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Mainstreaming the First Registration of Real Property Rights in Romania Camille Bourguignon The World Bank Europe & Central Asia (ECA) Region 2014 Land.

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Presentation on theme: "Mainstreaming the First Registration of Real Property Rights in Romania Camille Bourguignon The World Bank Europe & Central Asia (ECA) Region 2014 Land."— Presentation transcript:

1 Mainstreaming the First Registration of Real Property Rights in Romania Camille Bourguignon The World Bank Europe & Central Asia (ECA) Region 2014 Land and Poverty Conference The World Bank, Washington, DC March 24-27, 2014

2  Romania’s New Land Book System: Origins and Rationale  Limits of the New Land Book System: Efficient but not Accessible to All  Issues in First Registration: Costs and Proofs of Ownership  Current solution to broaden coverage: Systematic registration  Conclusions: Toward more inclusive registration services Outline

3 Romania’s New Land Books Romania’s real property rights registration system Legal basis established in 1996 (Law No.7) and implementation began in 1999 Real property rights data administration system (eTerra) piloted in 2006 and rolled out in 2009 Progressively replace the “old” registration systems Old land book system System of records transcription-inscription Objectives behind the introduction of the New Land Books: Support the transition to market economy Put an end to the property rights confusion (e.g. old systems in disuse, collectivization, and restitution) Introduce the principles of modern land administration (e.g. integrated registry/cadastre, and parcel based)

4 Romania’s New Land Books An important step in the establishment of an efficient property registration system in Romania Doing Business Improvements in property rights are not specific to Romania, but are common throughout the former Soviet Bloc Procedures Time Cost DB Ranking

5 Limitations of the New Land Books Doing Business looks at very specific cases Expensive property: worth 50 times the country’s income per capita One type of property right: generally full property rights One type of transaction: sale and purchase agreement Doing Business does not look at first registration, which involves specific steps to identify and demarcate properties, and to prove the legality of the ownership claim. In Romania, first registration is mostly done sporadically So far, 6 million properties, a mere 15 percent, have been registered in eTerra 32 million properties (85 percent) are not registered Improving the Doing Business rank is important, but not enough to make the New Land Books more inclusive

6 First Registration Issues A typical restituted property: 0.5ha of agricultural land (RON 6000) Typical owners: Restitution beneficiary, heir, and buyer First registration of a 0.5 ha agriculture plot worth RON 6,000 Cost for registering a typical restituted plot:17 to 24 percent of the land value Restitution beneficiaries have on average 4 to 5 plots Total cost for 5 parcels: At least 6 minimum salaries or 18 pensions (elderly farmer) Who?SurveyorNotaryTaxes Regis. feeTotal cost Total cost (% prop.) Restitution Beneficiary 1000N.A Heir of Owner Buyer from Owner

7 First Registration Issues Prohibitive cost of surveying properties Inaccuracies or mistakes in the 9m restitution titles Overlapping boundaries with registered parcels Lack of notarized inheritance certificate Lack of notarized sale & purchase agreement Failure to pay the transfer tax Complete lack of title deeds A central issue for Roma communities Romania has the largest Roma population in Europe

8 Systematic Registration Rationale for systematic registration: Equity and efficiency reasons (Binswanger et al. 1993). Romania: suppression of surveying costs Piloted under the CESAR project since 2007 (50 out of 3,114 territorial administrative units) Romania intends to scale up systematic registration in 1,000 territorial administrative units A unique opportunity to quickly extend the coverage of registration services, but: There is still a need for mainstreaming sporadic registration Many individuals need help to produce proof of ownership C ontroversies around Roma property rights have to be addressed A work in progress Systematic & sporadic registration strategy is being prepared Poverty & Social Impact Assessment will be carry out Agreeing on key principles & designing guidelines

9 Conclusions The establishment of Romania’s New Land Book System has been a key step in the transition to market economy The impact of this System on Romania’s Investment climate is visible in the Doing Business reports, but this system needs to become more inclusive Systematic Registration can quickly extend registration services coverage, but measures are required to ensure that the poor do benefit In Romania, there is a strong need to address controversies around the property rights of the largest Roma population in Europe


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