Legal Briefing

The Squatting and Vacancy Act: good news and bad news

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The Netherlands | 01 November 2010

Squatting HAS BEEN A PHENOMENON in the Netherlands since the 1960s. Vacant property is occupied by persons without a valid legal basis. In practice, it has proved difficult for the owner to have squatters removed from the property. This will now change, as the Squatting and Vacancy Act (the Act) came into force on 1 October 2010.

The idea behind the new Act is primarily to control the unacceptable violation of the right of ownership caused by squatting. Additionally, the world of squatters has become tougher: the initiators of the Act therefore proposed to classify squatting as a crime rather than an offence. The Act also offers instruments to control vacancy in non-residential property (Dutch Lower House, 2007/08, 31 560, Explanatory Memorandum no 3, p1).

Currently, full or partial vacancy of office buildings and stores is widespread, and owners and users must be prepared for the favourable and less favourable effects of this Act. A favourable effect is the possibility of eviction of squatters under criminal law; a less favourable outcome is that municipalities can control the uses made of vacant commercial premises.

Good news: eviction under criminal law

Under the old Article 429 series of the Dutch Criminal Code, the squatting of premises that had been vacant for less than a year was an offence. A squatter who committed such an act risked imprisonment for a maximum period of four months or a fine of the third category (€6,700). The squatting of premises that had been vacant for more than a year was not punishable.

Now a new Article 138a of the Dutch Criminal Code has been included in the Act. This replaces the Article 429 series and defines squatting as a crime, even for premises that have been vacant for more than a year. Squatters risk imprisonment for a maximum period of one year (and in the event of threat and/or squatting by several persons, a maximum of two years) or a fine of the fourth category (€18,500).

More importantly, a new Article 551a of the Dutch Code of Criminal Procedure has been introduced. Until recently, courts and Courts of Appeal gave different answers to the question whether or not squatted premises (that had been vacant for less than a year) could be cleared under criminal law. Some said it was possible (for example, the Amsterdam Court of Appeal, 31 March 2009, LJN BH9173), while others believed it was impossible, explaining that the right to clear the premises was not specifically regulated by law and arresting a squatter did not put an end to their right to inviolability of their home, as recorded in the constitution, among other places (Leeuwarden Court of Appeal, 25 November 2008, LJN BG5205). The Dutch Supreme Court cut the knot on 9 October 2009 and confirmed the latter: without further formal legislation there is no legal basis for clearing squatted premises under criminal law (Dutch Supreme Court, 9 October 2009, LJN BJ1254). That legal basis has now been created. Article 551a of the Dutch Code of Criminal Procedure authorises investigating officers to evict squatters from squatted premises and regulates this authority.

Squatters have protested against the Act. It was apparent from banners stating ‘Your laws, not ours!’, seen in Amsterdam after the Act came into force, that squatters may not put an end to the occupation of vacant premises. Opponents of the Act have argued that it is a violation of human rights, including each person’s fundamental right to the inviolability of their home. Moreover, they believe that the Act does not solve the housing shortage. It therefore remains to be seen whether the ban on squatting, the applicable penalties and the risk of eviction under criminal law will be a deterrent to squatters or will reduce squatting.

Following this, it would appear that the ‘preventive’ objective of the legislature may not be achieved. What has been achieved, however, is that squatted premises can be cleared more easily, and sooner, than they have been since the judgment of the Dutch Supreme Court of 9 October 2009.

In summary: good news for the owners and users of squatted premises.

Bad news: municipal control over vacant commercial property

Because, as stated above, vacancy may not increase as a result of the ban on squatting, the Vacancy Act has also been amended. As a result of that amendment, municipalities will have a certain degree of control over the use of vacant premises.

The Vacancy Act offers municipalities the opportunity to adopt vacancy bylaws. These bylaws may provide that the owner of a commercial property is required to inform the municipality of the vacancy after a period of at least six months. The municipality must keep a ‘list of vacant property’ and consult with the owner on the use of the premises within three months, a process know as a ‘vacancy consultation’. If the owner has not solved the vacancy within a period of at least twelve months, the municipality may propose a user. If, three months after the proposal by the municipality, the owner still has not found a user of their own, they must accept the user proposed by the municipality. If the owner fails to comply with their duty to report, the municipality may impose an administrative fine. Other existing statutory rules also allow municipalities to take administrative enforcement action and to impose an order subject to a penalty.

That development is less favourable for owners of commercial property. Municipalities can, as it were, control the use of vacant commercial property. It would even appear that municipalities can force owners, as far as they themselves do not arrange for the occupation of vacant commercial property, to tolerate a different designated use, such as for residential purposes. ‘Illegal squatters would then be replaced by legally squatting municipalities,’ stated the director of De Vereniging van Institutionele Beleggers in Vastgoed, Nederland (trade association for property owners) in the Financieele Dagblad, 16 October 2009. This applies all the more because the G4 (the four largest municipalities) stated in that same article that it intended to introduce a vacancy charge, as municipalities do not have the resources to enforce vacancy bylaws.

Conclusion

The news is both good and bad for owners and users. The good news is that eviction under criminal law is now possible. The Act puts an end to the discord between the courts and the Courts of Appeal, and also the undesirable situation created by the Dutch Supreme Court (that eviction under criminal law was impossible). The question is whether the Public Prosecutor’s Office will enforce the law and will not evade its responsibilities – as it was known to do before the Dutch Supreme Court judgment – on the grounds that ‘eviction proceedings under civil law are also possible’. The bad news is that municipalities can control the use (and also the temporary designated use) of vacant commercial property by means of vacancy bylaws if the owner is unable to find a user in time; all the more so since municipalities, in addition to the enforcement instruments already available to them under administrative law, are also threatening to introduce a vacancy charge.

Live-in guardians (to prevent squatting) are likely to benefit from the introduction of this legislative proposal. Prevention is (and was) better than cure. In this way, not only the risk of squatting, but also – if the municipalities adopt vacancy bylaws – the risk of interference (and charges) by municipalities is minimised. However, the question is how many users are required per square meter to avoid such interference.