i Table of contents 1372

Real Estate 2025

Definitive global law guides offering comparative analysis from top-ranked lawyers

INTRODUCTION		7
Contributed by John Sullivan and Matt Alshouse, DLA Piper LLP		7
ANDORRA		13
Law and Practice		13
Contributed by Cases & Lacambra		13
ANGUILLA		39
Law and Practice		39
Contributed by Webster LP		39
Trends and Developments		55
Contributed by Webster LP		55
AUSTRIA		59
Law and Practice		59
Contributed by Urbanek Law		59
Trends and Developments		85
Contributed by Urbanek Law		85
BAHAMAS		94
Law and Practice		94
Contributed by Graham Thompson		94
BELGIUM		119
Law and Practice		119
Contributed by Linklaters		119
Trends and Developments		149
Contributed by Linklaters		149
BERMUDA		158
Law and Practice		158
Contributed by Wakefield Quin Limited		158
BRAZIL		184
Law and Practice		184
Contributed by Malta Advogados		184
Trends and Developments		212
Contributed by Campos Mello Advogados		212
CANADA		218
Law and Practice		218
Contributed by Stikeman Elliott LLP		218
CANADA – QUEBEC		245
Trends and Developments		245
Contributed by BCF LLP		245
CAYMAN ISLANDS		252
Law and Practice		252
Contributed by Appleby		252
CHINA		275
Law and Practice		275
Contributed by JunHe LLP		275
Trends and Developments		301
Contributed by Merits & Tree Law Offices		301
CYPRUS		308
Trends and Developments		308
Contributed by George K. Konstantinou Law Firm		308
DOMINICAN REPUBLIC		314
Law and Practice		314
Contributed by Guzmán Ariza		314
Trends and Developments		337
Contributed by DHOZ Abogados		337
GERMANY		343
Law and Practice		343
Contributed by Linklaters		343
Trends and Developments		368
Contributed by Latham & Watkins		368
GREECE		374
Law and Practice		374
Contributed by Machas & Partners		374
Trends and Developments		400
Contributed by Lamnidis Law		400
HUNGARY		409
Law and Practice		409
Contributed by Lakatos, Köves & Partners		409
INDIA		433
Law and Practice		433
Contributed by JSA		433
Trends and Developments		458
Contributed by JSA		458
IRELAND		464
Law and Practice		464
Contributed by Maples Group		464
Trends and Developments		490
Contributed by Maples Group		490
ITALY		497
Law and Practice		497
Contributed by SI – Studio Inzaghi		497
Trends and Developments		523
Contributed by Legance		523
JAPAN		529
Law and Practice		529
Contributed by Mori Hamada & Matsumoto		529
Trends and Developments		553
Contributed by Nishimura & Asahi (Gaikokuho Kyodo Jigyo)		553
KENYA		560
Law and Practice		560
Contributed by DLA Piper Africa, Kenya (IKM Advocates)		560
LITHUANIA		589
Law and Practice		589
Contributed by WALLESS		589
LUXEMBOURG		610
Law and Practice		610
Contributed by Stibbe		610
Trends and Developments		636
Contributed by Norton Rose Fulbright		636
MALAYSIA		642
Law and Practice		642
Contributed by Ooi & Ooi		642
MEXICO		667
Law and Practice		667
Contributed by Cannizzo		667
Trends and Developments		693
Contributed by Ritch Mueller		693
MOROCCO		701
Law and Practice		701
Contributed by Gide Loyrette Nouel		701
NETHERLANDS		727
Law and Practice		727
Contributed by Greenberg Traurig, LLP		727
Trends and Developments		751
Contributed by Greenberg Traurig, LLP		751
POLAND		758
Law and Practice		758
Contributed by act legal Poland		758
PORTUGAL		783
Law and Practice		783
Contributed by CS’Associados		783
Trends and Developments		807
Contributed by PLMJ		807
PUERTO RICO		814
Law and Practice		814
Contributed by Pietrantoni Mendez & Alvarez LLC		814
ROMANIA		835
Law and Practice		835
Contributed by Mușat & Asociații		835
SINGAPORE		861
Law and Practice		861
Contributed by WongPartnership LLP		861
Trends and Developments		886
Contributed by WongPartnership		886
SLOVENIA		893
Law and Practice		893
Contributed by Odvetniki Šelih & partnerji, o.p., d.o.o.		893
Trends and Developments		919
Contributed by Odvetniki Šelih & partnerji, o.p., d.o.o.		919
SOUTH KOREA		927
Law and Practice		927
Contributed by Bae, Kim & Lee LLC		927
ST KITTS & NEVIS		953
Law and Practice		953
Contributed by Joseph Rowe, Attorneys-at-Law		953
SWITZERLAND		978
Law and Practice		978
Contributed by Walder Wyss Ltd		978
THAILAND		998
Law and Practice		998
Contributed by Duensing Kippen, Ltd.		998
TÜRKIYE		1023
Law and Practice		1023
Contributed by Hergüner Bilgen Üçer Attorney Partnership		1023
TURKS & CAICOS		1048
Law and Practice		1048
Contributed by Griffiths & Partners Attorneys		1048
Trends and Developments		1065
Contributed by Griffiths & Partners Attorneys		1065
UAE		1068
Law and Practice		1068
Contributed by DLA Piper Middle East LLP		1068
USA		1093
Law and Practice		1093
Contributed by Rosen Karol Salis PLLC		1093
USA – ALABAMA		1121
Law and Practice		1121
Contributed by Dentons		1121
Trends and Developments		1147
Contributed by Dentons		1147
USA – IOWA		1156
Law and Practice		1156
Contributed by Dentons Davis Brown PC		1156
Trends and Developments		1181
Contributed by Dentons Davis Brown PC		1181
USA – LOUISIANA		1189
Law and Practice		1189
Contributed by Jones Walker LLP		1189
Trends and Developments		1217
Contributed by Jones Walker LLP		1217
USA – NEW JERSEY		1225
Law and Practice		1225
Contributed by Greenberg Traurig LLP		1225
USA – NEW YORK		1250
Law and Practice		1250
Contributed by Phillips Lytle LLP		1250
Trends and Developments		1274
Contributed by Phillips Lytle LLP		1274
USA – NORTH CAROLINA		1280
Law and Practice		1280
Contributed by Kilpatrick		1280
USA – SOUTH CAROLINA		1302
Law and Practice		1302
Contributed by K&L Gates		1302
USA – TEXAS		1326
Law and Practice		1326
Contributed by Cokinos | Young		1326
VIETNAM		1350
Law and Practice		1350
Contributed by LNT & Partners		1350
1. General		18
1.1 Main Sources of Law		18
1.2 Main Market Trends and Deals		18
1.3 Proposals for Reform		19
2. Sale and Purchase		19
2.1 Categories of Property Rights		19
2.2 Laws Applicable to Transfer of Title		19
2.3 Effecting Lawful and Proper Transfer of Title		20
2.4 Real Estate Due Diligence		20
2.5 Typical Representations and Warranties		20
2.6 Important Areas of Law for Investors		21
2.7 Soil Pollution or Environmental Contamination		21
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		21
2.9 Condemnation, Expropriation or Compulsory Purchase		21
2.10 Taxes Applicable to a Transaction		22
2.11 Legal Restrictions on Foreign Investors		22
3. Real Estate Finance		23
3.1 Financing Acquisitions of Commercial Real Estate		23
3.2 Typical Security Created by Commercial Investors		23
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		24
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		24
3.5 Legal Requirements Before an Entity Can Give Valid Security		24
3.6 Formalities When a Borrower Is in Default		25
3.7 Subordinating Existing Debt to Newly Created Debt		25
3.8 Lenders’ Liability Under Environmental Laws		25
3.9 Effects of a Borrower Becoming Insolvent		25
3.10 Taxes on Loans		26
4. Planning and Zoning		26
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		26
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		26
4.3 Regulatory Authorities		26
4.4 Obtaining Entitlements to Develop a New Project		27
4.5 Right of Appeal Against an Authority’s Decision		27
4.6 Agreements With Local or Governmental Authorities		27
4.7 Enforcement of Restrictions on Development and Designated Use		27
5. Investment Vehicles		28
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		28
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		28
5.3 REITs		29
5.4 Minimum Capital Requirement		29
5.5 Applicable Governance Requirements		29
5.6 Annual Entity Maintenance and Accounting Compliance		30
6. Commercial Leases		30
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		30
6.2 Types of Commercial Leases		30
6.3 Regulation of Rents or Lease Terms		31
6.4 Typical Terms of a Lease		31
6.5 Rent Variation		31
6.6 Determination of New Rent		31
6.7 Payment of VAT		31
6.8 Costs Payable by a Tenant at the Start of a Lease		32
6.9 Payment of Maintenance and Repair		32
6.10 Payment of Utilities and Telecommunications		32
6.11 Payment of Property Taxes		32
6.12 Insurance Issues		33
6.13 Restrictions on the Use of Real Estate		33
6.14 Tenant’s Ability to Alter and Improve Real Estate		33
6.15 Specific Regulations		33
6.16 Effect of the Tenant’s Insolvency		34
6.17 Right to Occupy After Termination or Expiry of a Lease		34
6.18 Right to Assign a Leasehold Interest		34
6.19 Right to Terminate a Lease		34
6.20 Registration Requirements		35
6.21 Forced Eviction		35
6.22 Termination by a Third Party		35
6.23 Remedies/Damages for Breach		35
7. Construction		35
7.1 Common Structures Used to Price Construction Projects		35
7.2 Assigning Responsibility for the Design and Construction of a Project		36
7.3 Management of Construction Risk		36
7.4 Management of Schedule-Related Risk		36
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		36
7.6 Liens or Encumbrances in the Event of Non-Payment		36
7.7 Requirements Before Use or Inhabitation		37
8. Tax		37
8.1 VAT and Sales Tax		37
8.2 Mitigation of Tax Liability		37
8.3 Municipal Taxes		37
8.4 Income Tax Withholding for Foreign Investors		37
8.5 Tax Benefits		37
1. General		43
1.1 Main Sources of Law		43
1.2 Main Market Trends and Deals		43
1.3 Proposals for Reform		43
2. Sale and Purchase		43
2.1 Categories of Property Rights		43
2.2 Laws Applicable to Transfer of Title		43
2.3 Effecting Lawful and Proper Transfer of Title		43
2.4 Real Estate Due Diligence		44
2.5 Typical Representations and Warranties		44
2.6 Important Areas of Law for Investors		44
2.7 Soil Pollution or Environmental Contamination		45
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		45
2.9 Condemnation, Expropriation or Compulsory Purchase		45
2.10 Taxes Applicable to a Transaction		46
2.11 Legal Restrictions on Foreign Investors		46
3. Real Estate Finance		46
3.1 Financing Acquisitions of Commercial Real Estate		46
3.2 Typical Security Created by Commercial Investors		46
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		47
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		47
3.5 Legal Requirements Before an Entity Can Give Valid Security		47
3.6 Formalities When a Borrower Is in Default		47
3.7 Subordinating Existing Debt to Newly Created Debt		47
3.8 Lenders’ Liability Under Environmental Laws		47
3.9 Effects of a Borrower Becoming Insolvent		47
3.10 Taxes on Loans		47
4. Planning and Zoning		48
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		48
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		48
4.3 Regulatory Authorities		48
4.4 Obtaining Entitlements to Develop a New Project		48
4.5 Right of Appeal Against an Authority’s Decision		48
4.6 Agreements With Local or Governmental Authorities		48
4.7 Enforcement of Restrictions on Development and Designated Use		49
5. Investment Vehicles		49
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		49
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		49
5.3 REITs		49
5.4 Minimum Capital Requirement		49
5.5 Applicable Governance Requirements		49
5.6 Annual Entity Maintenance and Accounting Compliance		49
6. Commercial Leases		49
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		49
6.2 Types of Commercial Leases		49
6.3 Regulation of Rents or Lease Terms		50
6.4 Typical Terms of a Lease		50
6.5 Rent Variation		50
6.6 Determination of New Rent		50
6.7 Payment of VAT		50
6.8 Costs Payable by a Tenant at the Start of a Lease		50
6.9 Payment of Maintenance and Repair		50
6.10 Payment of Utilities and Telecommunications		50
6.11 Payment of Property Taxes		50
6.12 Insurance Issues		51
6.13 Restrictions on the Use of Real Estate		51
6.14 Tenant’s Ability to Alter and Improve Real Estate		51
6.15 Specific Regulations		51
6.16 Effect of the Tenant’s Insolvency		51
6.17 Right to Occupy After Termination or Expiry of a Lease		51
6.18 Right to Assign a Leasehold Interest		51
6.19 Right to Terminate a Lease		51
6.20 Registration Requirements		52
6.21 Forced Eviction		52
6.22 Termination by a Third Party		52
6.23 Remedies/Damages for Breach		52
7. Construction		52
7.1 Common Structures Used to Price Construction Projects		52
7.2 Assigning Responsibility for the Design and Construction of a Project		52
7.3 Management of Construction Risk		52
7.4 Management of Schedule-Related Risk		53
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		53
7.6 Liens or Encumbrances in the Event of Non-Payment		53
7.7 Requirements Before Use or Inhabitation		53
8. Tax		53
8.1 VAT and Sales Tax		53
8.2 Mitigation of Tax Liability		53
8.3 Municipal Taxes		53
8.4 Income Tax Withholding for Foreign Investors		53
8.5 Tax Benefits		54
1. General		64
1.1 Main Sources of Law		64
1.2 Main Market Trends and Deals		64
1.3 Proposals for Reform		65
2. Sale and Purchase		65
2.1 Categories of Property Rights		65
2.2 Laws Applicable to Transfer of Title		66
2.3 Effecting Lawful and Proper Transfer of Title		66
2.4 Real Estate Due Diligence		66
2.5 Typical Representations and Warranties		66
2.6 Important Areas of Law for Investors		68
2.7 Soil Pollution or Environmental Contamination		68
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		69
2.9 Condemnation, Expropriation or Compulsory Purchase		69
2.10 Taxes Applicable to a Transaction		69
2.11 Legal Restrictions on Foreign Investors		69
3. Real Estate Finance		70
3.1 Financing Acquisitions of Commercial Real Estate		70
3.2 Typical Security Created by Commercial Investors		70
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		70
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		70
3.5 Legal Requirements Before an Entity Can Give Valid Security		71
3.6 Formalities When a Borrower Is in Default		71
3.7 Subordinating Existing Debt to Newly Created Debt		71
3.8 Lenders’ Liability Under Environmental Laws		72
3.9 Effects of a Borrower Becoming Insolvent		72
3.10 Taxes on Loans		72
4. Planning and Zoning		72
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		72
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		73
4.3 Regulatory Authorities		73
4.4 Obtaining Entitlements to Develop a New Project		73
4.5 Right of Appeal Against an Authority’s Decision		73
4.6 Agreements With Local or Governmental Authorities		74
4.7 Enforcement of Restrictions on Development and Designated Use		74
5. Investment Vehicles		74
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		74
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		74
5.3 REITs		75
5.4 Minimum Capital Requirement		75
5.5 Applicable Governance Requirements		75
5.6 Annual Entity Maintenance and Accounting Compliance		75
6. Commercial Leases		76
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		76
6.2 Types of Commercial Leases		76
6.3 Regulation of Rents or Lease Terms		76
6.4 Typical Terms of a Lease		76
6.5 Rent Variation		76
6.6 Determination of New Rent		77
6.7 Payment of VAT		77
6.8 Costs Payable by a Tenant at the Start of a Lease		77
6.9 Payment of Maintenance and Repair		77
6.10 Payment of Utilities and Telecommunications		77
6.11 Payment of Property Taxes		78
6.12 Insurance Issues		78
6.13 Restrictions on the Use of Real Estate		78
6.14 Tenant’s Ability to Alter and Improve Real Estate		78
6.15 Specific Regulations		79
6.16 Effect of the Tenant’s Insolvency		79
6.17 Right to Occupy After Termination or Expiry of a Lease		79
6.18 Right to Assign a Leasehold Interest		79
6.19 Right to Terminate a Lease		80
6.20 Registration Requirements		80
6.21 Forced Eviction		80
6.22 Termination by a Third Party		80
6.23 Remedies/Damages for Breach		80
7. Construction		81
7.1 Common Structures Used to Price Construction Projects		81
7.2 Assigning Responsibility for the Design and Construction of a Project		81
7.3 Management of Construction Risk		81
7.4 Management of Schedule-Related Risk		82
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		82
7.6 Liens or Encumbrances in the Event of Non-Payment		82
7.7 Requirements Before Use or Inhabitation		82
8. Tax		82
8.1 VAT and Sales Tax		82
8.2 Mitigation of Tax Liability		83
8.3 Municipal Taxes		83
8.4 Income Tax Withholding for Foreign Investors		83
8.5 Tax Benefits		83
1. General		98
1.1 Main Sources of Law		98
1.2 Main Market Trends and Deals		98
1.3 Proposals for Reform		99
2. Sale and Purchase		99
2.1 Categories of Property Rights		99
2.2 Laws Applicable to Transfer of Title		99
2.3 Effecting Lawful and Proper Transfer of Title		99
2.4 Real Estate Due Diligence		100
2.5 Typical Representations and Warranties		100
2.6 Important Areas of Law for Investors		101
2.7 Soil Pollution or Environmental Contamination		101
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		102
2.9 Condemnation, Expropriation or Compulsory Purchase		102
2.10 Taxes Applicable to a Transaction		103
2.11 Legal Restrictions on Foreign Investors		103
3. Real Estate Finance		104
3.1 Financing Acquisitions of Commercial Real Estate		104
3.2 Typical Security Created by Commercial Investors		105
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		105
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		106
3.5 Legal Requirements Before an Entity Can Give Valid Security		106
3.6 Formalities When a Borrower Is in Default		106
3.7 Subordinating Existing Debt to Newly Created Debt		107
3.8 Lenders’ Liability Under Environmental Laws		107
3.9 Effects of a Borrower Becoming Insolvent		107
3.10 Taxes on Loans		107
4. Planning and Zoning		107
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		107
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		109
4.3 Regulatory Authorities		109
4.4 Obtaining Entitlements to Develop a New Project		109
4.5 Right of Appeal Against an Authority’s Decision		110
4.6 Agreements With Local or Governmental Authorities		110
4.7 Enforcement of Restrictions on Development and Designated Use		110
5. Investment Vehicles		111
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		111
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		111
5.3 REITs		111
5.4 Minimum Capital Requirement		112
5.5 Applicable Governance Requirements		112
5.6 Annual Entity Maintenance and Accounting Compliance		112
6. Commercial Leases		112
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		112
6.2 Types of Commercial Leases		113
6.3 Regulation of Rents or Lease Terms		113
6.4 Typical Terms of a Lease		113
6.5 Rent Variation		113
6.6 Determination of New Rent		113
6.7 Payment of VAT		113
6.8 Costs Payable by a Tenant at the Start of a Lease		114
6.9 Payment of Maintenance and Repair		114
6.10 Payment of Utilities and Telecommunications		114
6.11 Payment of Property Taxes		114
6.12 Insurance Issues		114
6.13 Restrictions on the Use of Real Estate		114
6.14 Tenant’s Ability to Alter and Improve Real Estate		115
6.15 Specific Regulations		115
6.16 Effect of the Tenant’s Insolvency		115
6.17 Right to Occupy After Termination or Expiry of a Lease		115
6.18 Right to Assign a Leasehold Interest		115
6.19 Right to Terminate a Lease		115
6.20 Registration Requirements		116
6.21 Forced Eviction		116
6.22 Termination by a Third Party		116
6.23 Remedies/Damages for Breach		116
7. Construction		116
7.1 Common Structures Used to Price Construction Projects		116
7.2 Assigning Responsibility for the Design and Construction of a Project		117
7.3 Management of Construction Risk		117
7.4 Management of Schedule-Related Risk		117
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		117
7.6 Liens or Encumbrances in the Event of Non-Payment		117
7.7 Requirements Before Use or Inhabitation		117
8. Tax		117
8.1 VAT and Sales Tax		117
8.2 Mitigation of Tax Liability		118
8.3 Municipal Taxes		118
8.4 Income Tax Withholding for Foreign Investors		118
8.5 Tax Benefits		118
1. General		124
1.1 Main Sources of Law		124
1.2 Main Market Trends and Deals		124
1.3 Proposals for Reform		125
2. Sale and Purchase		125
2.1 Categories of Property Rights		125
2.2 Laws Applicable to Transfer of Title		126
2.3 Effecting Lawful and Proper Transfer of Title		126
2.4 Real Estate Due Diligence		126
2.5 Typical Representations and Warranties		127
2.6 Important Areas of Law for Investors		128
2.7 Soil Pollution or Environmental Contamination		128
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		129
2.9 Condemnation, Expropriation or Compulsory Purchase		129
2.10 Taxes Applicable to a Transaction		129
2.11 Legal Restrictions on Foreign Investors		130
3. Real Estate Finance		130
3.1 Financing Acquisitions of Commercial Real Estate		130
3.2 Typical Security Created by Commercial Investors		131
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		131
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		131
3.5 Legal Requirements Before an Entity Can Give Valid Security		131
3.6 Formalities When a Borrower Is in Default		131
3.7 Subordinating Existing Debt to Newly Created Debt		132
3.8 Lenders’ Liability Under Environmental Laws		132
3.9 Effects of a Borrower Becoming Insolvent		132
3.10 Taxes on Loans		132
4. Planning and Zoning		133
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		133
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		133
4.3 Regulatory Authorities		133
