SLOVENIA Law and Practice Contributed by: Blaž Ogorevc, Miha Štravs and Blaž Murko, Odvetniki Šelih & partnerji, o.p., d.o.o.
• an entry in the land register. The decision on the transfer of title is made by the land register court based on the above docu - mentation. Based on the court’s decision, the land register records each transfer of title in real estate. Entry in the land register is a constitutive element in the process transfer of title. Each piece of real estate in Slovenia is registered in the land register, which shows the exact own - er of the property as well as any encumbrances registered over the property. The land register is kept electronically and is publicly accessible. Both actual and historic data are available. The Land Register Act prescribes the principle of reli - ance on the land register data, which means that anyone who acts honestly in legal transactions and relies on the information entered in the land register should not suffer adverse consequences as a result. Considering the above, title insur - ance is not commonly used in daily transactions. In large transactions, however, buyers may elect to use title insurance to cover transaction-spe - cific risks identified during the due diligence (for example, part of the building being built on for - eign land, etc). 2.4 Real Estate Due Diligence The aim of real estate due diligence is to thor - oughly inspect the real estate in order to reduce the risks involved with the purchase and to miti - gate uncertainties. Besides legal due diligence, acquisition of real estate frequently also requires performance of technical or environmental due diligence. The manner and scope by which buyers carry out real estate due diligence depends heavily on the objectives of the transaction. On the one hand, the acquisition of an income-producing property like a shopping centre requires the
buyer to examine existing lease agreements and each tenant’s rental payment history. On the other hand, the acquisition of a greenfield property intended for real estate development requires the buyer to closely examine the zoning regulations. Regardless, due diligence always involves a review of public records (land register, land cadastre, etc). A due diligence activity specific to the acquisi - tion of real estate in Slovenia is the examination of potential ongoing restitution proceedings, which is a legacy of the former collective own - ership system. 2.5 Typical Representations and Warranties The scope of representations and warranties in commercial real estate transactions depends on the characteristics of each individual transac - tion. Nevertheless, representations and warran - ties may include the following: • parties’ confirmation of authority to enter into the agreement; • seller’s confirmation that there are no title defects or rights of third persons; • seller’s confirmation that there are no unpaid taxes related to the real estate; • seller’s confirmation that there are no pending litigation, expropriation and restitution pro - ceedings related to the real estate; and • seller’s confirmation that there is no environ - mental contamination. Certain seller’s warranties, however, are also provided under statute, in particular in the Obli - gations Code and in the Protection of Buyers of Apartments and Single Occupancy Buildings Act that applies to the purchase of new con - structions with the buyer being a consumer and
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