Recognized European Valuer REV/PL/PFVA/2029/2/: Perpetual usufruct in Poland. What is perpetual usufruct? Legislative developments following the amendment of 31 August, 2023, to the Real Estate Management Act
(by Małgorzata Mikiciuk, REV)
Perpetual usufruct is a right under civil law and relates to property, and one of the ways in which it can be obtained is through inheritance. It is a cross between ownership title and a limited right in rem.
Perpetual usufruct can only apply to land, and not buildings or other structures and installations built on the land.
Perpetual usufruct was introduced in 1961, when Poland was under communist rule.
The term perpetual usufruct was introduced in the Act of 14 July, 1961, on Urban and Residential Estate Site Management [1].
Under art. 232 § 1 of the Civil Code, natural and legal persons may be granted perpetual usufruct to land owned by the State Treasury or local authorities, or associations of the same, located within urban administrative boundaries or outside of those boundaries but subject to the city’s local zoning plan [2].
Under art. 235 § 1 of the Civil Code, buildings and other installations erected on State Treasury or local authority land or land owned by associations of the same by a perpetual usufructuary become the property of the perpetual usufructuary. The same applies to buildings and other installations acquired by a perpetual usufructuary in line with the relevant provisions of law, when entering into an agreement granting perpetual usufruct to land.
§2. Ownership title held by a perpetual usufructuary to buildings and installations on land subject to perpetual usufruct is a right that follows from perpetual usufruct [3].
As ownership title to buildings and other installations follows from perpetual usufruct, acquisition and sale of perpetual usufruct to developed land always means that ownership title to the structures on that land is also acquired at the same time.
Up until 1989, perpetual usufruct was essentially the only form in which state-owned land in towns and cities could be acquired.
A major change to laws on establishing perpetual usufruct was made in the Act of 29 April, 1985, on Land Site Management and Real Estate Expropriation, which was repealed on 1 January, 1998, in the Real Estate Management Act of 21 August, 1997 (REMA) [4]. The changes concerned the procedure for establishing perpetual usufruct to land [5]. Under art. 27 of the REMA, sale of real estate and granting of perpetual usufruct right to real estate required an agreement signed before a notary, and perpetual usufruct granted to land and transfer of perpetual usufruct by way of an agreement had to be registered in the land and mortgage register.
An agreement establishing perpetual usufruct concluded before a notary must state the following:
The duration of perpetual usufruct; depending on the goal for which the real estate is provided, this will be between 40 and 99 years.
The manner in which the real estate will be used and when this will occur. If the real estate is to be used for property development, the construction start and finishing dates have to be determined.
The amount of the first payment and the percentage rate for annual payments.
If real estate is developed, perpetual usufruct to the real estate is granted as provided for under art. 31 of the REMA, and the buildings and installations on the land are sold at the same time.
The fee for perpetual usufruct is an initial payment and subsequent annual payments. The fees are calculated as a percentage of the price of the land, determined on the basis of valuation.
Under art. 37 of the REMA, land owned by a local authority or the State Treasury is sold at auction, or without an auction being held.
Sale of real estate to the relevant perpetual usufructuary does not require an auction.
There were substantial changes to laws on change of perpetual usufructuary upon adoption on 20 July, 2018, of the Act on Transformation of Perpetual Usufruct into Ownership Title to Land Developed for Residential Purposes [6]. Under art. 1 of the act, as of 1 January, 2019, perpetual usufruct of land developed for residential purposes became ownership title to that land. The act also addresses the issue of the status of developed land connected with that land and with those outhouses and garages, and with other structures and construction installations enabling residential buildings to be used reasonably and correctly.
On 26 May, 2023, the Polish Sejm passed amendments to the Municipal Authority Act, Community Housing Development Act, the Real Estate Management Act, the Transfer Tax Act, and certain other acts. The bill, which had been produced by the Ministry of Development and Technology, was one of a series of measures taken to abolish perpetual usufruct in the Polish legal system [7].
The statement of reasons for the government bill stated unequivocally that a group of institutions would be granted ownership of land due to the commercial function served by land that they held in perpetual usufruct, provided that they had not exercised the transformation right as of that time. This meant that both natural persons and legal persons holding perpetual usufruct granted to land prior to 1 January, 1998, were qualified as entities that could make use of transformation under the act. Thus only commercial entities holding perpetual usufruct to land granted to them prior to 1 January, 1998, i.e. a minimum of 26 years before, counted up until the day the act came into effect (31 August, 2023) would be entities eligible under the act, and in addition this was subject to compliance with the obligation provided for in the agreement granting perpetual usufruct to land [8]. In addition, new rules now apply for calculating prices for land sold to perpetual usufructuaries.
Under art. 198g. 1 of the REMA, a perpetual usufructuary of land could apply for the land to be sold to them for up to twelve months from the day of enactment of the Act of 26 May, 2023, amending the Municipal Authority Act, Community Housing Development Act, the Real Estate Management Act, the Transfer Tax Act, and certain other acts (Journal of laws, item 1463).