4.4 Obtaining Entitlements to Develop a New Project		133
4.5 Right of Appeal Against an Authority’s Decision		134
4.6 Agreements With Local or Governmental Authorities		134
4.7 Enforcement of Restrictions on Development and Designated Use		134
5. Investment Vehicles		134
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		134
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		135
5.3 REITs		136
5.4 Minimum Capital Requirement		136
5.5 Applicable Governance Requirements		137
5.6 Annual Entity Maintenance and Accounting Compliance		137
6. Commercial Leases		138
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		138
6.2 Types of Commercial Leases		138
6.3 Regulation of Rents or Lease Terms		138
6.4 Typical Terms of a Lease		138
6.5 Rent Variation		139
6.6 Determination of New Rent		139
6.7 Payment of VAT		139
6.8 Costs Payable by a Tenant at the Start of a Lease		140
6.9 Payment of Maintenance and Repair		140
6.10 Payment of Utilities and Telecommunications		140
6.11 Payment of Property Taxes		140
6.12 Insurance Issues		140
6.13 Restrictions on the Use of Real Estate		141
6.14 Tenant’s Ability to Alter and Improve Real Estate		141
6.15 Specific Regulations		141
6.16 Effect of the Tenant’s Insolvency		142
6.17 Right to Occupy After Termination or Expiry of a Lease		142
6.18 Right to Assign a Leasehold Interest		142
6.19 Right to Terminate a Lease		142
6.20 Registration Requirements		143
6.21 Forced Eviction		143
6.22 Termination by a Third Party		143
6.23 Remedies/Damages for Breach		143
7. Construction		143
7.1 Common Structures Used to Price Construction Projects		143
7.2 Assigning Responsibility for the Design and Construction of a Project		144
7.3 Management of Construction Risk		144
7.4 Management of Schedule-Related Risk		145
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		145
7.6 Liens or Encumbrances in the Event of Non-Payment		145
7.7 Requirements Before Use or Inhabitation		146
8. Tax		146
8.1 VAT and Sales Tax		146
8.2 Mitigation of Tax Liability		146
8.3 Municipal Taxes		147
8.4 Income Tax Withholding for Foreign Investors		147
8.5 Tax Benefits		148
1. General		162
1.1 Main Sources of Law		162
1.2 Main Market Trends and Deals		162
1.3 Proposals for Reform		163
2. Sale and Purchase		163
2.1 Categories of Property Rights		163
2.2 Laws Applicable to Transfer of Title		163
2.3 Effecting Lawful and Proper Transfer of Title		164
2.4 Real Estate Due Diligence		164
2.5 Typical Representations and Warranties		165
2.6 Important Areas of Law for Investors		165
2.7 Soil Pollution or Environmental Contamination		165
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		166
2.9 Condemnation, Expropriation or Compulsory Purchase		167
2.10 Taxes Applicable to a Transaction		167
2.11 Legal Restrictions on Foreign Investors		168
3. Real Estate Finance		168
3.1 Financing Acquisitions of Commercial Real Estate		168
3.2 Typical Security Created by Commercial Investors		168
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		169
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		169
3.5 Legal Requirements Before an Entity Can Give Valid Security		169
3.6 Formalities When a Borrower Is in Default		169
3.7 Subordinating Existing Debt to Newly Created Debt		170
3.8 Lenders’ Liability Under Environmental Laws		170
3.9 Effects of a Borrower Becoming Insolvent		170
3.10 Taxes on Loans		170
4. Planning and Zoning		171
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		171
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		171
4.3 Regulatory Authorities		171
4.4 Obtaining Entitlements to Develop a New Project		171
4.5 Right of Appeal Against an Authority’s Decision		172
4.6 Agreements With Local or Governmental Authorities		172
4.7 Enforcement of Restrictions on Development and Designated Use		172
5. Investment Vehicles		173
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		173
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		173
5.3 REITs		174
5.4 Minimum Capital Requirement		174
5.5 Applicable Governance Requirements		174
5.6 Annual Entity Maintenance and Accounting Compliance		174
6. Commercial Leases		174
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		174
6.2 Types of Commercial Leases		175
6.3 Regulation of Rents or Lease Terms		175
6.4 Typical Terms of a Lease		175
6.5 Rent Variation		176
6.6 Determination of New Rent		176
6.7 Payment of VAT		176
6.8 Costs Payable by a Tenant at the Start of a Lease		176
6.9 Payment of Maintenance and Repair		176
6.10 Payment of Utilities and Telecommunications		177
6.11 Payment of Property Taxes		177
6.12 Insurance Issues		177
6.13 Restrictions on the Use of Real Estate		177
6.14 Tenant’s Ability to Alter and Improve Real Estate		177
6.15 Specific Regulations		177
6.16 Effect of the Tenant’s Insolvency		178
6.17 Right to Occupy After Termination or Expiry of a Lease		178
6.18 Right to Assign a Leasehold Interest		178
6.19 Right to Terminate a Lease		179
6.20 Registration Requirements		179
6.21 Forced Eviction		179
6.22 Termination by a Third Party		179
6.23 Remedies/Damages for Breach		180
7. Construction		180
7.1 Common Structures Used to Price Construction Projects		180
7.2 Assigning Responsibility for the Design and Construction of a Project		180
7.3 Management of Construction Risk		180
7.4 Management of Schedule-Related Risk		180
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		180
7.6 Liens or Encumbrances in the Event of Non-Payment		181
7.7 Requirements Before Use or Inhabitation		181
8. Tax		181
8.1 VAT and Sales Tax		181
8.2 Mitigation of Tax Liability		181
8.3 Municipal Taxes		182
8.4 Income Tax Withholding for Foreign Investors		182
8.5 Tax Benefits		182
1. General		189
1.1 Main Sources of Law		189
1.2 Main Market Trends and Deals		189
1.3 Proposals for Reform		191
2. Sale and Purchase		192
2.1 Categories of Property Rights		192
2.2 Laws Applicable to Transfer of Title		192
2.3 Effecting Lawful and Proper Transfer of Title		192
2.4 Real Estate Due Diligence		192
2.5 Typical Representations and Warranties		193
2.6 Important Areas of Law for Investors		193
2.7 Soil Pollution or Environmental Contamination		194
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		194
2.9 Condemnation, Expropriation or Compulsory Purchase		194
2.10 Taxes Applicable to a Transaction		195
2.11 Legal Restrictions on Foreign Investors		195
3. Real Estate Finance		195
3.1 Financing Acquisitions of Commercial Real Estate		195
3.2 Typical Security Created by Commercial Investors		196
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		196
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		196
3.5 Legal Requirements Before an Entity Can Give Valid Security		196
3.6 Formalities When a Borrower Is in Default		196
3.7 Subordinating Existing Debt to Newly Created Debt		197
3.8 Lenders’ Liability Under Environmental Laws		197
3.9 Effects of a Borrower Becoming Insolvent		197
3.10 Taxes on Loans		198
4. Planning and Zoning		198
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		198
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		198
4.3 Regulatory Authorities		199
4.4 Obtaining Entitlements to Develop a New Project		199
4.5 Right of Appeal Against an Authority’s Decision		199
4.6 Agreements With Local or Governmental Authorities		199
4.7 Enforcement of Restrictions on Development and Designated Use		200
5. Investment Vehicles		200
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		200
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		201
5.3 REITs		201
5.4 Minimum Capital Requirement		202
5.5 Applicable Governance Requirements		202
5.6 Annual Entity Maintenance and Accounting Compliance		202
6. Commercial Leases		202
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		202
6.2 Types of Commercial Leases		203
6.3 Regulation of Rents or Lease Terms		203
6.4 Typical Terms of a Lease		203
6.5 Rent Variation		203
6.6 Determination of New Rent		204
6.7 Payment of VAT		204
6.8 Costs Payable by a Tenant at the Start of a Lease		204
6.9 Payment of Maintenance and Repair		204
6.10 Payment of Utilities and Telecommunications		204
6.11 Payment of Property Taxes		204
6.12 Insurance Issues		205
6.13 Restrictions on the Use of Real Estate		205
6.14 Tenant’s Ability to Alter and Improve Real Estate		205
6.15 Specific Regulations		205
6.16 Effect of the Tenant’s Insolvency		206
6.17 Right to Occupy After Termination or Expiry of a Lease		206
6.18 Right to Assign a Leasehold Interest		206
6.19 Right to Terminate a Lease		206
6.20 Registration Requirements		206
6.21 Forced Eviction		207
6.22 Termination by a Third Party		207
6.23 Remedies/Damages for Breach		207
7. Construction		208
7.1 Common Structures Used to Price Construction Projects		208
7.2 Assigning Responsibility for the Design and Construction of a Project		208
7.3 Management of Construction Risk		208
7.4 Management of Schedule-Related Risk		209
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		209
7.6 Liens or Encumbrances in the Event of Non-Payment		209
7.7 Requirements Before Use or Inhabitation		210
8. Tax		210
8.1 VAT and Sales Tax		210
8.2 Mitigation of Tax Liability		210
8.3 Municipal Taxes		210
8.4 Income Tax Withholding for Foreign Investors		211
8.5 Tax Benefits		211
1. General		223
1.1 Main Sources of Law		223
1.2 Main Market Trends and Deals		223
1.3 Proposals for Reform		224
2. Sale and Purchase		226
2.1 Categories of Property Rights		226
2.2 Laws Applicable to Transfer of Title		226
2.3 Effecting Lawful and Proper Transfer of Title		226
2.4 Real Estate Due Diligence		227
2.5 Typical Representations and Warranties		227
2.6 Important Areas of Law for Investors		228
2.7 Soil Pollution or Environmental Contamination		228
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		228
2.9 Condemnation, Expropriation or Compulsory Purchase		228
2.10 Taxes Applicable to a Transaction		229
2.11 Legal Restrictions on Foreign Investors		229
3. Real Estate Finance		230
3.1 Financing Acquisitions of Commercial Real Estate		230
3.2 Typical Security Created by Commercial Investors		230
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		230
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		231
3.5 Legal Requirements Before an Entity Can Give Valid Security		231
3.6 Formalities When a Borrower Is in Default		231
3.7 Subordinating Existing Debt to Newly Created Debt		232
3.8 Lenders’ Liability Under Environmental Laws		232
3.9 Effects of a Borrower Becoming Insolvent		232
3.10 Taxes on Loans		232
4. Planning and Zoning		232
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		232
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		233
4.3 Regulatory Authorities		233
4.4 Obtaining Entitlements to Develop a New Project		233
4.5 Right of Appeal Against an Authority’s Decision		233
4.6 Agreements With Local or Governmental Authorities		233
4.7 Enforcement of Restrictions on Development and Designated Use		233
5. Investment Vehicles		234
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		234
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		234
5.3 REITs		234
5.4 Minimum Capital Requirement		235
5.5 Applicable Governance Requirements		235
5.6 Annual Entity Maintenance and Accounting Compliance		236
6. Commercial Leases		236
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		236
6.2 Types of Commercial Leases		236
6.3 Regulation of Rents or Lease Terms		236
6.4 Typical Terms of a Lease		236
6.5 Rent Variation		237
6.6 Determination of New Rent		237
6.7 Payment of VAT		237
6.8 Costs Payable by a Tenant at the Start of a Lease		237
6.9 Payment of Maintenance and Repair		237
6.10 Payment of Utilities and Telecommunications		237
6.11 Payment of Property Taxes		237
6.12 Insurance Issues		237
6.13 Restrictions on the Use of Real Estate		238
6.14 Tenant’s Ability to Alter and Improve Real Estate		238
6.15 Specific Regulations		238
6.16 Effect of the Tenant’s Insolvency		238
6.17 Right to Occupy After Termination or Expiry of a Lease		238
6.18 Right to Assign a Leasehold Interest		238
6.19 Right to Terminate a Lease		239
6.20 Registration Requirements		239
6.21 Forced Eviction		239
6.22 Termination by a Third Party		239
6.23 Remedies/Damages for Breach		239
7. Construction		240
7.1 Common Structures Used to Price Construction Projects		240
7.2 Assigning Responsibility for the Design and Construction of a Project		240
7.3 Management of Construction Risk		241
7.4 Management of Schedule-Related Risk		241
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		241
7.6 Liens or Encumbrances in the Event of Non-Payment		241
7.7 Requirements Before Use or Inhabitation		242
8. Tax		242
8.1 VAT and Sales Tax		242
8.2 Mitigation of Tax Liability		242
8.3 Municipal Taxes		243
8.4 Income Tax Withholding for Foreign Investors		243
8.5 Tax Benefits		244
1. General		256
1.1 Main Sources of Law		256
1.2 Main Market Trends and Deals		256
1.3 Proposals for Reform		257
2. Sale and Purchase		257
2.1 Categories of Property Rights		257
2.2 Laws Applicable to Transfer of Title		257
2.3 Effecting Lawful and Proper Transfer of Title		257
2.4 Real Estate Due Diligence		258
2.5 Typical Representations and Warranties		258
2.6 Important Areas of Law for Investors		259
2.7 Soil Pollution or Environmental Contamination		259
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		259
2.9 Condemnation, Expropriation or Compulsory Purchase		260
2.10 Taxes Applicable to a Transaction		260
2.11 Legal Restrictions on Foreign Investors		261
3. Real Estate Finance		261
3.1 Financing Acquisitions of Commercial Real Estate		261
3.2 Typical Security Created by Commercial Investors		262
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		262
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		262
3.5 Legal Requirements Before an Entity Can Give Valid Security		263
3.6 Formalities When a Borrower Is in Default		263
3.7 Subordinating Existing Debt to Newly Created Debt		263
3.8 Lenders’ Liability Under Environmental Laws		264
3.9 Effects of a Borrower Becoming Insolvent		264
3.10 Taxes on Loans		264
4. Planning and Zoning		264
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		264
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		265
4.3 Regulatory Authorities		265
4.4 Obtaining Entitlements to Develop a New Project		265
4.5 Right of Appeal Against an Authority’s Decision		265
4.6 Agreements With Local or Governmental Authorities		265
4.7 Enforcement of Restrictions on Development and Designated Use		266
5. Investment Vehicles		266
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		266
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		266
5.3 REITs		266
5.4 Minimum Capital Requirement		266
5.5 Applicable Governance Requirements		267
5.6 Annual Entity Maintenance and Accounting Compliance		267
6. Commercial Leases		267
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		267
6.2 Types of Commercial Leases		267
6.3 Regulation of Rents or Lease Terms		267
6.4 Typical Terms of a Lease		269
6.5 Rent Variation		269
6.6 Determination of New Rent		269
6.7 Payment of VAT		269
6.8 Costs Payable by a Tenant at the Start of a Lease		269
6.9 Payment of Maintenance and Repair		270
6.10 Payment of Utilities and Telecommunications		270
6.11 Payment of Property Taxes		270
6.12 Insurance Issues		270
6.13 Restrictions on the Use of Real Estate		270
6.14 Tenant’s Ability to Alter and Improve Real Estate		270
6.15 Specific Regulations		270
6.16 Effect of the Tenant’s Insolvency		270
6.17 Right to Occupy After Termination or Expiry of a Lease		270
6.18 Right to Assign a Leasehold Interest		271
6.19 Right to Terminate a Lease		271
6.20 Registration Requirements		271
6.21 Forced Eviction		271
6.22 Termination by a Third Party		271
6.23 Remedies/Damages for Breach		271
7. Construction		272
7.1 Common Structures Used to Price Construction Projects		272
7.2 Assigning Responsibility for the Design and Construction of a Project		272
7.3 Management of Construction Risk		272
7.4 Management of Schedule-Related Risk		272
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		272
7.6 Liens or Encumbrances in the Event of Non-Payment		272
7.7 Requirements Before Use or Inhabitation		272
8. Tax		272
8.1 VAT and Sales Tax		272
8.2 Mitigation of Tax Liability		274
8.3 Municipal Taxes		274
8.4 Income Tax Withholding for Foreign Investors		274
8.5 Tax Benefits		274
1. General		280
1.1 Main Sources of Law		280
1.2 Main Market Trends and Deals		280
1.3 Proposals for Reform		280
2. Sale and Purchase		280
2.1 Categories of Property Rights		280
2.2 Laws Applicable to Transfer of Title		281
2.3 Effecting Lawful and Proper Transfer of Title		281
2.4 Real Estate Due Diligence		281
2.5 Typical Representations and Warranties		281
2.6 Important Areas of Law for Investors		282
2.7 Soil Pollution or Environmental Contamination		282
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		283
2.9 Condemnation, Expropriation or Compulsory Purchase		283
2.10 Taxes Applicable to a Transaction		283
2.11 Legal Restrictions on Foreign Investors		284
3. Real Estate Finance		285
3.1 Financing Acquisitions of Commercial Real Estate		285
3.2 Typical Security Created by Commercial Investors		285
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		285
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		286
3.5 Legal Requirements Before an Entity Can Give Valid Security		286
3.6 Formalities When a Borrower Is in Default		286
3.7 Subordinating Existing Debt to Newly Created Debt		287
3.8 Lenders’ Liability Under Environmental Laws		287
3.9 Effects of a Borrower Becoming Insolvent		287
3.10 Taxes on Loans		287
4. Planning and Zoning		287
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		287
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		287
4.3 Regulatory Authorities		288
4.4 Obtaining Entitlements to Develop a New Project		288
4.5 Right of Appeal Against an Authority’s Decision		288
4.6 Agreements With Local or Governmental Authorities		289
4.7 Enforcement of Restrictions on Development and Designated Use		289
5. Investment Vehicles		289
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		289
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		289
5.3 REITs		290
5.4 Minimum Capital Requirement		290
5.5 Applicable Governance Requirements		290
5.6 Annual Entity Maintenance and Accounting Compliance		291
6. Commercial Leases		291
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		291
6.2 Types of Commercial Leases		292
6.3 Regulation of Rents or Lease Terms		292
6.4 Typical Terms of a Lease		292
6.5 Rent Variation		292
6.6 Determination of New Rent		292
6.7 Payment of VAT		292
6.8 Costs Payable by a Tenant at the Start of a Lease		293
6.9 Payment of Maintenance and Repair		293
6.10 Payment of Utilities and Telecommunications		293
6.11 Payment of Property Taxes		293
6.12 Insurance Issues		293
6.13 Restrictions on the Use of Real Estate		293
6.14 Tenant’s Ability to Alter and Improve Real Estate		294
6.15 Specific Regulations		294
6.16 Effect of the Tenant’s Insolvency		294
6.17 Right to Occupy After Termination or Expiry of a Lease		294
6.18 Right to Assign a Leasehold Interest		295
6.19 Right to Terminate a Lease		295
6.20 Registration Requirements		295
6.21 Forced Eviction		295
6.22 Termination by a Third Party		296
6.23 Remedies/Damages for Breach		296
7. Construction		296
7.1 Common Structures Used to Price Construction Projects		296
7.2 Assigning Responsibility for the Design and Construction of a Project		297
7.3 Management of Construction Risk		297
7.4 Management of Schedule-Related Risk		297
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		298
7.6 Liens or Encumbrances in the Event of Non-Payment		298
7.7 Requirements Before Use or Inhabitation		298
8. Tax		299
8.1 VAT and Sales Tax		299
8.2 Mitigation of Tax Liability		299
8.3 Municipal Taxes		299
8.4 Income Tax Withholding for Foreign Investors		299
8.5 Tax Benefits		300
1. General		319
1.1 Main Sources of Law		319
1.2 Main Market Trends and Deals		319
1.3 Proposals for Reform		321
2. Sale and Purchase		321
2.1 Categories of Property Rights		321
2.2 Laws Applicable to Transfer of Title		321
2.3 Effecting Lawful and Proper Transfer of Title		322
2.4 Real Estate Due Diligence		322
2.5 Typical Representations and Warranties		323
2.6 Important Areas of Law for Investors		323
2.7 Soil Pollution or Environmental Contamination		323
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		323
2.9 Condemnation, Expropriation or Compulsory Purchase		324
2.10 Taxes Applicable to a Transaction		324
2.11 Legal Restrictions on Foreign Investors		324
3. Real Estate Finance		325
3.1 Financing Acquisitions of Commercial Real Estate		325
3.2 Typical Security Created by Commercial Investors		325
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		325
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		326
3.5 Legal Requirements Before an Entity Can Give Valid Security		326
3.6 Formalities When a Borrower Is in Default		326
3.7 Subordinating Existing Debt to Newly Created Debt		327
