new law requiring approval from defense ministry to buy land/apartment

mshamber · Post by **mshamber** » Thu Oct 31, 2019 9:24 am

I read yesterday in yle about the new law requiring foreigners to get permission from the ministry of defense to buy property.

https://yle.fi/uutiset/osasto/news/perm ... 0/11043532

Being an American I have an issue with this. If I would have had to wait 3 months to get approval for purchasing past apartments it would have killed the deal. Desirable apartments usually have more then one bidder and it is unlikely the owner would wait for the approval if they can get there money sooner.

I don't see how this law is going to affect Russian purchase of strategic land in Finland. They only need to form a limited company in any EU country to get around it.

The Finnish constitution guarantees the right to equal treatment. The European Articles of Incorporation also guarantees the right to equal treatment which extends to family members regardless of nationality.

I think the easiest way to make a challenge would be to refer Finland to the commission and hope they take it up. It only inconveniences foreigners in Finland and is not effective to stop the actual issue it attempts to solve.

Anyone see how this new law could hold up to challenge?

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Upphew · Post by **Upphew** » Thu Oct 31, 2019 9:39 am

mshamber wrote: ↑
Thu Oct 31, 2019 9:24 am
I don't see how this law is going to affect Russian purchase of strategic land in Finland. They only need to form a limited company in any EU country to get around it.

And have under 10% of the stock owned by non EEA, they wouldn't have majority in their own company.

mshamber · Post by **mshamber** » Thu Oct 31, 2019 10:04 am

Can you give a link to the 10% rule?

Let's take Finland as an example country. A foreign national can be 100% shareholder in a limited company and if they are resident in the EEA then no special permission is needed from PRH to be board member or director.

From
https://www.prh.fi/en/kaupparekisteri/u ... luvat.html:

Question: Can a foreigner be a shareholder / board member / managing director (housing manager) in a limited liability company?
Answer: The citizenship of the person is not a decisive factor. What is relevant is in which country he or she lives permanently. In certain cases a person residing outside the European Economic Area (EEA) needs a permit from the PRH.

Shareholder
In regular businesses there are no restrictions based on the place of residence or registered office, or citizenship, when it comes to the right to own shares. There are, however, some rare special situations which are governed by the Act on the Monitoring of Foreigners’ Corporate Acquisitions in Finland.

rinso · Post by **rinso** » Thu Oct 31, 2019 11:17 am

I think that most (non-professional) sellers will avoid bids from an unclear origin (shareholder, non-EU foreigner) if they have a competitive bid. So yes, even if there are no restrictions in the law, you'll be at a disadvantage.

deepsudeep · Post by **deepsudeep** » Thu Oct 31, 2019 12:26 pm

BOOOO to the law

Upphew · Post by **Upphew** » Thu Oct 31, 2019 12:40 pm

mshamber wrote: ↑
Thu Oct 31, 2019 10:04 am
Can you give a link to the 10% rule?

https://www.finlex.fi/fi/laki/alkup/2019/20190470

Upphew · Post by **Upphew** » Thu Oct 31, 2019 1:05 pm

mshamber wrote: ↑
Thu Oct 31, 2019 9:24 am
It only inconveniences foreigners in Finland and is not effective to stop the actual issue it attempts to solve.

I think this law originates from people who would like have bought back their family lands from Russia... if they had allowed that. Their border zone that is out of limits to foreign land ownership is something like 100km from the border.

mshamber · Post by **mshamber** » Thu Oct 31, 2019 1:23 pm

Thank you for the link. After reading the law it is not as bad as the yle article makes it out to be.

The yle article states that for joint ownership if one of the members is foreign they need permission which is true except if they are married/cohabitating with a EEA citizen where no permission is required.

Also, you can purchase the property and make the application to the defense ministry within 2 months so you are not at a disadvantage in negotiations. There is a chance you could be forced to sell the property later if your request is denied.

nimap · Post by **nimap** » Fri Nov 01, 2019 10:16 pm

deepsudeep wrote: ↑
Thu Oct 31, 2019 12:26 pm
BOOOO to the law

Boo indeed, wasn't that Finnish national who bought the lands in strategic areas for his Russian clients? not sure how is this suppose to stop that. Just pain in the butt for normal residents and more bureaucracy to deal with.

agroot · Post by **agroot** » Sun Nov 03, 2019 1:41 pm

Is this going to affect every non-citizens or just those without permanent residence permit?

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