2. The right to apply for the land to be sold under section 1 does not apply in the following cases:
- perpetual usufruct was granted to the real estate after 31 December, 1997;
- the perpetual usufructuary did not observe the obligation provided for in the agreement granting perpetual usufruct to land;
- in the case of land located within ports and harbors in the meaning of art. 2(2) of the Act of 20 December 1996 on Ports and Harbors (Journal of Laws of 2023, item 1796);
- the land is used as a family allotment in the meaning of art. 2(5) of the Act of 13 December, 2013, on Family Allotments;
- the land in question is undeveloped.
3. A sale agreement for real estate described in section 1 cannot be concluded if proceedings are in progress to terminate an agreement granting perpetual usufruct to real estate of that kind.
4. Sections 1–3 apply per analogiam in cases where perpetual usufruct is established in a form other than an agreement signed before a notary.
This right to apply to buy the land is exercised upon demand, and is not a right enjoyed automatically. An important issue with respect to these provisions on applying to buy land is that the perpetual usufructuary’s demand cannot be denied.
If the perpetual usufructuary does not manage to apply to purchase the real estate within twelve months, it can initiate the procedure according to generally applicable rules, and in this case the sale agreement will be concluded subject to the consent of the State Treasury or competent local authority.
The issue of the price of land sold to a perpetual usufructuary is addressed in art. 69 sections 1,2 and 3 of the REMA, according to the way in which the real estate is used, and specifically, whether or not the real estate is used for commercial operations.
The amendment to the REMA provides for exceptions that apply for a limited time applicable to certain real estate that meets the requirements laid down in art.198 g(2) of the REMA. These exceptions limited in time apply as of 31 August, 2023, and relate to demands for sale of land to the perpetual usufructuary (part VIa). In this case, the real estate price calculation base is a multiple of the product of the perpetual usufruct annual fee percentage rate and the current value as determined by a surveyor [9].
If the real estate is valued for the purpose of sale, under § 42(4) of the Regulation issued by the Minister of Development and Technology of 5 September, 2023, [10] § 42 sections 1 – 4 apply when the land sold to the perpetual usufructuary is valued.
This includes the fact that land to which perpetual usufruct is granted is valued according to the manner in which the land is used at the time. In principle, this manner of use must correspond to the manner of use stated in the agreement establishing perpetual usufruct.
The real estate market’s reaction to the act of 26 May, 2023, remains to be seen in practice. Even at the moment, not all perpetual usufructuaries who invest or who conduct business wish to purchase land, and this is mainly due to the financial terms, such as the current land value, as the land value is the basis for setting the sale price or reaching the conclusion that exercising perpetual usufruct is the right way to pursue business interests11.
For perpetual usufructuaries who hold land located right in the city center or on other sites that currently have a great deal of potential for development and which have become more attractive for development over the years due to change such as changes to zoning documentation [12], transformation of perpetual usufruct into ownership title might present a business opportunity, while for others the act might be irrelevant or of little interest.
[1] Ustawa z dnia 14 lipca 1961 r.o gospodarce terenami w miastach i osiedlach ( Dz. U.1961 , nr 32, poz.159, tekst pierwotny)
[2] oznacza skrót Kodeks cywilny . Kodeks Cywilny Ustawa z dnia 23.04.1964 r. (Dz. U. z 2024 r. poz. 1061 ze zm.),
[4] u.g.n – skrót dla ustawy o gospodarce nieruchomościami. Ustawa z dnia 21 sierpnia 1997 o gospodarce nieruchomościami (Dz. U. z 2024 r., poz. 1445 ze zm.)
[5] H. Ciepła Przekształcenie użytkowania wieczystego gruntów przedsiębiorców w prawo własności, Wolters Kluwer, Warszawa 2025, s. 21
[6] Ustawa z 20 lipca 2018 r. o przekształceniu prawa użytkowania wieczystego grunt ów zabudowanych na cele mieszkaniowe w prawo własności tych gruntów (Dz. U. z 2024 r. poz.386)
[7] RP – skrót – Rzeczypospolita Polska . Ustawa z dnia 26 lipca 2013 r. o zmianie ustawy o samorządzie gminnym, ustawy o społecznych formach rozwoju mieszkalnictwa, ustawy o gospodarce nieruchomościami, ustawy o podatku od czynności cywilnoprawnych oraz niektórych innych ustaw. ( Dz. U. 2023 , poz. 1463)
[8] H. Ciepła Przekształcenie użytkowania wieczystego gruntów przedsiębiorców w prawo własności, Wolters Kluwer, Warszawa 2025, s. 14-28
[9] Szacowanie nieruchomości praca zbiorowa pod red. J. Dydenki, Wolters Kluwer, Warszawa 2024, s. 240-253
[10] Rozporządzenie Ministra Rozwoju i Technologii z dnia 5 września 2023 r. w sprawie wyceny nieruchomości (Dz. U. z 2023 r. poz. 1832).
[11] H. Ciepła Przekształcenie użytkowania wieczystego gruntów przedsiębiorców w prawo własności, Wolters Kluwer, Warszawa 2025, s. 15.
[12] Ustawa z dnia 7 lipca 2023 r. o zmianie ustawy o planowaniu i zagospodarowaniu przestrzennym oraz niektórych innych ustaw (Dz.U. 2023 poz. 1688 ze zm.),