3.8 Lenders’ Liability Under Environmental Laws		327
3.9 Effects of a Borrower Becoming Insolvent		327
3.10 Taxes on Loans		327
4. Planning and Zoning		328
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		328
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		328
4.3 Regulatory Authorities		328
4.4 Obtaining Entitlements to Develop a New Project		328
4.5 Right of Appeal Against an Authority’s Decision		328
4.6 Agreements With Local or Governmental Authorities		329
4.7 Enforcement of Restrictions on Development and Designated Use		329
5. Investment Vehicles		329
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		329
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		330
5.3 REITs		330
5.4 Minimum Capital Requirement		330
5.5 Applicable Governance Requirements		330
5.6 Annual Entity Maintenance and Accounting Compliance		331
6. Commercial Leases		331
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		331
6.2 Types of Commercial Leases		331
6.3 Regulation of Rents or Lease Terms		331
6.4 Typical Terms of a Lease		331
6.5 Rent Variation		332
6.6 Determination of New Rent		332
6.7 Payment of VAT		332
6.8 Costs Payable by a Tenant at the Start of a Lease		332
6.9 Payment of Maintenance and Repair		332
6.10 Payment of Utilities and Telecommunications		332
6.11 Payment of Property Taxes		332
6.12 Insurance Issues		332
6.13 Restrictions on the Use of Real Estate		332
6.14 Tenant’s Ability to Alter and Improve Real Estate		332
6.15 Specific Regulations		332
6.16 Effect of the Tenant’s Insolvency		333
6.17 Right to Occupy After Termination or Expiry of a Lease		333
6.18 Right to Assign a Leasehold Interest		333
6.19 Right to Terminate a Lease		333
6.20 Registration Requirements		333
6.21 Forced Eviction		334
6.22 Termination by a Third Party		334
6.23 Remedies/Damages for Breach		334
7. Construction		334
7.1 Common Structures Used to Price Construction Projects		334
7.2 Assigning Responsibility for the Design and Construction of a Project		334
7.3 Management of Construction Risk		334
7.4 Management of Schedule-Related Risk		335
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		335
7.6 Liens or Encumbrances in the Event of Non-Payment		335
7.7 Requirements Before Use or Inhabitation		335
8. Tax		335
8.1 VAT and Sales Tax		335
8.2 Mitigation of Tax Liability		335
8.3 Municipal Taxes		335
8.4 Income Tax Withholding for Foreign Investors		336
8.5 Tax Benefits		336
1. General		348
1.1 Main Sources of Law		348
1.2 Main Market Trends and Deals		348
1.3 Proposals for Reform		349
2. Sale and Purchase		349
2.1 Categories of Property Rights		349
2.2 Laws Applicable to Transfer of Title		350
2.3 Effecting Lawful and Proper Transfer of Title		350
2.4 Real Estate Due Diligence		350
2.5 Typical Representations and Warranties		350
2.6 Important Areas of Law for Investors		351
2.7 Soil Pollution or Environmental Contamination		351
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		351
2.9 Condemnation, Expropriation or Compulsory Purchase		352
2.10 Taxes Applicable to a Transaction		352
2.11 Legal Restrictions on Foreign Investors		352
3. Real Estate Finance		352
3.1 Financing Acquisitions of Commercial Real Estate		352
3.2 Typical Security Created by Commercial Investors		353
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		353
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		353
3.5 Legal Requirements Before an Entity Can Give Valid Security		354
3.6 Formalities When a Borrower Is in Default		354
3.7 Subordinating Existing Debt to Newly Created Debt		355
3.8 Lenders’ Liability Under Environmental Laws		355
3.9 Effects of a Borrower Becoming Insolvent		355
3.10 Taxes on Loans		356
4. Planning and Zoning		356
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		356
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		356
4.3 Regulatory Authorities		356
4.4 Obtaining Entitlements to Develop a New Project		357
4.5 Right of Appeal Against an Authority’s Decision		357
4.6 Agreements With Local or Governmental Authorities		357
4.7 Enforcement of Restrictions on Development and Designated Use		357
5. Investment Vehicles		357
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		357
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		358
5.3 REITs		358
5.4 Minimum Capital Requirement		358
5.5 Applicable Governance Requirements		358
5.6 Annual Entity Maintenance and Accounting Compliance		359
6. Commercial Leases		359
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		359
6.2 Types of Commercial Leases		359
6.3 Regulation of Rents or Lease Terms		359
6.4 Typical Terms of a Lease		359
6.5 Rent Variation		359
6.6 Determination of New Rent		360
6.7 Payment of VAT		360
6.8 Costs Payable by a Tenant at the Start of a Lease		360
6.9 Payment of Maintenance and Repair		360
6.10 Payment of Utilities and Telecommunications		360
6.11 Payment of Property Taxes		360
6.12 Insurance Issues		361
6.13 Restrictions on the Use of Real Estate		361
6.14 Tenant’s Ability to Alter and Improve Real Estate		361
6.15 Specific Regulations		361
6.16 Effect of the Tenant’s Insolvency		362
6.17 Right to Occupy After Termination or Expiry of a Lease		362
6.18 Right to Assign a Leasehold Interest		362
6.19 Right to Terminate a Lease		362
6.20 Registration Requirements		363
6.21 Forced Eviction		363
6.22 Termination by a Third Party		363
6.23 Remedies/Damages for Breach		364
7. Construction		364
7.1 Common Structures Used to Price Construction Projects		364
7.2 Assigning Responsibility for the Design and Construction of a Project		364
7.3 Management of Construction Risk		364
7.4 Management of Schedule-Related Risk		365
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		365
7.6 Liens or Encumbrances in the Event of Non-Payment		365
7.7 Requirements Before Use or Inhabitation		365
8. Tax		366
8.1 VAT and Sales Tax		366
8.2 Mitigation of Tax Liability		366
8.3 Municipal Taxes		366
8.4 Income Tax Withholding for Foreign Investors		366
8.5 Tax Benefits		367
1. General		379
1.1 Main Sources of Law		379
1.2 Main Market Trends and Deals		379
1.3 Proposals for Reform		379
2. Sale and Purchase		380
2.1 Categories of Property Rights		380
2.2 Laws Applicable to Transfer of Title		380
2.3 Effecting Lawful and Proper Transfer of Title		380
2.4 Real Estate Due Diligence		380
2.5 Typical Representations and Warranties		381
2.6 Important Areas of Law for Investors		381
2.7 Soil Pollution or Environmental Contamination		381
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		382
2.9 Condemnation, Expropriation or Compulsory Purchase		382
2.10 Taxes Applicable to a Transaction		382
2.11 Legal Restrictions on Foreign Investors		382
3. Real Estate Finance		383
3.1 Financing Acquisitions of Commercial Real Estate		383
3.2 Typical Security Created by Commercial Investors		383
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		383
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		383
3.5 Legal Requirements Before an Entity Can Give Valid Security		384
3.6 Formalities When a Borrower Is in Default		384
3.7 Subordinating Existing Debt to Newly Created Debt		385
3.8 Lenders’ Liability Under Environmental Laws		385
3.9 Effects of a Borrower Becoming Insolvent		385
3.10 Taxes on Loans		386
4. Planning and Zoning		386
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		386
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		387
4.3 Regulatory Authorities		388
4.4 Obtaining Entitlements to Develop a New Project		388
4.5 Right of Appeal Against an Authority’s Decision		388
4.6 Agreements With Local or Governmental Authorities		388
4.7 Enforcement of Restrictions on Development and Designated Use		388
5. Investment Vehicles		389
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		389
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		389
5.3 REITs		389
5.4 Minimum Capital Requirement		390
5.5 Applicable Governance Requirements		391
5.6 Annual Entity Maintenance and Accounting Compliance		391
6. Commercial Leases		391
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		391
6.2 Types of Commercial Leases		391
6.3 Regulation of Rents or Lease Terms		392
6.4 Typical Terms of a Lease		392
6.5 Rent Variation		392
6.6 Determination of New Rent		392
6.7 Payment of VAT		393
6.8 Costs Payable by a Tenant at the Start of a Lease		393
6.9 Payment of Maintenance and Repair		393
6.10 Payment of Utilities and Telecommunications		393
6.11 Payment of Property Taxes		393
6.12 Insurance Issues		393
6.13 Restrictions on the Use of Real Estate		394
6.14 Tenant’s Ability to Alter and Improve Real Estate		394
6.15 Specific Regulations		394
6.16 Effect of the Tenant’s Insolvency		394
6.17 Right to Occupy After Termination or Expiry of a Lease		395
6.18 Right to Assign a Leasehold Interest		395
6.19 Right to Terminate a Lease		395
6.20 Registration Requirements		395
6.21 Forced Eviction		395
6.22 Termination by a Third Party		396
6.23 Remedies/Damages for Breach		396
7. Construction		396
7.1 Common Structures Used to Price Construction Projects		396
7.2 Assigning Responsibility for the Design and Construction of a Project		396
7.3 Management of Construction Risk		396
7.4 Management of Schedule-Related Risk		397
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		397
7.6 Liens or Encumbrances in the Event of Non-Payment		397
7.7 Requirements Before Use or Inhabitation		397
8. Tax		398
8.1 VAT and Sales Tax		398
8.2 Mitigation of Tax Liability		398
8.3 Municipal Taxes		398
8.4 Income Tax Withholding for Foreign Investors		398
8.5 Tax Benefits		399
1. General		413
1.1 Main Sources of Law		413
1.2 Main Market Trends and Deals		413
1.3 Proposals for Reform		414
2. Sale and Purchase		414
2.1 Categories of Property Rights		414
2.2 Laws Applicable to Transfer of Title		414
2.3 Effecting Lawful and Proper Transfer of Title		415
2.4 Real Estate Due Diligence		415
2.5 Typical Representations and Warranties		415
2.6 Important Areas of Law for Investors		415
2.7 Soil Pollution or Environmental Contamination		416
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		416
2.9 Condemnation, Expropriation or Compulsory Purchase		416
2.10 Taxes Applicable to a Transaction		416
2.11 Legal Restrictions on Foreign Investors		417
3. Real Estate Finance		418
3.1 Financing Acquisitions of Commercial Real Estate		418
3.2 Typical Security Created by Commercial Investors		418
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		418
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		418
3.5 Legal Requirements Before an Entity Can Give Valid Security		418
3.6 Formalities When a Borrower Is in Default		419
3.7 Subordinating Existing Debt to Newly Created Debt		420
3.8 Lenders’ Liability Under Environmental Laws		420
3.9 Effects of a Borrower Becoming Insolvent		420
3.10 Taxes on Loans		421
4. Planning and Zoning		421
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		421
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		421
4.3 Regulatory Authorities		421
4.4 Obtaining Entitlements to Develop a New Project		422
4.5 Right of Appeal Against an Authority’s Decision		422
4.6 Agreements With Local or Governmental Authorities		422
4.7 Enforcement of Restrictions on Development and Designated Use		422
5. Investment Vehicles		423
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		423
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		423
5.3 REITs		423
5.4 Minimum Capital Requirement		423
5.5 Applicable Governance Requirements		424
5.6 Annual Entity Maintenance and Accounting Compliance		424
6. Commercial Leases		425
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		425
6.2 Types of Commercial Leases		425
6.3 Regulation of Rents or Lease Terms		425
6.4 Typical Terms of a Lease		425
6.5 Rent Variation		425
6.6 Determination of New Rent		426
6.7 Payment of VAT		426
6.8 Costs Payable by a Tenant at the Start of a Lease		426
6.9 Payment of Maintenance and Repair		426
6.10 Payment of Utilities and Telecommunications		426
6.11 Payment of Property Taxes		426
6.12 Insurance Issues		426
6.13 Restrictions on the Use of Real Estate		427
6.14 Tenant’s Ability to Alter and Improve Real Estate		427
6.15 Specific Regulations		427
6.16 Effect of the Tenant’s Insolvency		427
6.17 Right to Occupy After Termination or Expiry of a Lease		427
6.18 Right to Assign a Leasehold Interest		428
6.19 Right to Terminate a Lease		428
6.20 Registration Requirements		428
6.21 Forced Eviction		428
6.22 Termination by a Third Party		428
6.23 Remedies/Damages for Breach		429
7. Construction		429
7.1 Common Structures Used to Price Construction Projects		429
7.2 Assigning Responsibility for the Design and Construction of a Project		429
7.3 Management of Construction Risk		429
7.4 Management of Schedule-Related Risk		430
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		430
7.6 Liens or Encumbrances in the Event of Non-Payment		430
7.7 Requirements Before Use or Inhabitation		430
8. Tax		430
8.1 VAT and Sales Tax		430
8.2 Mitigation of Tax Liability		431
8.3 Municipal Taxes		431
8.4 Income Tax Withholding for Foreign Investors		432
8.5 Tax Benefits		432
1. General		437
1.1 Main Sources of Law		437
1.2 Main Market Trends and Deals		437
1.3 Proposals for Reform		438
2. Sale and Purchase		439
2.1 Categories of Property Rights		439
2.2 Laws Applicable to Transfer of Title		439
2.3 Effecting Lawful and Proper Transfer of Title		440
2.4 Real Estate Due Diligence		440
2.5 Typical Representations and Warranties		440
2.6 Important Areas of Law for Investors		441
2.7 Soil Pollution or Environmental Contamination		441
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		441
2.9 Condemnation, Expropriation or Compulsory Purchase		441
2.10 Taxes Applicable to a Transaction		442
2.11 Legal Restrictions on Foreign Investors		442
3. Real Estate Finance		443
3.1 Financing Acquisitions of Commercial Real Estate		443
3.2 Typical Security Created by Commercial Investors		444
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		444
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		445
3.5 Legal Requirements Before an Entity Can Give Valid Security		445
3.6 Formalities When a Borrower Is in Default		445
3.7 Subordinating Existing Debt to Newly Created Debt		445
3.8 Lenders’ Liability Under Environmental Laws		446
3.9 Effects of a Borrower Becoming Insolvent		446
3.10 Taxes on Loans		446
4. Planning and Zoning		446
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		446
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		447
4.3 Regulatory Authorities		447
4.4 Obtaining Entitlements to Develop a New Project		447
4.5 Right of Appeal Against an Authority’s Decision		447
4.6 Agreements With Local or Governmental Authorities		447
4.7 Enforcement of Restrictions on Development and Designated Use		448
5. Investment Vehicles		448
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		448
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		448
5.3 REITs		449
5.4 Minimum Capital Requirement		449
5.5 Applicable Governance Requirements		449
5.6 Annual Entity Maintenance and Accounting Compliance		450
6. Commercial Leases		450
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		450
6.2 Types of Commercial Leases		450
6.3 Regulation of Rents or Lease Terms		450
6.4 Typical Terms of a Lease		450
6.5 Rent Variation		450
6.6 Determination of New Rent		450
6.7 Payment of VAT		451
6.8 Costs Payable by a Tenant at the Start of a Lease		451
6.9 Payment of Maintenance and Repair		451
6.10 Payment of Utilities and Telecommunications		451
6.11 Payment of Property Taxes		451
6.12 Insurance Issues		451
6.13 Restrictions on the Use of Real Estate		452
6.14 Tenant’s Ability to Alter and Improve Real Estate		452
6.15 Specific Regulations		452
6.16 Effect of the Tenant’s Insolvency		452
6.17 Right to Occupy After Termination or Expiry of a Lease		452
6.18 Right to Assign a Leasehold Interest		452
6.19 Right to Terminate a Lease		453
6.20 Registration Requirements		453
6.21 Forced Eviction		453
6.22 Termination by a Third Party		453
6.23 Remedies/Damages for Breach		453
7. Construction		454
7.1 Common Structures Used to Price Construction Projects		454
7.2 Assigning Responsibility for the Design and Construction of a Project		454
7.3 Management of Construction Risk		454
7.4 Management of Schedule-Related Risk		454
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		455
7.6 Liens or Encumbrances in the Event of Non-Payment		455
7.7 Requirements Before Use or Inhabitation		455
8. Tax		455
8.1 VAT and Sales Tax		455
8.2 Mitigation of Tax Liability		455
8.3 Municipal Taxes		456
8.4 Income Tax Withholding for Foreign Investors		456
8.5 Tax Benefits		457
1. General		469
1.1 Main Sources of Law		469
1.2 Main Market Trends and Deals		469
1.3 Proposals for Reform		470
2. Sale and Purchase		470
2.1 Categories of Property Rights		470
2.2 Laws Applicable to Transfer of Title		471
2.3 Effecting Lawful and Proper Transfer of Title		471
2.4 Real Estate Due Diligence		471
2.5 Typical Representations and Warranties		472
2.6 Important Areas of Law for Investors		473
2.7 Soil Pollution or Environmental Contamination		473
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		473
2.9 Condemnation, Expropriation or Compulsory Purchase		473
2.10 Taxes Applicable to a Transaction		474
2.11 Legal Restrictions on Foreign Investors		475
3. Real Estate Finance		475
3.1 Financing Acquisitions of Commercial Real Estate		475
3.2 Typical Security Created by Commercial Investors		475
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		475
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		475
3.5 Legal Requirements Before an Entity Can Give Valid Security		476
3.6 Formalities When a Borrower Is in Default		477
3.7 Subordinating Existing Debt to Newly Created Debt		478
3.8 Lenders’ Liability Under Environmental Laws		478
3.9 Effects of a Borrower Becoming Insolvent		478
3.10 Taxes on Loans		478
4. Planning and Zoning		478
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		478
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		479
4.3 Regulatory Authorities		479
4.4 Obtaining Entitlements to Develop a New Project		479
4.5 Right of Appeal Against an Authority’s Decision		480
4.6 Agreements With Local or Governmental Authorities		480
4.7 Enforcement of Restrictions on Development and Designated Use		480
5. Investment Vehicles		480
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		480
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		481
5.3 REITs		481
5.4 Minimum Capital Requirement		481
5.5 Applicable Governance Requirements		482
5.6 Annual Entity Maintenance and Accounting Compliance		482
6. Commercial Leases		483
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		483
6.2 Types of Commercial Leases		483
6.3 Regulation of Rents or Lease Terms		483
6.4 Typical Terms of a Lease		483
6.5 Rent Variation		483
6.6 Determination of New Rent		484
6.7 Payment of VAT		484
6.8 Costs Payable by a Tenant at the Start of a Lease		484
6.9 Payment of Maintenance and Repair		484
6.10 Payment of Utilities and Telecommunications		484
6.11 Payment of Property Taxes		484
6.12 Insurance Issues		484
6.13 Restrictions on the Use of Real Estate		485
6.14 Tenant’s Ability to Alter and Improve Real Estate		485
6.15 Specific Regulations		485
6.16 Effect of the Tenant’s Insolvency		485
6.17 Right to Occupy After Termination or Expiry of a Lease		485
6.18 Right to Assign a Leasehold Interest		485
6.19 Right to Terminate a Lease		486
6.20 Registration Requirements		486
6.21 Forced Eviction		486
6.22 Termination by a Third Party		486
6.23 Remedies/Damages for Breach		486
7. Construction		486
7.1 Common Structures Used to Price Construction Projects		486
7.2 Assigning Responsibility for the Design and Construction of a Project		486
7.3 Management of Construction Risk		487
7.4 Management of Schedule-Related Risk		487
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		487
7.6 Liens or Encumbrances in the Event of Non-Payment		487
7.7 Requirements Before Use or Inhabitation		487
8. Tax		487
8.1 VAT and Sales Tax		487
8.2 Mitigation of Tax Liability		488
8.3 Municipal Taxes		488
8.4 Income Tax Withholding for Foreign Investors		488
8.5 Tax Benefits		489
1. General		502
1.1 Main Sources of Law		502
1.2 Main Market Trends and Deals		502
1.3 Proposals for Reform		504
2. Sale and Purchase		504
2.1 Categories of Property Rights		504
2.2 Laws Applicable to Transfer of Title		504
2.3 Effecting Lawful and Proper Transfer of Title		505
2.4 Real Estate Due Diligence		505
2.5 Typical Representations and Warranties		505
2.6 Important Areas of Law for Investors		506
2.7 Soil Pollution or Environmental Contamination		506
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		506
2.9 Condemnation, Expropriation or Compulsory Purchase		507
2.10 Taxes Applicable to a Transaction		507
2.11 Legal Restrictions on Foreign Investors		508
3. Real Estate Finance		508
3.1 Financing Acquisitions of Commercial Real Estate		508
3.2 Typical Security Created by Commercial Investors		509
