The legal principle of accession
Before elaborating on the building right, we should first briefly discuss the principle of accession ("natrekking"/ "droit d'accession"). On the basis of this principle, ownership rights with regard to constructions above and beneath a parcel will, in principle, belong to the landowner. The owner of the land will therefore, as a rule, become the owner of what is built above and below his land.
However, multiple land utilization - by accumulating several rights of ownership of immovable property regarding the same ground - deviates from this principle since ownership rights regarding different ‘volumes' above and beneath the ground are allocated to different persons, who are not necessarily the owner of the land.
The establishment of a building right deviates from the principle of accession
Since the principle of accession is not mandatory, parties can explicitly or tacitly renounce it. Since a building right grants it's holder a right to own buildings erected on a parcel belonging to another party, the establishment of a building right results in a horizontal division between the ownership right of the land on one hand and the ownership right of the buildings on the other hand.
For the duration of its right, the holder of a building right is the sole owner of the buildings he erected; he may enjoy, use or demolish them provided that he returns the land in the condition in which he received it.
Special attention must be drawn to the maximum duration of fifty years, although this right is renewable.
Vesting a building right above or under the land belonging to another party
The modification of the Building Right Act expands the scope of this Act by explicitly stating that a building right can also be vested above or under the land belonging to another party. Originally, a building right could only be vested with regard to a construction on the land belonging to another party.
An illustration may clarify this modification: a landowner can not only grant an ownership right to another person with regard to a building on his land, but could also grant an ownership right to another person with regard to a subterranean parking under his parcel. A building right could for example also be vested in order to grant the holder of a building right the right to install a pipeline under land belonging to another party.
A landowner may also grant a building right in order to install solar panels on his building. The person who installs these panels on the basis of a building right will remain the owner of these panels for the duration of his right. Also, an association of co-owners of an apartment building may grant a right to erect an additional floor on top of the already existing apartment building.
Not only the landowner can vest a building right
Another important modification of the Building Right Act, is the fact that a building right does not necessarily have to be vested by the landowner. The Act explicitly states that a building right can also be vested by a holder of a limited right in rem. For example, a usufructuary, the holder of a long lease right ("erfpachtrecht" / "droit d'emphytéose") or building right, could grant a building right.
Parties must however bear in mind that they can never grant more rights than they hold themselves (nemo plus iurus principle). The building right which is established by a holder of a limited real right will therefore automatically terminate when the limited real right of the person who granted the building right is terminated. Also, the limitations regarding the capacity of the holder of a limited real right should be kept in mind. A usufructuary for example may not change the destination of the goods which are subject to his right. Therefore he must also impose this obligation on the person to whom he grants the building right.
The Building Right Act only mentions the landowner and holders of a limited right in rem as persons qualified to vest a building right. However, the possibility to grant a building right should not be limited to these categories. The holder of a concession or a lease can also establish a building right. Whenever a holder of a concession or a lease has the right to build on the ground which is subject to the concession or lease agreement, the holder of this right, will by virtue of an "accessory" building right ("accessoir opstalrecht" / "droit de superficie consequence") become the owner of the buildings he erects on this land. This ownership right with regard to the buildings he erects grants him the right to vest a building right on or above these buildings (unless the parties conventionally excluded this possibility). Also in this case it is important to bear in mind that this building right will automatically expire whenever the ‘first' (limited) right (in rem) expires.
When the building right expires, accession in favor of the landowner will occur. The landowner will automatically become the owner of the building erected by the holder of the (limited) right (in rem).
Again, an illustration may clarify this: when a holder of a long lease right builds on land belonging to another party, he will become the owner of this building on the basis of an accessory building right. He may sell or lease this building, and he may mortgage it, provided that this sale, lease or mortgage will expire when the long lease right expires. This accessory building right not only grants him the right to dispose of the building, but also makes it possible to establish a building right on top of the building(s) he erected. Also, a holder of long lease right may for example grant a building right to a person who will install solar panels. As said above, once the long lease right is terminated, the building right with regard to these solar panels will also terminate and accession will take place in favor of the land owner, who will automatically become owner of both the building and the solar panels.
Will the constructions be compensated?
The question arises whether the landowner should pay for the constructions erected on his land once accession takes place. In principle, this is indeed the case when a building right expires. At the expiry of his right, the holder of the building right is entitled to claim recompense for the actual value of the buildings, works or crops he erected (Article 6 of the Building Right Act). This situation is different from long lease rights: in principle, no recompense is due from the landowner for constructions which were erected by the holder of the long lease right (Article 8 of the Long Lease Act). However, neither provision is mandatory, so parties are free to exclude any recompense or to agree on a certain amount to be paid.
Conclusion
The modification of the Building Right Act should be applauded. A building right can now not only be vested with regard to constructions on land belonging to another party, but also under and above land belonging to another party. A building right can furthermore not only be vested by the landowner but also by other holders of a limited right in rem.
However, parties must keep in mind that a building right is always limited to fifty years. After fifty years, the landowner will automatically become owner of the constructions erected by the holder of a building right. The new possibilities which were created by the modification of the Building Right Act do not alter the fact that this time limitation could still hinder real estate practice.
