ANDORRA Law and Practice Contributed by: Elena Redondo, Albert Hinojosa and Marc Ambrós, Cases & Lacambra
would have specific regulations, but the theory of the title and mode would apply to any sector. 2.3 Effecting Lawful and Proper Transfer of Title The lawful and proper transfer of title to real estate occurs when the conclusion of an agreement and the subsequent delivery of the real estate has been made before a public notary. There is no land registry in Andorra, but each town hall has its own real estate registry for tax purposes. The transfer of title is recorded in the Andorran cham - ber of notaries. The public notaries record all the public deeds granted in reference to a real estate, including the encumbrances, modifications and other duly recorded vicissitudes of the real estate. Title insurance is not used in Andorra. 2.4 Real Estate Due Diligence Buyers usually carry out due diligence on a real estate property, undertaking an exhaustive investigation of the ownership and main charac - teristics of the real estate. The red flag aspects • the rights of third parties over the real estate, eg, if there are lease rights, if they are sub - ject to a specific licence, if the real estate is subject to any tax, or if there is some kind of foreclosure on the real estate; • whether there is any debt involved in the case of condominiums; and • whether there are any litigious procedures concerning the real estate. 2.5 Typical Representations and Warranties The parties negotiate the representation and warranties within a commercial real estate trans - action. The typical representations and warran - ties in Andorra are as follows: to analyse are the following: • titles and encumbrances;
• the buyer must obtain authorisation for any foreign investment from the Andorran govern - ment before the completion of the transac - tion; • at the time of granting the public deed of sale, the property must comply with the conditions for building on the land, being free of charges, encumbrances, tenants and occupants; • the property must be transmitted with all the rights, facilities, elements and equipment that are inherent and accessory to it; • the seller shall carry out all the necessary or agreed acts to avoid the occupation of the property by third parties so that it is free; and • although, from a legal standpoint, an environ - mental contingency certificate is not request - ed, it is highly recommended. The buyer’s remedies against the seller for misrepresentation include the resolution of the agreement, with the return of any reciprocal benefits, the compensation of damages to the buyer, or the specific performance of the terms and conditions of the agreement. Depending on the relevance of the transaction, it is customary for the seller’s representations and warranties to expire after a certain amount of time. The typical range of that survival period is usually between two to four years. On the other hand, there is usually a cap on the seller’s liability for a breach of its representa - tions and warranties, the typical range of that cap being from a limited percentage of the price to the full price. 2.6 Important Areas of Law for Investors The most important areas of law for an investor to consider when purchasing real estate could be:
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