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		509
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		510
3.5 Legal Requirements Before an Entity Can Give Valid Security		510
3.6 Formalities When a Borrower Is in Default		510
3.7 Subordinating Existing Debt to Newly Created Debt		511
3.8 Lenders’ Liability Under Environmental Laws		511
3.9 Effects of a Borrower Becoming Insolvent		511
3.10 Taxes on Loans		511
4. Planning and Zoning		512
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		512
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		512
4.3 Regulatory Authorities		512
4.4 Obtaining Entitlements to Develop a New Project		512
4.5 Right of Appeal Against an Authority’s Decision		513
4.6 Agreements With Local or Governmental Authorities		513
4.7 Enforcement of Restrictions on Development and Designated Use		513
5. Investment Vehicles		513
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		513
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		514
5.3 REITs		515
5.4 Minimum Capital Requirement		515
5.5 Applicable Governance Requirements		515
5.6 Annual Entity Maintenance and Accounting Compliance		515
6. Commercial Leases		516
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		516
6.2 Types of Commercial Leases		516
6.3 Regulation of Rents or Lease Terms		516
6.4 Typical Terms of a Lease		516
6.5 Rent Variation		517
6.6 Determination of New Rent		517
6.7 Payment of VAT		517
6.8 Costs Payable by a Tenant at the Start of a Lease		517
6.9 Payment of Maintenance and Repair		517
6.10 Payment of Utilities and Telecommunications		517
6.11 Payment of Property Taxes		517
6.12 Insurance Issues		518
6.13 Restrictions on the Use of Real Estate		518
6.14 Tenant’s Ability to Alter and Improve Real Estate		518
6.15 Specific Regulations		518
6.16 Effect of the Tenant’s Insolvency		518
6.17 Right to Occupy After Termination or Expiry of a Lease		518
6.18 Right to Assign a Leasehold Interest		518
6.19 Right to Terminate a Lease		519
6.20 Registration Requirements		519
6.21 Forced Eviction		519
6.22 Termination by a Third Party		519
6.23 Remedies/Damages for Breach		519
7. Construction		519
7.1 Common Structures Used to Price Construction Projects		519
7.2 Assigning Responsibility for the Design and Construction of a Project		519
7.3 Management of Construction Risk		519
7.4 Management of Schedule-Related Risk		520
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		520
7.6 Liens or Encumbrances in the Event of Non-Payment		520
7.7 Requirements Before Use or Inhabitation		520
8. Tax		520
8.1 VAT and Sales Tax		520
8.2 Mitigation of Tax Liability		520
8.3 Municipal Taxes		520
8.4 Income Tax Withholding for Foreign Investors		520
8.5 Tax Benefits		522
1. General		534
1.1 Main Sources of Law		534
1.2 Main Market Trends and Deals		534
1.3 Proposals for Reform		534
2. Sale and Purchase		535
2.1 Categories of Property Rights		535
2.2 Laws Applicable to Transfer of Title		536
2.3 Effecting Lawful and Proper Transfer of Title		536
2.4 Real Estate Due Diligence		536
2.5 Typical Representations and Warranties		537
2.6 Important Areas of Law for Investors		537
2.7 Soil Pollution or Environmental Contamination		537
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		537
2.9 Condemnation, Expropriation or Compulsory Purchase		538
2.10 Taxes Applicable to a Transaction		538
2.11 Legal Restrictions on Foreign Investors		538
3. Real Estate Finance		538
3.1 Financing Acquisitions of Commercial Real Estate		538
3.2 Typical Security Created by Commercial Investors		538
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		539
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		539
3.5 Legal Requirements Before an Entity Can Give Valid Security		539
3.6 Formalities When a Borrower Is in Default		539
3.7 Subordinating Existing Debt to Newly Created Debt		539
3.8 Lenders’ Liability Under Environmental Laws		539
3.9 Effects of a Borrower Becoming Insolvent		540
3.10 Taxes on Loans		540
4. Planning and Zoning		540
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		540
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		540
4.3 Regulatory Authorities		540
4.4 Obtaining Entitlements to Develop a New Project		540
4.5 Right of Appeal Against an Authority’s Decision		541
4.6 Agreements With Local or Governmental Authorities		541
4.7 Enforcement of Restrictions on Development and Designated Use		541
5. Investment Vehicles		541
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		541
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		542
5.3 REITs		542
5.4 Minimum Capital Requirement		542
5.5 Applicable Governance Requirements		543
5.6 Annual Entity Maintenance and Accounting Compliance		544
6. Commercial Leases		544
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		544
6.2 Types of Commercial Leases		544
6.3 Regulation of Rents or Lease Terms		545
6.4 Typical Terms of a Lease		545
6.5 Rent Variation		545
6.6 Determination of New Rent		546
6.7 Payment of VAT		546
6.8 Costs Payable by a Tenant at the Start of a Lease		546
6.9 Payment of Maintenance and Repair		546
6.10 Payment of Utilities and Telecommunications		546
6.11 Payment of Property Taxes		546
6.12 Insurance Issues		546
6.13 Restrictions on the Use of Real Estate		547
6.14 Tenant’s Ability to Alter and Improve Real Estate		547
6.15 Specific Regulations		547
6.16 Effect of the Tenant’s Insolvency		547
6.17 Right to Occupy After Termination or Expiry of a Lease		547
6.18 Right to Assign a Leasehold Interest		548
6.19 Right to Terminate a Lease		548
6.20 Registration Requirements		548
6.21 Forced Eviction		548
6.22 Termination by a Third Party		549
6.23 Remedies/Damages for Breach		549
7. Construction		549
7.1 Common Structures Used to Price Construction Projects		549
7.2 Assigning Responsibility for the Design and Construction of a Project		549
7.3 Management of Construction Risk		549
7.4 Management of Schedule-Related Risk		550
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		550
7.6 Liens or Encumbrances in the Event of Non-Payment		550
7.7 Requirements Before Use or Inhabitation		550
8. Tax		550
8.1 VAT and Sales Tax		550
8.2 Mitigation of Tax Liability		551
8.3 Municipal Taxes		551
8.4 Income Tax Withholding for Foreign Investors		551
8.5 Tax Benefits		552
1. General		564
1.1 Main Sources of Law		564
1.2 Main Market Trends and Deals		564
1.3 Proposals for Reform		566
2. Sale and Purchase		567
2.1 Categories of Property Rights		567
2.2 Laws Applicable to Transfer of Title		567
2.3 Effecting Lawful and Proper Transfer of Title		567
2.4 Real Estate Due Diligence		568
2.5 Typical Representations and Warranties		568
2.6 Important Areas of Law for Investors		569
2.7 Soil Pollution or Environmental Contamination		569
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		569
2.9 Condemnation, Expropriation or Compulsory Purchase		569
2.10 Taxes Applicable to a Transaction		570
2.11 Legal Restrictions on Foreign Investors		571
3. Real Estate Finance		571
3.1 Financing Acquisitions of Commercial Real Estate		571
3.2 Typical Security Created by Commercial Investors		572
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		572
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		572
3.5 Legal Requirements Before an Entity Can Give Valid Security		572
3.6 Formalities When a Borrower Is in Default		572
3.7 Subordinating Existing Debt to Newly Created Debt		573
3.8 Lenders’ Liability Under Environmental Laws		573
3.9 Effects of a Borrower Becoming Insolvent		573
3.10 Taxes on Loans		573
4. Planning and Zoning		574
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		574
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		574
4.3 Regulatory Authorities		574
4.4 Obtaining Entitlements to Develop a New Project		574
4.5 Right of Appeal Against an Authority’s Decision		575
4.6 Agreements With Local or Governmental Authorities		575
4.7 Enforcement of Restrictions on Development and Designated Use		576
5. Investment Vehicles		576
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		576
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		576
5.3 REITs		577
5.4 Minimum Capital Requirement		578
5.5 Applicable Governance Requirements		578
5.6 Annual Entity Maintenance and Accounting Compliance		579
6. Commercial Leases		579
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		579
6.2 Types of Commercial Leases		579
6.3 Regulation of Rents or Lease Terms		580
6.4 Typical Terms of a Lease		580
6.5 Rent Variation		581
6.6 Determination of New Rent		581
6.7 Payment of VAT		581
6.8 Costs Payable by a Tenant at the Start of a Lease		581
6.9 Payment of Maintenance and Repair		581
6.10 Payment of Utilities and Telecommunications		581
6.11 Payment of Property Taxes		582
6.12 Insurance Issues		582
6.13 Restrictions on the Use of Real Estate		582
6.14 Tenant’s Ability to Alter and Improve Real Estate		582
6.15 Specific Regulations		583
6.16 Effect of the Tenant’s Insolvency		583
6.17 Right to Occupy After Termination or Expiry of a Lease		583
6.18 Right to Assign a Leasehold Interest		583
6.19 Right to Terminate a Lease		583
6.20 Registration Requirements		584
6.21 Forced Eviction		584
6.22 Termination by a Third Party		584
6.23 Remedies/Damages for Breach		584
7. Construction		585
7.1 Common Structures Used to Price Construction Projects		585
7.2 Assigning Responsibility for the Design and Construction of a Project		585
7.3 Management of Construction Risk		585
7.4 Management of Schedule-Related Risk		586
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		586
7.6 Liens or Encumbrances in the Event of Non-Payment		586
7.7 Requirements Before Use or Inhabitation		586
8. Tax		586
8.1 VAT and Sales Tax		586
8.2 Mitigation of Tax Liability		586
8.3 Municipal Taxes		587
8.4 Income Tax Withholding for Foreign Investors		587
8.5 Tax Benefits		587
1. General		593
1.1 Main Sources of Law		593
1.2 Main Market Trends and Deals		593
1.3 Proposals for Reform		593
2. Sale and Purchase		594
2.1 Categories of Property Rights		594
2.2 Laws Applicable to Transfer of Title		594
2.3 Effecting Lawful and Proper Transfer of Title		594
2.4 Real Estate Due Diligence		595
2.5 Typical Representations and Warranties		595
2.6 Important Areas of Law for Investors		596
2.7 Soil Pollution or Environmental Contamination		596
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		596
2.9 Condemnation, Expropriation or Compulsory Purchase		596
2.10 Taxes Applicable to a Transaction		596
2.11 Legal Restrictions on Foreign Investors		597
3. Real Estate Finance		597
3.1 Financing Acquisitions of Commercial Real Estate		597
3.2 Typical Security Created by Commercial Investors		598
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		598
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		598
3.5 Legal Requirements Before an Entity Can Give Valid Security		598
3.6 Formalities When a Borrower Is in Default		599
3.7 Subordinating Existing Debt to Newly Created Debt		599
3.8 Lenders’ Liability Under Environmental Laws		599
3.9 Effects of a Borrower Becoming Insolvent		599
3.10 Taxes on Loans		599
4. Planning and Zoning		600
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		600
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		600
4.3 Regulatory Authorities		600
4.4 Obtaining Entitlements to Develop a New Project		601
4.5 Right of Appeal Against an Authority’s Decision		601
4.6 Agreements With Local or Governmental Authorities		601
4.7 Enforcement of Restrictions on Development and Designated Use		602
5. Investment Vehicles		602
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		602
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		602
5.3 REITs		602
5.4 Minimum Capital Requirement		602
5.5 Applicable Governance Requirements		602
5.6 Annual Entity Maintenance and Accounting Compliance		603
6. Commercial Leases		603
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		603
6.2 Types of Commercial Leases		603
6.3 Regulation of Rents or Lease Terms		603
6.4 Typical Terms of a Lease		603
6.5 Rent Variation		603
6.6 Determination of New Rent		603
6.7 Payment of VAT		604
6.8 Costs Payable by a Tenant at the Start of a Lease		604
6.9 Payment of Maintenance and Repair		604
6.10 Payment of Utilities and Telecommunications		604
6.11 Payment of Property Taxes		604
6.12 Insurance Issues		604
6.13 Restrictions on the Use of Real Estate		604
6.14 Tenant’s Ability to Alter and Improve Real Estate		605
6.15 Specific Regulations		605
6.16 Effect of the Tenant’s Insolvency		605
6.17 Right to Occupy After Termination or Expiry of a Lease		605
6.18 Right to Assign a Leasehold Interest		605
6.19 Right to Terminate a Lease		605
6.20 Registration Requirements		606
6.21 Forced Eviction		606
6.22 Termination by a Third Party		606
6.23 Remedies/Damages for Breach		606
7. Construction		607
7.1 Common Structures Used to Price Construction Projects		607
7.2 Assigning Responsibility for the Design and Construction of a Project		607
7.3 Management of Construction Risk		607
7.4 Management of Schedule-Related Risk		608
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		608
7.6 Liens or Encumbrances in the Event of Non-Payment		608
7.7 Requirements Before Use or Inhabitation		608
8. Tax		608
8.1 VAT and Sales Tax		608
8.2 Mitigation of Tax Liability		608
8.3 Municipal Taxes		609
8.4 Income Tax Withholding for Foreign Investors		609
8.5 Tax Benefits		609
1. General		615
1.1 Main Sources of Law		615
1.2 Main Market Trends and Deals		615
1.3 Proposals for Reform		616
2. Sale and Purchase		616
2.1 Categories of Property Rights		616
2.2 Laws Applicable to Transfer of Title		617
2.3 Effecting Lawful and Proper Transfer of Title		617
2.4 Real Estate Due Diligence		617
2.5 Typical Representations and Warranties		617
2.6 Important Areas of Law for Investors		617
2.7 Soil Pollution or Environmental Contamination		618
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		618
2.9 Condemnation, Expropriation or Compulsory Purchase		618
2.10 Taxes Applicable to a Transaction		619
2.11 Legal Restrictions on Foreign Investors		619
3. Real Estate Finance		619
3.1 Financing Acquisitions of Commercial Real Estate		619
3.2 Typical Security Created by Commercial Investors		619
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		620
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		620
3.5 Legal Requirements Before an Entity Can Give Valid Security		620
3.6 Formalities When a Borrower Is in Default		620
3.7 Subordinating Existing Debt to Newly Created Debt		621
3.8 Lenders’ Liability Under Environmental Laws		621
3.9 Effects of a Borrower Becoming Insolvent		621
3.10 Taxes on Loans		621
4. Planning and Zoning		621
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		621
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		621
4.3 Regulatory Authorities		622
4.4 Obtaining Entitlements to Develop a New Project		622
4.5 Right of Appeal Against an Authority’s Decision		622
4.6 Agreements With Local or Governmental Authorities		622
4.7 Enforcement of Restrictions on Development and Designated Use		622
5. Investment Vehicles		623
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		623
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		624
5.3 REITs		625
5.4 Minimum Capital Requirement		625
5.5 Applicable Governance Requirements		626
5.6 Annual Entity Maintenance and Accounting Compliance		628
6. Commercial Leases		628
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		628
6.2 Types of Commercial Leases		629
6.3 Regulation of Rents or Lease Terms		629
6.4 Typical Terms of a Lease		629
6.5 Rent Variation		629
6.6 Determination of New Rent		629
6.7 Payment of VAT		629
6.8 Costs Payable by a Tenant at the Start of a Lease		629
6.9 Payment of Maintenance and Repair		630
6.10 Payment of Utilities and Telecommunications		630
6.11 Payment of Property Taxes		630
6.12 Insurance Issues		630
6.13 Restrictions on the Use of Real Estate		630
6.14 Tenant’s Ability to Alter and Improve Real Estate		630
6.15 Specific Regulations		631
6.16 Effect of the Tenant’s Insolvency		631
6.17 Right to Occupy After Termination or Expiry of a Lease		631
6.18 Right to Assign a Leasehold Interest		631
6.19 Right to Terminate a Lease		632
6.20 Registration Requirements		632
6.21 Forced Eviction		632
6.22 Termination by a Third Party		632
6.23 Remedies/Damages for Breach		632
7. Construction		632
7.1 Common Structures Used to Price Construction Projects		632
7.2 Assigning Responsibility for the Design and Construction of a Project		633
7.3 Management of Construction Risk		633
7.4 Management of Schedule-Related Risk		633
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		633
7.6 Liens or Encumbrances in the Event of Non-Payment		633
7.7 Requirements Before Use or Inhabitation		633
8. Tax		634
8.1 VAT and Sales Tax		634
8.2 Mitigation of Tax Liability		634
8.3 Municipal Taxes		634
8.4 Income Tax Withholding for Foreign Investors		634
8.5 Tax Benefits		635
1. General		646
1.1 Main Sources of Law		646
1.2 Main Market Trends and Deals		646
1.3 Proposals for Reform		647
2. Sale and Purchase		648
2.1 Categories of Property Rights		648
2.2 Laws Applicable to Transfer of Title		648
2.3 Effecting Lawful and Proper Transfer of Title		648
2.4 Real Estate Due Diligence		649
2.5 Typical Representations and Warranties		649
2.6 Important Areas of Law for Investors		650
2.7 Soil Pollution or Environmental Contamination		650
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		651
2.9 Condemnation, Expropriation or Compulsory Purchase		651
2.10 Taxes Applicable to a Transaction		652
2.11 Legal Restrictions on Foreign Investors		652
3. Real Estate Finance		653
3.1 Financing Acquisitions of Commercial Real Estate		653
3.2 Typical Security Created by Commercial Investors		653
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		653
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		654
3.5 Legal Requirements Before an Entity Can Give Valid Security		654
3.6 Formalities When a Borrower Is in Default		654
3.7 Subordinating Existing Debt to Newly Created Debt		655
3.8 Lenders’ Liability Under Environmental Laws		655
3.9 Effects of a Borrower Becoming Insolvent		655
3.10 Taxes on Loans		655
4. Planning and Zoning		656
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		656
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		656
4.3 Regulatory Authorities		656
4.4 Obtaining Entitlements to Develop a New Project		656
4.5 Right of Appeal Against an Authority’s Decision		657
4.6 Agreements With Local or Governmental Authorities		657
4.7 Enforcement of Restrictions on Development and Designated Use		657
5. Investment Vehicles		657
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		657
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		657
5.3 REITs		658
5.4 Minimum Capital Requirement		658
5.5 Applicable Governance Requirements		658
5.6 Annual Entity Maintenance and Accounting Compliance		658
6. Commercial Leases		659
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		659
6.2 Types of Commercial Leases		659
6.3 Regulation of Rents or Lease Terms		660
6.4 Typical Terms of a Lease		660
6.5 Rent Variation		660
6.6 Determination of New Rent		660
6.7 Payment of VAT		660
6.8 Costs Payable by a Tenant at the Start of a Lease		660
6.9 Payment of Maintenance and Repair		660
6.10 Payment of Utilities and Telecommunications		661
6.11 Payment of Property Taxes		661
6.12 Insurance Issues		661
6.13 Restrictions on the Use of Real Estate		661
6.14 Tenant’s Ability to Alter and Improve Real Estate		661
6.15 Specific Regulations		661
6.16 Effect of the Tenant’s Insolvency		662
6.17 Right to Occupy After Termination or Expiry of a Lease		662
6.18 Right to Assign a Leasehold Interest		662
6.19 Right to Terminate a Lease		662
6.20 Registration Requirements		663
6.21 Forced Eviction		663
6.22 Termination by a Third Party		663
6.23 Remedies/Damages for Breach		664
7. Construction		664
7.1 Common Structures Used to Price Construction Projects		664
7.2 Assigning Responsibility for the Design and Construction of a Project		664
7.3 Management of Construction Risk		665
7.4 Management of Schedule-Related Risk		665
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		665
7.6 Liens or Encumbrances in the Event of Non-Payment		665
7.7 Requirements Before Use or Inhabitation		666
8. Tax		666
8.1 VAT and Sales Tax		666
8.2 Mitigation of Tax Liability		666
8.3 Municipal Taxes		666
8.4 Income Tax Withholding for Foreign Investors		666
8.5 Tax Benefits		666
1. General		672
1.1 Main Sources of Law		672
1.2 Main Market Trends and Deals		672
1.3 Proposals for Reform		673
2. Sale and Purchase		673
2.1 Categories of Property Rights		673
2.2 Laws Applicable to Transfer of Title		673
2.3 Effecting Lawful and Proper Transfer of Title		674
2.4 Real Estate Due Diligence		674
2.5 Typical Representations and Warranties		675
2.6 Important Areas of Law for Investors		676
2.7 Soil Pollution or Environmental Contamination		676
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		676
