months will be under the Executive’s gaze. It also involves temporary unions of companies, foundations, economic interest groups, with participations of foreigners of more than one million euros.
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