2.9 Condemnation, Expropriation or Compulsory Purchase		676
2.10 Taxes Applicable to a Transaction		677
2.11 Legal Restrictions on Foreign Investors		678
3. Real Estate Finance		678
3.1 Financing Acquisitions of Commercial Real Estate		678
3.2 Typical Security Created by Commercial Investors		678
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		678
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		679
3.5 Legal Requirements Before an Entity Can Give Valid Security		679
3.6 Formalities When a Borrower Is in Default		679
3.7 Subordinating Existing Debt to Newly Created Debt		679
3.8 Lenders’ Liability Under Environmental Laws		679
3.9 Effects of a Borrower Becoming Insolvent		680
3.10 Taxes on Loans		680
4. Planning and Zoning		680
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		680
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		680
4.3 Regulatory Authorities		680
4.4 Obtaining Entitlements to Develop a New Project		681
4.5 Right of Appeal Against an Authority’s Decision		681
4.6 Agreements With Local or Governmental Authorities		681
4.7 Enforcement of Restrictions on Development and Designated Use		681
5. Investment Vehicles		682
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		682
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		682
5.3 REITs		683
5.4 Minimum Capital Requirement		683
5.5 Applicable Governance Requirements		684
5.6 Annual Entity Maintenance and Accounting Compliance		684
6. Commercial Leases		684
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		684
6.2 Types of Commercial Leases		685
6.3 Regulation of Rents or Lease Terms		685
6.4 Typical Terms of a Lease		685
6.5 Rent Variation		685
6.6 Determination of New Rent		686
6.7 Payment of VAT		686
6.8 Costs Payable by a Tenant at the Start of a Lease		686
6.9 Payment of Maintenance and Repair		686
6.10 Payment of Utilities and Telecommunications		686
6.11 Payment of Property Taxes		686
6.12 Insurance Issues		686
6.13 Restrictions on the Use of Real Estate		686
6.14 Tenant’s Ability to Alter and Improve Real Estate		687
6.15 Specific Regulations		687
6.16 Effect of the Tenant’s Insolvency		687
6.17 Right to Occupy After Termination or Expiry of a Lease		687
6.18 Right to Assign a Leasehold Interest		687
6.19 Right to Terminate a Lease		688
6.20 Registration Requirements		688
6.21 Forced Eviction		688
6.22 Termination by a Third Party		688
6.23 Remedies/Damages for Breach		688
7. Construction		689
7.1 Common Structures Used to Price Construction Projects		689
7.2 Assigning Responsibility for the Design and Construction of a Project		689
7.3 Management of Construction Risk		689
7.4 Management of Schedule-Related Risk		690
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		691
7.6 Liens or Encumbrances in the Event of Non-Payment		691
7.7 Requirements Before Use or Inhabitation		691
8. Tax		691
8.1 VAT and Sales Tax		691
8.2 Mitigation of Tax Liability		691
8.3 Municipal Taxes		691
8.4 Income Tax Withholding for Foreign Investors		691
8.5 Tax Benefits		692
1. General		705
1.1 Main Sources of Law		705
1.2 Main Market Trends and Deals		706
1.3 Proposals for Reform		706
2. Sale and Purchase		707
2.1 Categories of Property Rights		707
2.2 Laws Applicable to Transfer of Title		708
2.3 Effecting Lawful and Proper Transfer of Title		708
2.4 Real Estate Due Diligence		708
2.5 Typical Representations and Warranties		708
2.6 Important Areas of Law for Investors		709
2.7 Soil Pollution or Environmental Contamination		709
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		709
2.9 Condemnation, Expropriation or Compulsory Purchase		709
2.10 Taxes Applicable to a Transaction		710
2.11 Legal Restrictions on Foreign Investors		710
3. Real Estate Finance		711
3.1 Financing Acquisitions of Commercial Real Estate		711
3.2 Typical Security Created by Commercial Investors		711
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		711
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		711
3.5 Legal Requirements Before an Entity Can Give Valid Security		712
3.6 Formalities When a Borrower Is in Default		712
3.7 Subordinating Existing Debt to Newly Created Debt		712
3.8 Lenders’ Liability Under Environmental Laws		712
3.9 Effects of a Borrower Becoming Insolvent		712
3.10 Taxes on Loans		713
4. Planning and Zoning		713
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		713
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		713
4.3 Regulatory Authorities		713
4.4 Obtaining Entitlements to Develop a New Project		713
4.5 Right of Appeal Against an Authority’s Decision		714
4.6 Agreements With Local or Governmental Authorities		714
4.7 Enforcement of Restrictions on Development and Designated Use		714
5. Investment Vehicles		714
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		714
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		714
5.3 REITs		716
5.4 Minimum Capital Requirement		716
5.5 Applicable Governance Requirements		717
5.6 Annual Entity Maintenance and Accounting Compliance		717
6. Commercial Leases		718
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		718
6.2 Types of Commercial Leases		718
6.3 Regulation of Rents or Lease Terms		718
6.4 Typical Terms of a Lease		718
6.5 Rent Variation		719
6.6 Determination of New Rent		719
6.7 Payment of VAT		719
6.8 Costs Payable by a Tenant at the Start of a Lease		720
6.9 Payment of Maintenance and Repair		720
6.10 Payment of Utilities and Telecommunications		720
6.11 Payment of Property Taxes		720
6.12 Insurance Issues		720
6.13 Restrictions on the Use of Real Estate		721
6.14 Tenant’s Ability to Alter and Improve Real Estate		721
6.15 Specific Regulations		721
6.16 Effect of the Tenant’s Insolvency		721
6.17 Right to Occupy After Termination or Expiry of a Lease		721
6.18 Right to Assign a Leasehold Interest		721
6.19 Right to Terminate a Lease		721
6.20 Registration Requirements		722
6.21 Forced Eviction		722
6.22 Termination by a Third Party		722
6.23 Remedies/Damages for Breach		722
7. Construction		722
7.1 Common Structures Used to Price Construction Projects		722
7.2 Assigning Responsibility for the Design and Construction of a Project		722
7.3 Management of Construction Risk		722
7.4 Management of Schedule-Related Risk		723
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		723
7.6 Liens or Encumbrances in the Event of Non-Payment		723
7.7 Requirements Before Use or Inhabitation		723
8. Tax		723
8.1 VAT and Sales Tax		723
8.2 Mitigation of Tax Liability		724
8.3 Municipal Taxes		724
8.4 Income Tax Withholding for Foreign Investors		725
8.5 Tax Benefits		726
1. General		732
1.1 Main Sources of Law		732
1.2 Main Market Trends and Deals		732
1.3 Proposals for Reform		732
2. Sale and Purchase		732
2.1 Categories of Property Rights		732
2.2 Laws Applicable to Transfer of Title		733
2.3 Effecting Lawful and Proper Transfer of Title		733
2.4 Real Estate Due Diligence		733
2.5 Typical Representations and Warranties		733
2.6 Important Areas of Law for Investors		734
2.7 Soil Pollution or Environmental Contamination		734
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		734
2.9 Condemnation, Expropriation or Compulsory Purchase		734
2.10 Taxes Applicable to a Transaction		734
2.11 Legal Restrictions on Foreign Investors		735
3. Real Estate Finance		735
3.1 Financing Acquisitions of Commercial Real Estate		735
3.2 Typical Security Created by Commercial Investors		735
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		736
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		736
3.5 Legal Requirements Before an Entity Can Give Valid Security		736
3.6 Formalities When a Borrower Is in Default		737
3.7 Subordinating Existing Debt to Newly Created Debt		737
3.8 Lenders’ Liability Under Environmental Laws		737
3.9 Effects of a Borrower Becoming Insolvent		738
3.10 Taxes on Loans		739
4. Planning and Zoning		739
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		739
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		739
4.3 Regulatory Authorities		739
4.4 Obtaining Entitlements to Develop a New Project		740
4.5 Right of Appeal Against an Authority’s Decision		740
4.6 Agreements With Local or Governmental Authorities		740
4.7 Enforcement of Restrictions on Development and Designated Use		740
5. Investment Vehicles		740
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		740
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		740
5.3 REITs		741
5.4 Minimum Capital Requirement		741
5.5 Applicable Governance Requirements		742
5.6 Annual Entity Maintenance and Accounting Compliance		743
6. Commercial Leases		743
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		743
6.2 Types of Commercial Leases		743
6.3 Regulation of Rents or Lease Terms		744
6.4 Typical Terms of a Lease		744
6.5 Rent Variation		744
6.6 Determination of New Rent		744
6.7 Payment of VAT		744
6.8 Costs Payable by a Tenant at the Start of a Lease		745
6.9 Payment of Maintenance and Repair		745
6.10 Payment of Utilities and Telecommunications		745
6.11 Payment of Property Taxes		745
6.12 Insurance Issues		745
6.13 Restrictions on the Use of Real Estate		745
6.14 Tenant’s Ability to Alter and Improve Real Estate		746
6.15 Specific Regulations		746
6.16 Effect of the Tenant’s Insolvency		746
6.17 Right to Occupy After Termination or Expiry of a Lease		746
6.18 Right to Assign a Leasehold Interest		746
6.19 Right to Terminate a Lease		746
6.20 Registration Requirements		747
6.21 Forced Eviction		747
6.22 Termination by a Third Party		747
6.23 Remedies/Damages for Breach		747
7. Construction		747
7.1 Common Structures Used to Price Construction Projects		747
7.2 Assigning Responsibility for the Design and Construction of a Project		747
7.3 Management of Construction Risk		747
7.4 Management of Schedule-Related Risk		747
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		748
7.6 Liens or Encumbrances in the Event of Non-Payment		748
7.7 Requirements Before Use or Inhabitation		748
8. Tax		748
8.1 VAT and Sales Tax		748
8.2 Mitigation of Tax Liability		748
8.3 Municipal Taxes		749
8.4 Income Tax Withholding for Foreign Investors		749
8.5 Tax Benefits		750
1. General		763
1.1 Main Sources of Law		763
1.2 Main Market Trends and Deals		763
1.3 Proposals for Reform		764
2. Sale and Purchase		765
2.1 Categories of Property Rights		765
2.2 Laws Applicable to Transfer of Title		765
2.3 Effecting Lawful and Proper Transfer of Title		765
2.4 Real Estate Due Diligence		766
2.5 Typical Representations and Warranties		766
2.6 Important Areas of Law for Investors		767
2.7 Soil Pollution or Environmental Contamination		767
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		767
2.9 Condemnation, Expropriation or Compulsory Purchase		768
2.10 Taxes Applicable to a Transaction		768
2.11 Legal Restrictions on Foreign Investors		768
3. Real Estate Finance		769
3.1 Financing Acquisitions of Commercial Real Estate		769
3.2 Typical Security Created by Commercial Investors		769
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		769
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		769
3.5 Legal Requirements Before an Entity Can Give Valid Security		770
3.6 Formalities When a Borrower Is in Default		770
3.7 Subordinating Existing Debt to Newly Created Debt		770
3.8 Lenders’ Liability Under Environmental Laws		770
3.9 Effects of a Borrower Becoming Insolvent		770
3.10 Taxes on Loans		770
4. Planning and Zoning		771
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		771
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		771
4.3 Regulatory Authorities		771
4.4 Obtaining Entitlements to Develop a New Project		772
4.5 Right of Appeal Against an Authority’s Decision		772
4.6 Agreements With Local or Governmental Authorities		772
4.7 Enforcement of Restrictions on Development and Designated Use		772
5. Investment Vehicles		772
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		772
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		773
5.3 REITs		773
5.4 Minimum Capital Requirement		773
5.5 Applicable Governance Requirements		773
5.6 Annual Entity Maintenance and Accounting Compliance		774
6. Commercial Leases		774
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		774
6.2 Types of Commercial Leases		774
6.3 Regulation of Rents or Lease Terms		774
6.4 Typical Terms of a Lease		774
6.5 Rent Variation		775
6.6 Determination of New Rent		775
6.7 Payment of VAT		775
6.8 Costs Payable by a Tenant at the Start of a Lease		776
6.9 Payment of Maintenance and Repair		776
6.10 Payment of Utilities and Telecommunications		776
6.11 Payment of Property Taxes		776
6.12 Insurance Issues		776
6.13 Restrictions on the Use of Real Estate		777
6.14 Tenant’s Ability to Alter and Improve Real Estate		777
6.15 Specific Regulations		777
6.16 Effect of the Tenant’s Insolvency		777
6.17 Right to Occupy After Termination or Expiry of a Lease		777
6.18 Right to Assign a Leasehold Interest		778
6.19 Right to Terminate a Lease		778
6.20 Registration Requirements		778
6.21 Forced Eviction		779
6.22 Termination by a Third Party		779
6.23 Remedies/Damages for Breach		779
7. Construction		779
7.1 Common Structures Used to Price Construction Projects		779
7.2 Assigning Responsibility for the Design and Construction of a Project		779
7.3 Management of Construction Risk		780
7.4 Management of Schedule-Related Risk		780
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		780
7.6 Liens or Encumbrances in the Event of Non-Payment		780
7.7 Requirements Before Use or Inhabitation		780
8. Tax		781
8.1 VAT and Sales Tax		781
8.2 Mitigation of Tax Liability		781
8.3 Municipal Taxes		781
8.4 Income Tax Withholding for Foreign Investors		781
8.5 Tax Benefits		782
1. General		787
1.1 Main Sources of Law		787
1.2 Main Market Trends and Deals		787
1.3 Proposals for Reform		787
2. Sale and Purchase		788
2.1 Categories of Property Rights		788
2.2 Laws Applicable to Transfer of Title		788
2.3 Effecting Lawful and Proper Transfer of Title		788
2.4 Real Estate Due Diligence		788
2.5 Typical Representations and Warranties		789
2.6 Important Areas of Law for Investors		789
2.7 Soil Pollution or Environmental Contamination		789
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		790
2.9 Condemnation, Expropriation or Compulsory Purchase		790
2.10 Taxes Applicable to a Transaction		790
2.11 Legal Restrictions on Foreign Investors		791
3. Real Estate Finance		791
3.1 Financing Acquisitions of Commercial Real Estate		791
3.2 Typical Security Created by Commercial Investors		791
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		791
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		791
3.5 Legal Requirements Before an Entity Can Give Valid Security		792
3.6 Formalities When a Borrower Is in Default		792
3.7 Subordinating Existing Debt to Newly Created Debt		792
3.8 Lenders’ Liability Under Environmental Laws		792
3.9 Effects of a Borrower Becoming Insolvent		792
3.10 Taxes on Loans		793
4. Planning and Zoning		793
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		793
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		793
4.3 Regulatory Authorities		793
4.4 Obtaining Entitlements to Develop a New Project		794
4.5 Right of Appeal Against an Authority’s Decision		794
4.6 Agreements With Local or Governmental Authorities		795
4.7 Enforcement of Restrictions on Development and Designated Use		795
5. Investment Vehicles		795
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		795
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		795
5.3 REITs		796
5.4 Minimum Capital Requirement		796
5.5 Applicable Governance Requirements		796
5.6 Annual Entity Maintenance and Accounting Compliance		797
6. Commercial Leases		797
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		797
6.2 Types of Commercial Leases		797
6.3 Regulation of Rents or Lease Terms		797
6.4 Typical Terms of a Lease		798
6.5 Rent Variation		798
6.6 Determination of New Rent		798
6.7 Payment of VAT		799
6.8 Costs Payable by a Tenant at the Start of a Lease		799
6.9 Payment of Maintenance and Repair		799
6.10 Payment of Utilities and Telecommunications		799
6.11 Payment of Property Taxes		799
6.12 Insurance Issues		800
6.13 Restrictions on the Use of Real Estate		800
6.14 Tenant’s Ability to Alter and Improve Real Estate		800
6.15 Specific Regulations		801
6.16 Effect of the Tenant’s Insolvency		801
6.17 Right to Occupy After Termination or Expiry of a Lease		801
6.18 Right to Assign a Leasehold Interest		801
6.19 Right to Terminate a Lease		802
6.20 Registration Requirements		802
6.21 Forced Eviction		802
6.22 Termination by a Third Party		803
6.23 Remedies/Damages for Breach		803
7. Construction		803
7.1 Common Structures Used to Price Construction Projects		803
7.2 Assigning Responsibility for the Design and Construction of a Project		803
7.3 Management of Construction Risk		804
7.4 Management of Schedule-Related Risk		804
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		804
7.6 Liens or Encumbrances in the Event of Non-Payment		804
7.7 Requirements Before Use or Inhabitation		805
8. Tax		805
8.1 VAT and Sales Tax		805
8.2 Mitigation of Tax Liability		805
8.3 Municipal Taxes		805
8.4 Income Tax Withholding for Foreign Investors		806
8.5 Tax Benefits		806
1. General		818
1.1 Main Sources of Law		818
1.2 Main Market Trends and Deals		818
1.3 Proposals for Reform		818
2. Sale and Purchase		818
2.1 Categories of Property Rights		818
2.2 Laws Applicable to Transfer of Title		819
2.3 Effecting Lawful and Proper Transfer of Title		819
2.4 Real Estate Due Diligence		819
2.5 Typical Representations and Warranties		819
2.6 Important Areas of Law for Investors		820
2.7 Soil Pollution or Environmental Contamination		820
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		820
2.9 Condemnation, Expropriation or Compulsory Purchase		820
2.10 Taxes Applicable to a Transaction		820
2.11 Legal Restrictions on Foreign Investors		821
3. Real Estate Finance		821
3.1 Financing Acquisitions of Commercial Real Estate		821
3.2 Typical Security Created by Commercial Investors		821
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		821
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		821
3.5 Legal Requirements Before an Entity Can Give Valid Security		822
3.6 Formalities When a Borrower Is in Default		822
3.7 Subordinating Existing Debt to Newly Created Debt		823
3.8 Lenders’ Liability Under Environmental Laws		823
3.9 Effects of a Borrower Becoming Insolvent		823
3.10 Taxes on Loans		823
4. Planning and Zoning		823
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		823
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		824
4.3 Regulatory Authorities		824
4.4 Obtaining Entitlements to Develop a New Project		825
4.5 Right of Appeal Against an Authority’s Decision		826
4.6 Agreements With Local or Governmental Authorities		826
4.7 Enforcement of Restrictions on Development and Designated Use		826
5. Investment Vehicles		827
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		827
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		827
5.3 REITs		827
5.4 Minimum Capital Requirement		828
5.5 Applicable Governance Requirements		828
5.6 Annual Entity Maintenance and Accounting Compliance		828
6. Commercial Leases		828
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		828
6.2 Types of Commercial Leases		828
6.3 Regulation of Rents or Lease Terms		828
6.4 Typical Terms of a Lease		828
6.5 Rent Variation		829
6.6 Determination of New Rent		829
6.7 Payment of VAT		829
6.8 Costs Payable by a Tenant at the Start of a Lease		829
6.9 Payment of Maintenance and Repair		829
6.10 Payment of Utilities and Telecommunications		829
6.11 Payment of Property Taxes		829
6.12 Insurance Issues		829
6.13 Restrictions on the Use of Real Estate		829
6.14 Tenant’s Ability to Alter and Improve Real Estate		829
6.15 Specific Regulations		830
6.16 Effect of the Tenant’s Insolvency		830
6.17 Right to Occupy After Termination or Expiry of a Lease		830
6.18 Right to Assign a Leasehold Interest		830
6.19 Right to Terminate a Lease		830
6.20 Registration Requirements		830
6.21 Forced Eviction		831
6.22 Termination by a Third Party		832
6.23 Remedies/Damages for Breach		832
7. Construction		832
7.1 Common Structures Used to Price Construction Projects		832
7.2 Assigning Responsibility for the Design and Construction of a Project		832
7.3 Management of Construction Risk		832
7.4 Management of Schedule-Related Risk		833
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		833
7.6 Liens or Encumbrances in the Event of Non-Payment		833
7.7 Requirements Before Use or Inhabitation		833
8. Tax		833
8.1 VAT and Sales Tax		833
8.2 Mitigation of Tax Liability		833
8.3 Municipal Taxes		833
8.4 Income Tax Withholding for Foreign Investors		834
8.5 Tax Benefits		834
1. General		839
1.1 Main Sources of Law		839
1.2 Main Market Trends and Deals		839
1.3 Proposals for Reform		840
2. Sale and Purchase		840
2.1 Categories of Property Rights		840
2.2 Laws Applicable to Transfer of Title		841
2.3 Effecting Lawful and Proper Transfer of Title		841
2.4 Real Estate Due Diligence		841
2.5 Typical Representations and Warranties		841
2.6 Important Areas of Law for Investors		842
2.7 Soil Pollution or Environmental Contamination		842
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		842
2.9 Condemnation, Expropriation or Compulsory Purchase		843
2.10 Taxes Applicable to a Transaction		843
2.11 Legal Restrictions on Foreign Investors		843
3. Real Estate Finance		843
3.1 Financing Acquisitions of Commercial Real Estate		843
3.2 Typical Security Created by Commercial Investors		843
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		844
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		844
3.5 Legal Requirements Before an Entity Can Give Valid Security		844
3.6 Formalities When a Borrower Is in Default		845
3.7 Subordinating Existing Debt to Newly Created Debt		845
3.8 Lenders’ Liability Under Environmental Laws		845
3.9 Effects of a Borrower Becoming Insolvent		845
3.10 Taxes on Loans		846
4. Planning and Zoning		846
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		846
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		846
4.3 Regulatory Authorities		847
4.4 Obtaining Entitlements to Develop a New Project		847
4.5 Right of Appeal Against an Authority’s Decision		848
4.6 Agreements With Local or Governmental Authorities		848
4.7 Enforcement of Restrictions on Development and Designated Use		848
5. Investment Vehicles		848
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		848
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		849
5.3 REITs		850
5.4 Minimum Capital Requirement		851
5.5 Applicable Governance Requirements		852
5.6 Annual Entity Maintenance and Accounting Compliance		852
6. Commercial Leases		852
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		852
6.2 Types of Commercial Leases		853
6.3 Regulation of Rents or Lease Terms		853
6.4 Typical Terms of a Lease		853
6.5 Rent Variation		853
6.6 Determination of New Rent		853
6.7 Payment of VAT		853
6.8 Costs Payable by a Tenant at the Start of a Lease		854
6.9 Payment of Maintenance and Repair		854
6.10 Payment of Utilities and Telecommunications		854
6.11 Payment of Property Taxes		854
6.12 Insurance Issues		854
6.13 Restrictions on the Use of Real Estate		854
6.14 Tenant’s Ability to Alter and Improve Real Estate		854
6.15 Specific Regulations		854
6.16 Effect of the Tenant’s Insolvency		855
6.17 Right to Occupy After Termination or Expiry of a Lease		855
6.18 Right to Assign a Leasehold Interest		855
6.19 Right to Terminate a Lease		855
6.20 Registration Requirements		856
6.21 Forced Eviction		856
6.22 Termination by a Third Party		856
6.23 Remedies/Damages for Breach		856
7. Construction		857
7.1 Common Structures Used to Price Construction Projects		857
7.2 Assigning Responsibility for the Design and Construction of a Project		857
7.3 Management of Construction Risk		857
7.4 Management of Schedule-Related Risk		858
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		858
7.6 Liens or Encumbrances in the Event of Non-Payment		858
7.7 Requirements Before Use or Inhabitation		858
8. Tax		858
8.1 VAT and Sales Tax		858
8.2 Mitigation of Tax Liability		859
8.3 Municipal Taxes		859
8.4 Income Tax Withholding for Foreign Investors		859
8.5 Tax Benefits		860
1. General		866
1.1 Main Sources of Law		866
1.2 Main Market Trends and Deals		866
1.3 Proposals for Reform		867
2. Sale and Purchase		868
2.1 Categories of Property Rights		868
2.2 Laws Applicable to Transfer of Title		868
2.3 Effecting Lawful and Proper Transfer of Title		868
2.4 Real Estate Due Diligence		868
2.5 Typical Representations and Warranties		869
2.6 Important Areas of Law for Investors		869
2.7 Soil Pollution or Environmental Contamination		869
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		870
2.9 Condemnation, Expropriation or Compulsory Purchase		870
2.10 Taxes Applicable to a Transaction		870
2.11 Legal Restrictions on Foreign Investors		872
3. Real Estate Finance		872
3.1 Financing Acquisitions of Commercial Real Estate		872
3.2 Typical Security Created by Commercial Investors		872
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		872
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		872
3.5 Legal Requirements Before an Entity Can Give Valid Security		873
3.6 Formalities When a Borrower Is in Default		873
3.7 Subordinating Existing Debt to Newly Created Debt		874
3.8 Lenders’ Liability Under Environmental Laws		874
3.9 Effects of a Borrower Becoming Insolvent		874
3.10 Taxes on Loans		874
4. Planning and Zoning		875
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		875
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		875
4.3 Regulatory Authorities		875
4.4 Obtaining Entitlements to Develop a New Project		875
4.5 Right of Appeal Against an Authority’s Decision		876
4.6 Agreements With Local or Governmental Authorities		876
4.7 Enforcement of Restrictions on Development and Designated Use		876
5. Investment Vehicles		876
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		876
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		876
5.3 REITs		876
5.4 Minimum Capital Requirement		877
5.5 Applicable Governance Requirements		877
5.6 Annual Entity Maintenance and Accounting Compliance		877
6. Commercial Leases		877
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		877
6.2 Types of Commercial Leases		877
6.3 Regulation of Rents or Lease Terms		877
6.4 Typical Terms of a Lease		878
6.5 Rent Variation		878
6.6 Determination of New Rent		878
6.7 Payment of VAT		878
6.8 Costs Payable by a Tenant at the Start of a Lease		878
6.9 Payment of Maintenance and Repair		878
6.10 Payment of Utilities and Telecommunications		878
6.11 Payment of Property Taxes		878
6.12 Insurance Issues		878
6.13 Restrictions on the Use of Real Estate		879
6.14 Tenant’s Ability to Alter and Improve Real Estate		879
6.15 Specific Regulations		879
6.16 Effect of the Tenant’s Insolvency		879
6.17 Right to Occupy After Termination or Expiry of a Lease		879
6.18 Right to Assign a Leasehold Interest		880
6.19 Right to Terminate a Lease		880
6.20 Registration Requirements		880
6.21 Forced Eviction		880
6.22 Termination by a Third Party		881
6.23 Remedies/Damages for Breach		881
7. Construction		881
7.1 Common Structures Used to Price Construction Projects		881
7.2 Assigning Responsibility for the Design and Construction of a Project		882
7.3 Management of Construction Risk		882
7.4 Management of Schedule-Related Risk		883
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		884
7.6 Liens or Encumbrances in the Event of Non-Payment		884
7.7 Requirements Before Use or Inhabitation		884
8. Tax		884
8.1 VAT and Sales Tax		884
8.2 Mitigation of Tax Liability		884
8.3 Municipal Taxes		885
8.4 Income Tax Withholding for Foreign Investors		885
8.5 Tax Benefits		885
1. General		898
1.1 Main Sources of Law		898
1.2 Main Market Trends and Deals		898
1.3 Proposals for Reform		899
2. Sale and Purchase		900
2.1 Categories of Property Rights		900
2.2 Laws Applicable to Transfer of Title		900
2.3 Effecting Lawful and Proper Transfer of Title		900
2.4 Real Estate Due Diligence		901
2.5 Typical Representations and Warranties		901
2.6 Important Areas of Law for Investors		902
2.7 Soil Pollution or Environmental Contamination		902
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		903
2.9 Condemnation, Expropriation or Compulsory Purchase		903
2.10 Taxes Applicable to a Transaction		903
2.11 Legal Restrictions on Foreign Investors		904
3. Real Estate Finance		904
3.1 Financing Acquisitions of Commercial Real Estate		904
3.2 Typical Security Created by Commercial Investors		904
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		905
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		905
3.5 Legal Requirements Before an Entity Can Give Valid Security		905
3.6 Formalities When a Borrower Is in Default		906
3.7 Subordinating Existing Debt to Newly Created Debt		906
3.8 Lenders’ Liability Under Environmental Laws		907
3.9 Effects of a Borrower Becoming Insolvent		907
3.10 Taxes on Loans		907
4. Planning and Zoning		907
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		907
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		908
4.3 Regulatory Authorities		908
4.4 Obtaining Entitlements to Develop a New Project		908
4.5 Right of Appeal Against an Authority’s Decision		908
4.6 Agreements With Local or Governmental Authorities		909
4.7 Enforcement of Restrictions on Development and Designated Use		909
5. Investment Vehicles		909
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		909
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		909
5.3 REITs		910
5.4 Minimum Capital Requirement		910
5.5 Applicable Governance Requirements		910
5.6 Annual Entity Maintenance and Accounting Compliance		910
6. Commercial Leases		910
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		910
6.2 Types of Commercial Leases		910
6.3 Regulation of Rents or Lease Terms		910
6.4 Typical Terms of a Lease		911
6.5 Rent Variation		911
6.6 Determination of New Rent		911
6.7 Payment of VAT		911
6.8 Costs Payable by a Tenant at the Start of a Lease		912
6.9 Payment of Maintenance and Repair		912
6.10 Payment of Utilities and Telecommunications		912
6.11 Payment of Property Taxes		912
6.12 Insurance Issues		912
6.13 Restrictions on the Use of Real Estate		913
6.14 Tenant’s Ability to Alter and Improve Real Estate		913
6.15 Specific Regulations		913
6.16 Effect of the Tenant’s Insolvency		913
6.17 Right to Occupy After Termination or Expiry of a Lease		913
6.18 Right to Assign a Leasehold Interest		914
6.19 Right to Terminate a Lease		914
6.20 Registration Requirements		914
6.21 Forced Eviction		915
6.22 Termination by a Third Party		915
6.23 Remedies/Damages for Breach		915
7. Construction		915
7.1 Common Structures Used to Price Construction Projects		915
7.2 Assigning Responsibility for the Design and Construction of a Project		916
7.3 Management of Construction Risk		916
7.4 Management of Schedule-Related Risk		916
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		916
7.6 Liens or Encumbrances in the Event of Non-Payment		917
7.7 Requirements Before Use or Inhabitation		917
8. Tax		917
8.1 VAT and Sales Tax		917
8.2 Mitigation of Tax Liability		918
8.3 Municipal Taxes		918
8.4 Income Tax Withholding for Foreign Investors		918
8.5 Tax Benefits		918
1. General		932
1.1 Main Sources of Law		932
1.2 Main Market Trends and Deals		932
1.3 Proposals for Reform		933
2. Sale and Purchase		934
2.1 Categories of Property Rights		934
2.2 Laws Applicable to Transfer of Title		934
2.3 Effecting Lawful and Proper Transfer of Title		934
2.4 Real Estate Due Diligence		934
2.5 Typical Representations and Warranties		934
2.6 Important Areas of Law for Investors		935
2.7 Soil Pollution or Environmental Contamination		935
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		935
2.9 Condemnation, Expropriation or Compulsory Purchase		935
2.10 Taxes Applicable to a Transaction		935
2.11 Legal Restrictions on Foreign Investors		936
3. Real Estate Finance		936
3.1 Financing Acquisitions of Commercial Real Estate		936
3.2 Typical Security Created by Commercial Investors		936
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		937
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		937
3.5 Legal Requirements Before an Entity Can Give Valid Security		937
3.6 Formalities When a Borrower Is in Default		938
3.7 Subordinating Existing Debt to Newly Created Debt		938
3.8 Lenders’ Liability Under Environmental Laws		938
3.9 Effects of a Borrower Becoming Insolvent		939
3.10 Taxes on Loans		939
4. Planning and Zoning		939
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		939
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		939
4.3 Regulatory Authorities		939
4.4 Obtaining Entitlements to Develop a New Project		940
4.5 Right of Appeal Against an Authority’s Decision		940
4.6 Agreements With Local or Governmental Authorities		941
4.7 Enforcement of Restrictions on Development and Designated Use		941
5. Investment Vehicles		941
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		941
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		941
5.3 REITs		942
5.4 Minimum Capital Requirement		942
5.5 Applicable Governance Requirements		943
5.6 Annual Entity Maintenance and Accounting Compliance		944
6. Commercial Leases		944
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		944
6.2 Types of Commercial Leases		945
6.3 Regulation of Rents or Lease Terms		945
6.4 Typical Terms of a Lease		945
6.5 Rent Variation		945
6.6 Determination of New Rent		945
6.7 Payment of VAT		946
6.8 Costs Payable by a Tenant at the Start of a Lease		946
6.9 Payment of Maintenance and Repair		946
6.10 Payment of Utilities and Telecommunications		946
6.11 Payment of Property Taxes		946
6.12 Insurance Issues		946
6.13 Restrictions on the Use of Real Estate		946
6.14 Tenant’s Ability to Alter and Improve Real Estate		947
6.15 Specific Regulations		947
6.16 Effect of the Tenant’s Insolvency		947
6.17 Right to Occupy After Termination or Expiry of a Lease		947
6.18 Right to Assign a Leasehold Interest		947
6.19 Right to Terminate a Lease		947
6.20 Registration Requirements		947
6.21 Forced Eviction		947
6.22 Termination by a Third Party		948
6.23 Remedies/Damages for Breach		948
7. Construction		948
7.1 Common Structures Used to Price Construction Projects		948
7.2 Assigning Responsibility for the Design and Construction of a Project		949
7.3 Management of Construction Risk		949
7.4 Management of Schedule-Related Risk		949
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		950
7.6 Liens or Encumbrances in the Event of Non-Payment		950
7.7 Requirements Before Use or Inhabitation		951
8. Tax		951
8.1 VAT and Sales Tax		951
8.2 Mitigation of Tax Liability		951
8.3 Municipal Taxes		951
8.4 Income Tax Withholding for Foreign Investors		951
8.5 Tax Benefits		952
1. General		957
1.1 Main Sources of Law		957
1.2 Main Market Trends and Deals		957
1.3 Proposals for Reform		958
2. Sale and Purchase		959
2.1 Categories of Property Rights		959
2.2 Laws Applicable to Transfer of Title		960
2.3 Effecting Lawful and Proper Transfer of Title		960
2.4 Real Estate Due Diligence		961
2.5 Typical Representations and Warranties		961
2.6 Important Areas of Law for Investors		961
2.7 Soil Pollution or Environmental Contamination		962
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		962
2.9 Condemnation, Expropriation or Compulsory Purchase		962
2.10 Taxes Applicable to a Transaction		963
2.11 Legal Restrictions on Foreign Investors		963
3. Real Estate Finance		963
3.1 Financing Acquisitions of Commercial Real Estate		963
3.2 Typical Security Created by Commercial Investors		963
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		964
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		964
3.5 Legal Requirements Before an Entity Can Give Valid Security		964
3.6 Formalities When a Borrower Is in Default		964
3.7 Subordinating Existing Debt to Newly Created Debt		965
3.8 Lenders’ Liability Under Environmental Laws		965
3.9 Effects of a Borrower Becoming Insolvent		965
3.10 Taxes on Loans		965
4. Planning and Zoning		965
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		965
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		965
4.3 Regulatory Authorities		965
4.4 Obtaining Entitlements to Develop a New Project		966
4.5 Right of Appeal Against an Authority’s Decision		966
4.6 Agreements With Local or Governmental Authorities		966
4.7 Enforcement of Restrictions on Development and Designated Use		966
5. Investment Vehicles		966
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		966
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		966
5.3 REITs		967
5.4 Minimum Capital Requirement		967
5.5 Applicable Governance Requirements		967
5.6 Annual Entity Maintenance and Accounting Compliance		967
6. Commercial Leases		967
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		967
6.2 Types of Commercial Leases		967
6.3 Regulation of Rents or Lease Terms		968
6.4 Typical Terms of a Lease		969
6.5 Rent Variation		969
6.6 Determination of New Rent		969
6.7 Payment of VAT		969
6.8 Costs Payable by a Tenant at the Start of a Lease		969
6.9 Payment of Maintenance and Repair		969
6.10 Payment of Utilities and Telecommunications		970
6.11 Payment of Property Taxes		970
6.12 Insurance Issues		970
6.13 Restrictions on the Use of Real Estate		970
6.14 Tenant’s Ability to Alter and Improve Real Estate		970
6.15 Specific Regulations		971
6.16 Effect of the Tenant’s Insolvency		971
6.17 Right to Occupy After Termination or Expiry of a Lease		971
6.18 Right to Assign a Leasehold Interest		971
6.19 Right to Terminate a Lease		972
6.20 Registration Requirements		972
6.21 Forced Eviction		972
6.22 Termination by a Third Party		974
6.23 Remedies/Damages for Breach		974
7. Construction		975
7.1 Common Structures Used to Price Construction Projects		975
7.2 Assigning Responsibility for the Design and Construction of a Project		975
7.3 Management of Construction Risk		975
7.4 Management of Schedule-Related Risk		976
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		976
7.6 Liens or Encumbrances in the Event of Non-Payment		976
7.7 Requirements Before Use or Inhabitation		976
8. Tax		976
8.1 VAT and Sales Tax		976
8.2 Mitigation of Tax Liability		976
8.3 Municipal Taxes		977
8.4 Income Tax Withholding for Foreign Investors		977
8.5 Tax Benefits		977
1. General		983
1.1 Main Sources of Law		983
1.2 Main Market Trends and Deals		983
1.3 Proposals for Reform		983
2. Sale and Purchase		983
2.1 Categories of Property Rights		983
2.2 Laws Applicable to Transfer of Title		983
2.3 Effecting Lawful and Proper Transfer of Title		983
2.4 Real Estate Due Diligence		983
2.5 Typical Representations and Warranties		984
2.6 Important Areas of Law for Investors		984
2.7 Soil Pollution or Environmental Contamination		984
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		984
2.9 Condemnation, Expropriation or Compulsory Purchase		984
2.10 Taxes Applicable to a Transaction		984
2.11 Legal Restrictions on Foreign Investors		985
3. Real Estate Finance		985
3.1 Financing Acquisitions of Commercial Real Estate		985
3.2 Typical Security Created by Commercial Investors		985
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		985
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		986
3.5 Legal Requirements Before an Entity Can Give Valid Security		986
3.6 Formalities When a Borrower Is in Default		986
3.7 Subordinating Existing Debt to Newly Created Debt		987
3.8 Lenders’ Liability Under Environmental Laws		987
3.9 Effects of a Borrower Becoming Insolvent		987
3.10 Taxes on Loans		987
4. Planning and Zoning		987
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		987
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		987
4.3 Regulatory Authorities		987
4.4 Obtaining Entitlements to Develop a New Project		988
4.5 Right of Appeal Against an Authority’s Decision		988
4.6 Agreements With Local or Governmental Authorities		988
4.7 Enforcement of Restrictions on Development and Designated Use		988
5. Investment Vehicles		988
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		988
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		989
5.3 REITs		989
5.4 Minimum Capital Requirement		989
5.5 Applicable Governance Requirements		989
5.6 Annual Entity Maintenance and Accounting Compliance		989
6. Commercial Leases		989
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		989
6.2 Types of Commercial Leases		990
6.3 Regulation of Rents or Lease Terms		990
6.4 Typical Terms of a Lease		990
6.5 Rent Variation		990
6.6 Determination of New Rent		990
6.7 Payment of VAT		990
6.8 Costs Payable by a Tenant at the Start of a Lease		990
6.9 Payment of Maintenance and Repair		990
6.10 Payment of Utilities and Telecommunications		991
6.11 Payment of Property Taxes		991
6.12 Insurance Issues		991
6.13 Restrictions on the Use of Real Estate		991
6.14 Tenant’s Ability to Alter and Improve Real Estate		991
6.15 Specific Regulations		991
6.16 Effect of the Tenant’s Insolvency		991
6.17 Right to Occupy After Termination or Expiry of a Lease		991
6.18 Right to Assign a Leasehold Interest		992
6.19 Right to Terminate a Lease		992
6.20 Registration Requirements		992
6.21 Forced Eviction		992
6.22 Termination by a Third Party		992
6.23 Remedies/Damages for Breach		992
7. Construction		993
7.1 Common Structures Used to Price Construction Projects		993
7.2 Assigning Responsibility for the Design and Construction of a Project		993
7.3 Management of Construction Risk		993
7.4 Management of Schedule-Related Risk		993
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		994
7.6 Liens or Encumbrances in the Event of Non-Payment		994
7.7 Requirements Before Use or Inhabitation		994
8. Tax		994
8.1 VAT and Sales Tax		994
8.2 Mitigation of Tax Liability		995
8.3 Municipal Taxes		995
8.4 Income Tax Withholding for Foreign Investors		995
8.5 Tax Benefits		997
1. General		1002
1.1 Main Sources of Law		1002
1.2 Main Market Trends and Deals		1002
1.3 Proposals for Reform		1003
2. Sale and Purchase		1003
2.1 Categories of Property Rights		1003
2.2 Laws Applicable to Transfer of Title		1004
2.3 Effecting Lawful and Proper Transfer of Title		1004
2.4 Real Estate Due Diligence		1004
2.5 Typical Representations and Warranties		1005
2.6 Important Areas of Law for Investors		1005
2.7 Soil Pollution or Environmental Contamination		1006
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1006
2.9 Condemnation, Expropriation or Compulsory Purchase		1007
2.10 Taxes Applicable to a Transaction		1007
2.11 Legal Restrictions on Foreign Investors		1008
3. Real Estate Finance		1008
3.1 Financing Acquisitions of Commercial Real Estate		1008
3.2 Typical Security Created by Commercial Investors		1008
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1009
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1009
3.5 Legal Requirements Before an Entity Can Give Valid Security		1009
3.6 Formalities When a Borrower Is in Default		1010
3.7 Subordinating Existing Debt to Newly Created Debt		1010
3.8 Lenders’ Liability Under Environmental Laws		1010
3.9 Effects of a Borrower Becoming Insolvent		1010
3.10 Taxes on Loans		1011
4. Planning and Zoning		1011
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1011
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1011
4.3 Regulatory Authorities		1011
4.4 Obtaining Entitlements to Develop a New Project		1011
4.5 Right of Appeal Against an Authority’s Decision		1012
4.6 Agreements With Local or Governmental Authorities		1012
4.7 Enforcement of Restrictions on Development and Designated Use		1012
5. Investment Vehicles		1013
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1013
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1013
5.3 REITs		1013
5.4 Minimum Capital Requirement		1013
5.5 Applicable Governance Requirements		1014
5.6 Annual Entity Maintenance and Accounting Compliance		1014
6. Commercial Leases		1014
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1014
6.2 Types of Commercial Leases		1015
6.3 Regulation of Rents or Lease Terms		1015
6.4 Typical Terms of a Lease		1015
6.5 Rent Variation		1016
6.6 Determination of New Rent		1016
6.7 Payment of VAT		1016
6.8 Costs Payable by a Tenant at the Start of a Lease		1016
6.9 Payment of Maintenance and Repair		1016
6.10 Payment of Utilities and Telecommunications		1016
6.11 Payment of Property Taxes		1017
6.12 Insurance Issues		1017
6.13 Restrictions on the Use of Real Estate		1017
6.14 Tenant’s Ability to Alter and Improve Real Estate		1017
6.15 Specific Regulations		1017
6.16 Effect of the Tenant’s Insolvency		1017
6.17 Right to Occupy After Termination or Expiry of a Lease		1018
6.18 Right to Assign a Leasehold Interest		1018
6.19 Right to Terminate a Lease		1018
6.20 Registration Requirements		1018
6.21 Forced Eviction		1018
6.22 Termination by a Third Party		1019
6.23 Remedies/Damages for Breach		1019
7. Construction		1019
7.1 Common Structures Used to Price Construction Projects		1019
7.2 Assigning Responsibility for the Design and Construction of a Project		1019
7.3 Management of Construction Risk		1020
7.4 Management of Schedule-Related Risk		1020
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1020
7.6 Liens or Encumbrances in the Event of Non-Payment		1020
7.7 Requirements Before Use or Inhabitation		1020
8. Tax		1021
8.1 VAT and Sales Tax		1021
8.2 Mitigation of Tax Liability		1021
8.3 Municipal Taxes		1021
8.4 Income Tax Withholding for Foreign Investors		1021
8.5 Tax Benefits		1022
1. General		1027
1.1 Main Sources of Law		1027
1.2 Main Market Trends and Deals		1027
1.3 Proposals for Reform		1030
2. Sale and Purchase		1030
2.1 Categories of Property Rights		1030
2.2 Laws Applicable to Transfer of Title		1031
2.3 Effecting Lawful and Proper Transfer of Title		1031
2.4 Real Estate Due Diligence		1032
2.5 Typical Representations and Warranties		1032
2.6 Important Areas of Law for Investors		1032
2.7 Soil Pollution or Environmental Contamination		1033
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1033
2.9 Condemnation, Expropriation or Compulsory Purchase		1033
2.10 Taxes Applicable to a Transaction		1033
2.11 Legal Restrictions on Foreign Investors		1034
3. Real Estate Finance		1034
3.1 Financing Acquisitions of Commercial Real Estate		1034
3.2 Typical Security Created by Commercial Investors		1034
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1035
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1035
3.5 Legal Requirements Before an Entity Can Give Valid Security		1035
3.6 Formalities When a Borrower Is in Default		1035
3.7 Subordinating Existing Debt to Newly Created Debt		1036
3.8 Lenders’ Liability Under Environmental Laws		1036
3.9 Effects of a Borrower Becoming Insolvent		1036
3.10 Taxes on Loans		1037
4. Planning and Zoning		1037
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1037
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1037
4.3 Regulatory Authorities		1037
4.4 Obtaining Entitlements to Develop a New Project		1038
4.5 Right of Appeal Against an Authority’s Decision		1038
4.6 Agreements With Local or Governmental Authorities		1038
4.7 Enforcement of Restrictions on Development and Designated Use		1039
5. Investment Vehicles		1039
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1039
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1039
5.3 REITs		1039
5.4 Minimum Capital Requirement		1039
5.5 Applicable Governance Requirements		1039
5.6 Annual Entity Maintenance and Accounting Compliance		1040
6. Commercial Leases		1040
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1040
6.2 Types of Commercial Leases		1040
6.3 Regulation of Rents or Lease Terms		1040
6.4 Typical Terms of a Lease		1041
6.5 Rent Variation		1041
6.6 Determination of New Rent		1041
6.7 Payment of VAT		1041
6.8 Costs Payable by a Tenant at the Start of a Lease		1041
6.9 Payment of Maintenance and Repair		1041
6.10 Payment of Utilities and Telecommunications		1041
6.11 Payment of Property Taxes		1042
6.12 Insurance Issues		1042
6.13 Restrictions on the Use of Real Estate		1042
6.14 Tenant’s Ability to Alter and Improve Real Estate		1042
6.15 Specific Regulations		1043
6.16 Effect of the Tenant’s Insolvency		1043
6.17 Right to Occupy After Termination or Expiry of a Lease		1043
6.18 Right to Assign a Leasehold Interest		1043
6.19 Right to Terminate a Lease		1043
6.20 Registration Requirements		1044
6.21 Forced Eviction		1044
6.22 Termination by a Third Party		1044
6.23 Remedies/Damages for Breach		1044
7. Construction		1045
7.1 Common Structures Used to Price Construction Projects		1045
7.2 Assigning Responsibility for the Design and Construction of a Project		1045
7.3 Management of Construction Risk		1045
7.4 Management of Schedule-Related Risk		1045
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1045
7.6 Liens or Encumbrances in the Event of Non-Payment		1046
7.7 Requirements Before Use or Inhabitation		1046
8. Tax		1046
8.1 VAT and Sales Tax		1046
8.2 Mitigation of Tax Liability		1046
8.3 Municipal Taxes		1046
8.4 Income Tax Withholding for Foreign Investors		1046
8.5 Tax Benefits		1047
1. General		1052
1.1 Main Sources of Law		1052
1.2 Main Market Trends and Deals		1052
1.3 Proposals for Reform		1053
2. Sale and Purchase		1053
2.1 Categories of Property Rights		1053
2.2 Laws Applicable to Transfer of Title		1053
2.3 Effecting Lawful and Proper Transfer of Title		1053
2.4 Real Estate Due Diligence		1053
2.5 Typical Representations and Warranties		1053
2.6 Important Areas of Law for Investors		1054
2.7 Soil Pollution or Environmental Contamination		1054
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1054
2.9 Condemnation, Expropriation or Compulsory Purchase		1054
2.10 Taxes Applicable to a Transaction		1054
2.11 Legal Restrictions on Foreign Investors		1056
3. Real Estate Finance		1056
3.1 Financing Acquisitions of Commercial Real Estate		1056
3.2 Typical Security Created by Commercial Investors		1056
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1056
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1056
3.5 Legal Requirements Before an Entity Can Give Valid Security		1057
3.6 Formalities When a Borrower Is in Default		1057
3.7 Subordinating Existing Debt to Newly Created Debt		1058
3.8 Lenders’ Liability Under Environmental Laws		1058
3.9 Effects of a Borrower Becoming Insolvent		1058
3.10 Taxes on Loans		1058
4. Planning and Zoning		1058
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1058
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1059
4.3 Regulatory Authorities		1059
4.4 Obtaining Entitlements to Develop a New Project		1059
4.5 Right of Appeal Against an Authority’s Decision		1059
4.6 Agreements With Local or Governmental Authorities		1059
4.7 Enforcement of Restrictions on Development and Designated Use		1059
5. Investment Vehicles		1060
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1060
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1060
5.3 REITs		1060
5.4 Minimum Capital Requirement		1060
5.5 Applicable Governance Requirements		1060
5.6 Annual Entity Maintenance and Accounting Compliance		1060
6. Commercial Leases		1060
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1060
6.2 Types of Commercial Leases		1060
6.3 Regulation of Rents or Lease Terms		1060
6.4 Typical Terms of a Lease		1060
6.5 Rent Variation		1061
6.6 Determination of New Rent		1061
6.7 Payment of VAT		1061
6.8 Costs Payable by a Tenant at the Start of a Lease		1061
6.9 Payment of Maintenance and Repair		1061
6.10 Payment of Utilities and Telecommunications		1061
6.11 Payment of Property Taxes		1061
6.12 Insurance Issues		1061
6.13 Restrictions on the Use of Real Estate		1061
6.14 Tenant’s Ability to Alter and Improve Real Estate		1061
6.15 Specific Regulations		1061
6.16 Effect of the Tenant’s Insolvency		1061
6.17 Right to Occupy After Termination or Expiry of a Lease		1062
6.18 Right to Assign a Leasehold Interest		1062
6.19 Right to Terminate a Lease		1062
6.20 Registration Requirements		1062
6.21 Forced Eviction		1063
6.22 Termination by a Third Party		1063
6.23 Remedies/Damages for Breach		1063
7. Construction		1063
7.1 Common Structures Used to Price Construction Projects		1063
7.2 Assigning Responsibility for the Design and Construction of a Project		1063
7.3 Management of Construction Risk		1063
7.4 Management of Schedule-Related Risk		1063
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1063
7.6 Liens or Encumbrances in the Event of Non-Payment		1063
7.7 Requirements Before Use or Inhabitation		1063
8. Tax		1064
8.1 VAT and Sales Tax		1064
8.2 Mitigation of Tax Liability		1064
8.3 Municipal Taxes		1064
8.4 Income Tax Withholding for Foreign Investors		1064
8.5 Tax Benefits		1064
1. General		1073
1.1 Main Sources of Law		1073
1.2 Main Market Trends and Deals		1073
1.3 Proposals for Reform		1073
2. Sale and Purchase		1073
2.1 Categories of Property Rights		1073
2.2 Laws Applicable to Transfer of Title		1074
2.3 Effecting Lawful and Proper Transfer of Title		1074
2.4 Real Estate Due Diligence		1075
2.5 Typical Representations and Warranties		1075
2.6 Important Areas of Law for Investors		1075
2.7 Soil Pollution or Environmental Contamination		1075
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1075
2.9 Condemnation, Expropriation or Compulsory Purchase		1076
2.10 Taxes Applicable to a Transaction		1076
2.11 Legal Restrictions on Foreign Investors		1077
3. Real Estate Finance		1077
3.1 Financing Acquisitions of Commercial Real Estate		1077
3.2 Typical Security Created by Commercial Investors		1078
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1078
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1079
3.5 Legal Requirements Before an Entity Can Give Valid Security		1079
3.6 Formalities When a Borrower Is in Default		1079
3.7 Subordinating Existing Debt to Newly Created Debt		1079
3.8 Lenders’ Liability Under Environmental Laws		1080
3.9 Effects of a Borrower Becoming Insolvent		1080
3.10 Taxes on Loans		1080
4. Planning and Zoning		1080
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1080
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1081
4.3 Regulatory Authorities		1082
4.4 Obtaining Entitlements to Develop a New Project		1082
4.5 Right of Appeal Against an Authority’s Decision		1082
4.6 Agreements With Local or Governmental Authorities		1082
4.7 Enforcement of Restrictions on Development and Designated Use		1082
5. Investment Vehicles		1083
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1083
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1083
5.3 REITs		1084
5.4 Minimum Capital Requirement		1084
5.5 Applicable Governance Requirements		1084
5.6 Annual Entity Maintenance and Accounting Compliance		1085
6. Commercial Leases		1085
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1085
6.2 Types of Commercial Leases		1085
6.3 Regulation of Rents or Lease Terms		1085
6.4 Typical Terms of a Lease		1086
6.5 Rent Variation		1086
6.6 Determination of New Rent		1086
6.7 Payment of VAT		1086
6.8 Costs Payable by a Tenant at the Start of a Lease		1086
6.9 Payment of Maintenance and Repair		1086
6.10 Payment of Utilities and Telecommunications		1086
6.11 Payment of Property Taxes		1087
6.12 Insurance Issues		1087
6.13 Restrictions on the Use of Real Estate		1087
6.14 Tenant’s Ability to Alter and Improve Real Estate		1087
6.15 Specific Regulations		1087
6.16 Effect of the Tenant’s Insolvency		1088
6.17 Right to Occupy After Termination or Expiry of a Lease		1088
6.18 Right to Assign a Leasehold Interest		1088
6.19 Right to Terminate a Lease		1088
6.20 Registration Requirements		1088
6.21 Forced Eviction		1089
6.22 Termination by a Third Party		1089
6.23 Remedies/Damages for Breach		1089
7. Construction		1090
7.1 Common Structures Used to Price Construction Projects		1090
7.2 Assigning Responsibility for the Design and Construction of a Project		1090
7.3 Management of Construction Risk		1090
7.4 Management of Schedule-Related Risk		1090
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1091
7.6 Liens or Encumbrances in the Event of Non-Payment		1091
7.7 Requirements Before Use or Inhabitation		1091
8. Tax		1092
8.1 VAT and Sales Tax		1092
8.2 Mitigation of Tax Liability		1092
8.3 Municipal Taxes		1092
8.4 Income Tax Withholding for Foreign Investors		1092
8.5 Tax Benefits		1092
1. General		1098
1.1 Main Sources of Law		1098
1.2 Main Market Trends and Deals		1098
1.3 Proposals for Reform		1099
2. Sale and Purchase		1099
2.1 Categories of Property Rights		1099
2.2 Laws Applicable to Transfer of Title		1099
2.3 Effecting Lawful and Proper Transfer of Title		1100
2.4 Real Estate Due Diligence		1100
2.5 Typical Representations and Warranties		1100
2.6 Important Areas of Law for Investors		1101
2.7 Soil Pollution or Environmental Contamination		1101
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1102
2.9 Condemnation, Expropriation or Compulsory Purchase		1102
2.10 Taxes Applicable to a Transaction		1102
2.11 Legal Restrictions on Foreign Investors		1102
3. Real Estate Finance		1103
3.1 Financing Acquisitions of Commercial Real Estate		1103
3.2 Typical Security Created by Commercial Investors		1103
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1103
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1104
3.5 Legal Requirements Before an Entity Can Give Valid Security		1104
3.6 Formalities When a Borrower Is in Default		1104
3.7 Subordinating Existing Debt to Newly Created Debt		1104
3.8 Lenders’ Liability Under Environmental Laws		1104
3.9 Effects of a Borrower Becoming Insolvent		1105
3.10 Taxes on Loans		1105
4. Planning and Zoning		1105
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1105
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1105
4.3 Regulatory Authorities		1105
4.4 Obtaining Entitlements to Develop a New Project		1106
4.5 Right of Appeal Against an Authority’s Decision		1106
4.6 Agreements With Local or Governmental Authorities		1106
4.7 Enforcement of Restrictions on Development and Designated Use		1106
5. Investment Vehicles		1106
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1106
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1107
5.3 REITs		1107
5.4 Minimum Capital Requirement		1108
5.5 Applicable Governance Requirements		1108
5.6 Annual Entity Maintenance and Accounting Compliance		1108
6. Commercial Leases		1109
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1109
6.2 Types of Commercial Leases		1110
6.3 Regulation of Rents or Lease Terms		1110
6.4 Typical Terms of a Lease		1110
6.5 Rent Variation		1111
6.6 Determination of New Rent		1111
6.7 Payment of VAT		1112
6.8 Costs Payable by a Tenant at the Start of a Lease		1112
6.9 Payment of Maintenance and Repair		1112
6.10 Payment of Utilities and Telecommunications		1112
6.11 Payment of Property Taxes		1112
6.12 Insurance Issues		1113
6.13 Restrictions on the Use of Real Estate		1113
6.14 Tenant’s Ability to Alter and Improve Real Estate		1113
6.15 Specific Regulations		1113
6.16 Effect of the Tenant’s Insolvency		1114
6.17 Right to Occupy After Termination or Expiry of a Lease		1114
6.18 Right to Assign a Leasehold Interest		1114
6.19 Right to Terminate a Lease		1115
6.20 Registration Requirements		1115
6.21 Forced Eviction		1115
6.22 Termination by a Third Party		1115
6.23 Remedies/Damages for Breach		1115
7. Construction		1116
7.1 Common Structures Used to Price Construction Projects		1116
7.2 Assigning Responsibility for the Design and Construction of a Project		1116
7.3 Management of Construction Risk		1117
7.4 Management of Schedule-Related Risk		1117
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1118
7.6 Liens or Encumbrances in the Event of Non-Payment		1118
7.7 Requirements Before Use or Inhabitation		1118
8. Tax		1119
8.1 VAT and Sales Tax		1119
8.2 Mitigation of Tax Liability		1119
8.3 Municipal Taxes		1119
8.4 Income Tax Withholding for Foreign Investors		1119
8.5 Tax Benefits		1120
1. General		1126
1.1 Main Sources of Law		1126
1.2 Main Market Trends and Deals		1126
1.3 Proposals for Reform		1127
2. Sale and Purchase		1128
2.1 Categories of Property Rights		1128
2.2 Laws Applicable to Transfer of Title		1129
2.3 Effecting Lawful and Proper Transfer of Title		1129
2.4 Real Estate Due Diligence		1129
2.5 Typical Representations and Warranties		1130
2.6 Important Areas of Law for Investors		1130
2.7 Soil Pollution or Environmental Contamination		1130
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1130
2.9 Condemnation, Expropriation or Compulsory Purchase		1131
2.10 Taxes Applicable to a Transaction		1131
2.11 Legal Restrictions on Foreign Investors		1131
3. Real Estate Finance		1131
3.1 Financing Acquisitions of Commercial Real Estate		1131
3.2 Typical Security Created by Commercial Investors		1131
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1132
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1132
3.5 Legal Requirements Before an Entity Can Give Valid Security		1132
3.6 Formalities When a Borrower Is in Default		1132
3.7 Subordinating Existing Debt to Newly Created Debt		1132
3.8 Lenders’ Liability Under Environmental Laws		1132
3.9 Effects of a Borrower Becoming Insolvent		1133
3.10 Taxes on Loans		1134
4. Planning and Zoning		1134
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1134
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1134
4.3 Regulatory Authorities		1134
4.4 Obtaining Entitlements to Develop a New Project		1134
4.5 Right of Appeal Against an Authority’s Decision		1135
4.6 Agreements With Local or Governmental Authorities		1135
4.7 Enforcement of Restrictions on Development and Designated Use		1135
5. Investment Vehicles		1135
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1135
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1136
5.3 REITs		1137
5.4 Minimum Capital Requirement		1137
5.5 Applicable Governance Requirements		1137
5.6 Annual Entity Maintenance and Accounting Compliance		1138
6. Commercial Leases		1138
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1138
6.2 Types of Commercial Leases		1138
6.3 Regulation of Rents or Lease Terms		1139
6.4 Typical Terms of a Lease		1139
6.5 Rent Variation		1139
6.6 Determination of New Rent		1139
6.7 Payment of VAT		1139
6.8 Costs Payable by a Tenant at the Start of a Lease		1139
6.9 Payment of Maintenance and Repair		1139
6.10 Payment of Utilities and Telecommunications		1140
6.11 Payment of Property Taxes		1140
6.12 Insurance Issues		1140
6.13 Restrictions on the Use of Real Estate		1140
6.14 Tenant’s Ability to Alter and Improve Real Estate		1140
6.15 Specific Regulations		1140
6.16 Effect of the Tenant’s Insolvency		1141
6.17 Right to Occupy After Termination or Expiry of a Lease		1141
6.18 Right to Assign a Leasehold Interest		1141
6.19 Right to Terminate a Lease		1141
6.20 Registration Requirements		1142
6.21 Forced Eviction		1142
6.22 Termination by a Third Party		1143
6.23 Remedies/Damages for Breach		1143
7. Construction		1143
7.1 Common Structures Used to Price Construction Projects		1143
7.2 Assigning Responsibility for the Design and Construction of a Project		1143
7.3 Management of Construction Risk		1144
7.4 Management of Schedule-Related Risk		1144
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1144
7.6 Liens or Encumbrances in the Event of Non-Payment		1144
7.7 Requirements Before Use or Inhabitation		1145
8. Tax		1145
8.1 VAT and Sales Tax		1145
8.2 Mitigation of Tax Liability		1146
8.3 Municipal Taxes		1146
8.4 Income Tax Withholding for Foreign Investors		1146
8.5 Tax Benefits		1146
1. General		1161
1.1 Main Sources of Law		1161
1.2 Main Market Trends and Deals		1161
1.3 Proposals for Reform		1161
2. Sale and Purchase		1161
2.1 Categories of Property Rights		1161
2.2 Laws Applicable to Transfer of Title		1161
2.3 Effecting Lawful and Proper Transfer of Title		1161
2.4 Real Estate Due Diligence		1162
2.5 Typical Representations and Warranties		1163
2.6 Important Areas of Law for Investors		1163
2.7 Soil Pollution or Environmental Contamination		1163
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1164
2.9 Condemnation, Expropriation or Compulsory Purchase		1164
2.10 Taxes Applicable to a Transaction		1164
2.11 Legal Restrictions on Foreign Investors		1165
3. Real Estate Finance		1165
3.1 Financing Acquisitions of Commercial Real Estate		1165
3.2 Typical Security Created by Commercial Investors		1165
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1166
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1166
3.5 Legal Requirements Before an Entity Can Give Valid Security		1166
3.6 Formalities When a Borrower Is in Default		1166
3.7 Subordinating Existing Debt to Newly Created Debt		1167
3.8 Lenders’ Liability Under Environmental Laws		1168
3.9 Effects of a Borrower Becoming Insolvent		1168
3.10 Taxes on Loans		1168
4. Planning and Zoning		1168
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1168
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1168
4.3 Regulatory Authorities		1169
4.4 Obtaining Entitlements to Develop a New Project		1169
4.5 Right of Appeal Against an Authority’s Decision		1170
4.6 Agreements With Local or Governmental Authorities		1170
4.7 Enforcement of Restrictions on Development and Designated Use		1170
5. Investment Vehicles		1171
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1171
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1171
5.3 REITs		1173
5.4 Minimum Capital Requirement		1173
5.5 Applicable Governance Requirements		1173
5.6 Annual Entity Maintenance and Accounting Compliance		1173
6. Commercial Leases		1173
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1173
6.2 Types of Commercial Leases		1173
6.3 Regulation of Rents or Lease Terms		1174
6.4 Typical Terms of a Lease		1174
6.5 Rent Variation		1174
6.6 Determination of New Rent		1175
6.7 Payment of VAT		1175
6.8 Costs Payable by a Tenant at the Start of a Lease		1175
6.9 Payment of Maintenance and Repair		1175
6.10 Payment of Utilities and Telecommunications		1175
6.11 Payment of Property Taxes		1175
6.12 Insurance Issues		1175
6.13 Restrictions on the Use of Real Estate		1176
6.14 Tenant’s Ability to Alter and Improve Real Estate		1176
6.15 Specific Regulations		1176
6.16 Effect of the Tenant’s Insolvency		1176
6.17 Right to Occupy After Termination or Expiry of a Lease		1176
6.18 Right to Assign a Leasehold Interest		1176
6.19 Right to Terminate a Lease		1177
6.20 Registration Requirements		1177
6.21 Forced Eviction		1177
6.22 Termination by a Third Party		1177
6.23 Remedies/Damages for Breach		1178
7. Construction		1178
7.1 Common Structures Used to Price Construction Projects		1178
7.2 Assigning Responsibility for the Design and Construction of a Project		1178
7.3 Management of Construction Risk		1178
7.4 Management of Schedule-Related Risk		1179
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1179
7.6 Liens or Encumbrances in the Event of Non-Payment		1179
7.7 Requirements Before Use or Inhabitation		1179
8. Tax		1180
8.1 VAT and Sales Tax		1180
8.2 Mitigation of Tax Liability		1180
8.3 Municipal Taxes		1180
8.4 Income Tax Withholding for Foreign Investors		1180
8.5 Tax Benefits		1180
1. General		1194
1.1 Main Sources of Law		1194
1.2 Main Market Trends and Deals		1194
1.3 Proposals for Reform		1194
2. Sale and Purchase		1195
2.1 Categories of Property Rights		1195
2.2 Laws Applicable to Transfer of Title		1195
2.3 Effecting Lawful and Proper Transfer of Title		1195
2.4 Real Estate Due Diligence		1195
2.5 Typical Representations and Warranties		1196
2.6 Important Areas of Law for Investors		1196
2.7 Soil Pollution or Environmental Contamination		1196
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1197
2.9 Condemnation, Expropriation or Compulsory Purchase		1197
2.10 Taxes Applicable to a Transaction		1197
2.11 Legal Restrictions on Foreign Investors		1198
3. Real Estate Finance		1198
3.1 Financing Acquisitions of Commercial Real Estate		1198
3.2 Typical Security Created by Commercial Investors		1199
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1199
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1200
3.5 Legal Requirements Before an Entity Can Give Valid Security		1200
3.6 Formalities When a Borrower Is in Default		1200
3.7 Subordinating Existing Debt to Newly Created Debt		1202
3.8 Lenders’ Liability Under Environmental Laws		1202
3.9 Effects of a Borrower Becoming Insolvent		1202
3.10 Taxes on Loans		1202
4. Planning and Zoning		1202
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1202
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1203
4.3 Regulatory Authorities		1203
4.4 Obtaining Entitlements to Develop a New Project		1204
4.5 Right of Appeal Against an Authority’s Decision		1204
4.6 Agreements With Local or Governmental Authorities		1204
4.7 Enforcement of Restrictions on Development and Designated Use		1205
5. Investment Vehicles		1205
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1205
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1205
5.3 REITs		1206
5.4 Minimum Capital Requirement		1206
5.5 Applicable Governance Requirements		1206
5.6 Annual Entity Maintenance and Accounting Compliance		1206
6. Commercial Leases		1206
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1206
6.2 Types of Commercial Leases		1207
6.3 Regulation of Rents or Lease Terms		1207
6.4 Typical Terms of a Lease		1207
6.5 Rent Variation		1208
6.6 Determination of New Rent		1208
6.7 Payment of VAT		1208
6.8 Costs Payable by a Tenant at the Start of a Lease		1208
6.9 Payment of Maintenance and Repair		1208
6.10 Payment of Utilities and Telecommunications		1208
6.11 Payment of Property Taxes		1208
6.12 Insurance Issues		1209
6.13 Restrictions on the Use of Real Estate		1209
6.14 Tenant’s Ability to Alter and Improve Real Estate		1209
6.15 Specific Regulations		1209
6.16 Effect of the Tenant’s Insolvency		1210
6.17 Right to Occupy After Termination or Expiry of a Lease		1210
6.18 Right to Assign a Leasehold Interest		1210
6.19 Right to Terminate a Lease		1210
6.20 Registration Requirements		1211
6.21 Forced Eviction		1211
6.22 Termination by a Third Party		1211
6.23 Remedies/Damages for Breach		1211
7. Construction		1212
7.1 Common Structures Used to Price Construction Projects		1212
7.2 Assigning Responsibility for the Design and Construction of a Project		1212
7.3 Management of Construction Risk		1212
7.4 Management of Schedule-Related Risk		1213
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1213
7.6 Liens or Encumbrances in the Event of Non-Payment		1214
7.7 Requirements Before Use or Inhabitation		1215
8. Tax		1215
8.1 VAT and Sales Tax		1215
8.2 Mitigation of Tax Liability		1215
8.3 Municipal Taxes		1215
8.4 Income Tax Withholding for Foreign Investors		1215
8.5 Tax Benefits		1216
1. General		1230
1.1 Main Sources of Law		1230
1.2 Main Market Trends and Deals		1230
1.3 Proposals for Reform		1230
2. Sale and Purchase		1230
2.1 Categories of Property Rights		1230
2.2 Laws Applicable to Transfer of Title		1231
2.3 Effecting Lawful and Proper Transfer of Title		1231
2.4 Real Estate Due Diligence		1232
2.5 Typical Representations and Warranties		1232
2.6 Important Areas of Law for Investors		1232
2.7 Soil Pollution or Environmental Contamination		1233
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1233
2.9 Condemnation, Expropriation or Compulsory Purchase		1233
2.10 Taxes Applicable to a Transaction		1233
2.11 Legal Restrictions on Foreign Investors		1234
3. Real Estate Finance		1234
3.1 Financing Acquisitions of Commercial Real Estate		1234
3.2 Typical Security Created by Commercial Investors		1234
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1234
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1235
3.5 Legal Requirements Before an Entity Can Give Valid Security		1235
3.6 Formalities When a Borrower Is in Default		1235
3.7 Subordinating Existing Debt to Newly Created Debt		1235
3.8 Lenders’ Liability Under Environmental Laws		1236
3.9 Effects of a Borrower Becoming Insolvent		1236
3.10 Taxes on Loans		1236
4. Planning and Zoning		1236
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1236
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1237
4.3 Regulatory Authorities		1237
4.4 Obtaining Entitlements to Develop a New Project		1237
4.5 Right of Appeal Against an Authority’s Decision		1238
4.6 Agreements With Local or Governmental Authorities		1238
4.7 Enforcement of Restrictions on Development and Designated Use		1238
5. Investment Vehicles		1239
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1239
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1239
5.3 REITs		1239
5.4 Minimum Capital Requirement		1239
5.5 Applicable Governance Requirements		1239
5.6 Annual Entity Maintenance and Accounting Compliance		1239
6. Commercial Leases		1240
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1240
6.2 Types of Commercial Leases		1240
6.3 Regulation of Rents or Lease Terms		1241
6.4 Typical Terms of a Lease		1241
6.5 Rent Variation		1241
6.6 Determination of New Rent		1241
6.7 Payment of VAT		1241
6.8 Costs Payable by a Tenant at the Start of a Lease		1241
6.9 Payment of Maintenance and Repair		1242
6.10 Payment of Utilities and Telecommunications		1242
6.11 Payment of Property Taxes		1242
6.12 Insurance Issues		1242
6.13 Restrictions on the Use of Real Estate		1243
6.14 Tenant’s Ability to Alter and Improve Real Estate		1243
6.15 Specific Regulations		1243
6.16 Effect of the Tenant’s Insolvency		1243
6.17 Right to Occupy After Termination or Expiry of a Lease		1243
6.18 Right to Assign a Leasehold Interest		1244
6.19 Right to Terminate a Lease		1244
6.20 Registration Requirements		1244
6.21 Forced Eviction		1244
6.22 Termination by a Third Party		1245
6.23 Remedies/Damages for Breach		1245
7. Construction		1245
7.1 Common Structures Used to Price Construction Projects		1245
7.2 Assigning Responsibility for the Design and Construction of a Project		1245
7.3 Management of Construction Risk		1246
7.4 Management of Schedule-Related Risk		1247
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1248
7.6 Liens or Encumbrances in the Event of Non-Payment		1248
7.7 Requirements Before Use or Inhabitation		1249
8. Tax		1249
8.1 VAT and Sales Tax		1249
8.2 Mitigation of Tax Liability		1249
8.3 Municipal Taxes		1249
8.4 Income Tax Withholding for Foreign Investors		1249
8.5 Tax Benefits		1249
1. General		1255
1.1 Main Sources of Law		1255
1.2 Main Market Trends and Deals		1255
1.3 Proposals for Reform		1255
2. Sale and Purchase		1256
2.1 Categories of Property Rights		1256
2.2 Laws Applicable to Transfer of Title		1256
2.3 Effecting Lawful and Proper Transfer of Title		1256
2.4 Real Estate Due Diligence		1257
2.5 Typical Representations and Warranties		1257
2.6 Important Areas of Law for Investors		1258
2.7 Soil Pollution or Environmental Contamination		1258
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1258
2.9 Condemnation, Expropriation or Compulsory Purchase		1258
2.10 Taxes Applicable to a Transaction		1259
2.11 Legal Restrictions on Foreign Investors		1259
3. Real Estate Finance		1259
3.1 Financing Acquisitions of Commercial Real Estate		1259
3.2 Typical Security Created by Commercial Investors		1260
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1260
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1260
3.5 Legal Requirements Before an Entity Can Give Valid Security		1260
3.6 Formalities When a Borrower Is in Default		1261
3.7 Subordinating Existing Debt to Newly Created Debt		1261
3.8 Lenders’ Liability Under Environmental Laws		1261
3.9 Effects of a Borrower Becoming Insolvent		1261
3.10 Taxes on Loans		1261
4. Planning and Zoning		1262
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1262
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1262
4.3 Regulatory Authorities		1262
4.4 Obtaining Entitlements to Develop a New Project		1262
4.5 Right of Appeal Against an Authority’s Decision		1262
4.6 Agreements With Local or Governmental Authorities		1263
4.7 Enforcement of Restrictions on Development and Designated Use		1263
5. Investment Vehicles		1263
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1263
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1263
5.3 REITs		1264
5.4 Minimum Capital Requirement		1265
5.5 Applicable Governance Requirements		1265
5.6 Annual Entity Maintenance and Accounting Compliance		1266
6. Commercial Leases		1266
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1266
6.2 Types of Commercial Leases		1266
6.3 Regulation of Rents or Lease Terms		1267
6.4 Typical Terms of a Lease		1267
6.5 Rent Variation		1267
6.6 Determination of New Rent		1267
6.7 Payment of VAT		1267
6.8 Costs Payable by a Tenant at the Start of a Lease		1267
6.9 Payment of Maintenance and Repair		1268
6.10 Payment of Utilities and Telecommunications		1268
6.11 Payment of Property Taxes		1268
6.12 Insurance Issues		1268
6.13 Restrictions on the Use of Real Estate		1268
6.14 Tenant’s Ability to Alter and Improve Real Estate		1268
6.15 Specific Regulations		1268
6.16 Effect of the Tenant’s Insolvency		1269
6.17 Right to Occupy After Termination or Expiry of a Lease		1269
6.18 Right to Assign a Leasehold Interest		1269
6.19 Right to Terminate a Lease		1269
6.20 Registration Requirements		1270
6.21 Forced Eviction		1270
6.22 Termination by a Third Party		1270
6.23 Remedies/Damages for Breach		1270
7. Construction		1271
7.1 Common Structures Used to Price Construction Projects		1271
7.2 Assigning Responsibility for the Design and Construction of a Project		1271
7.3 Management of Construction Risk		1271
7.4 Management of Schedule-Related Risk		1272
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1272
7.6 Liens or Encumbrances in the Event of Non-Payment		1272
7.7 Requirements Before Use or Inhabitation		1273
8. Tax		1273
8.1 VAT and Sales Tax		1273
8.2 Mitigation of Tax Liability		1273
8.3 Municipal Taxes		1273
8.4 Income Tax Withholding for Foreign Investors		1273
8.5 Tax Benefits		1273
1. General		1284
1.1 Main Sources of Law		1284
1.2 Main Market Trends and Deals		1284
1.3 Proposals for Reform		1284
2. Sale and Purchase		1285
2.1 Categories of Property Rights		1285
2.2 Laws Applicable to Transfer of Title		1285
2.3 Effecting Lawful and Proper Transfer of Title		1286
2.4 Real Estate Due Diligence		1286
2.5 Typical Representations and Warranties		1286
2.6 Important Areas of Law for Investors		1286
2.7 Soil Pollution or Environmental Contamination		1287
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1287
2.9 Condemnation, Expropriation or Compulsory Purchase		1287
2.10 Taxes Applicable to a Transaction		1287
2.11 Legal Restrictions on Foreign Investors		1288
3. Real Estate Finance		1288
3.1 Financing Acquisitions of Commercial Real Estate		1288
3.2 Typical Security Created by Commercial Investors		1288
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1288
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1288
3.5 Legal Requirements Before an Entity Can Give Valid Security		1288
3.6 Formalities When a Borrower Is in Default		1288
3.7 Subordinating Existing Debt to Newly Created Debt		1289
3.8 Lenders’ Liability Under Environmental Laws		1289
3.9 Effects of a Borrower Becoming Insolvent		1289
3.10 Taxes on Loans		1289
4. Planning and Zoning		1289
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1289
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1290
4.3 Regulatory Authorities		1290
4.4 Obtaining Entitlements to Develop a New Project		1290
4.5 Right of Appeal Against an Authority’s Decision		1290
4.6 Agreements With Local or Governmental Authorities		1290
4.7 Enforcement of Restrictions on Development and Designated Use		1290
5. Investment Vehicles		1291
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1291
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1291
5.3 REITs		1292
5.4 Minimum Capital Requirement		1292
5.5 Applicable Governance Requirements		1292
5.6 Annual Entity Maintenance and Accounting Compliance		1293
6. Commercial Leases		1293
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1293
6.2 Types of Commercial Leases		1293
6.3 Regulation of Rents or Lease Terms		1294
6.4 Typical Terms of a Lease		1294
6.5 Rent Variation		1294
6.6 Determination of New Rent		1294
6.7 Payment of VAT		1294
6.8 Costs Payable by a Tenant at the Start of a Lease		1294
6.9 Payment of Maintenance and Repair		1294
6.10 Payment of Utilities and Telecommunications		1294
6.11 Payment of Property Taxes		1295
6.12 Insurance Issues		1295
6.13 Restrictions on the Use of Real Estate		1295
6.14 Tenant’s Ability to Alter and Improve Real Estate		1295
6.15 Specific Regulations		1295
6.16 Effect of the Tenant’s Insolvency		1295
6.17 Right to Occupy After Termination or Expiry of a Lease		1295
6.18 Right to Assign a Leasehold Interest		1296
6.19 Right to Terminate a Lease		1296
6.20 Registration Requirements		1296
6.21 Forced Eviction		1296
6.22 Termination by a Third Party		1297
6.23 Remedies/Damages for Breach		1297
7. Construction		1297
7.1 Common Structures Used to Price Construction Projects		1297
7.2 Assigning Responsibility for the Design and Construction of a Project		1297
7.3 Management of Construction Risk		1299
7.4 Management of Schedule-Related Risk		1299
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1299
7.6 Liens or Encumbrances in the Event of Non-Payment		1299
7.7 Requirements Before Use or Inhabitation		1300
8. Tax		1300
8.1 VAT and Sales Tax		1300
8.2 Mitigation of Tax Liability		1300
8.3 Municipal Taxes		1300
8.4 Income Tax Withholding for Foreign Investors		1300
8.5 Tax Benefits		1301
1. General		1306
1.1 Main Sources of Law		1306
1.2 Main Market Trends and Deals		1306
1.3 Proposals for Reform		1306
2. Sale and Purchase		1307
2.1 Categories of Property Rights		1307
2.2 Laws Applicable to Transfer of Title		1307
2.3 Effecting Lawful and Proper Transfer of Title		1307
2.4 Real Estate Due Diligence		1308
2.5 Typical Representations and Warranties		1309
2.6 Important Areas of Law for Investors		1310
2.7 Soil Pollution or Environmental Contamination		1310
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1311
2.9 Condemnation, Expropriation or Compulsory Purchase		1311
2.10 Taxes Applicable to a Transaction		1311
2.11 Legal Restrictions on Foreign Investors		1311
3. Real Estate Finance		1312
3.1 Financing Acquisitions of Commercial Real Estate		1312
3.2 Typical Security Created by Commercial Investors		1312
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1313
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1313
3.5 Legal Requirements Before an Entity Can Give Valid Security		1313
3.6 Formalities When a Borrower Is in Default		1313
3.7 Subordinating Existing Debt to Newly Created Debt		1314
3.8 Lenders’ Liability Under Environmental Laws		1314
3.9 Effects of a Borrower Becoming Insolvent		1314
3.10 Taxes on Loans		1315
4. Planning and Zoning		1315
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1315
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1315
4.3 Regulatory Authorities		1315
4.4 Obtaining Entitlements to Develop a New Project		1316
4.5 Right of Appeal Against an Authority’s Decision		1316
4.6 Agreements With Local or Governmental Authorities		1316
4.7 Enforcement of Restrictions on Development and Designated Use		1317
5. Investment Vehicles		1317
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1317
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1317
5.3 REITs		1318
5.4 Minimum Capital Requirement		1318
5.5 Applicable Governance Requirements		1318
5.6 Annual Entity Maintenance and Accounting Compliance		1318
6. Commercial Leases		1319
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1319
6.2 Types of Commercial Leases		1319
6.3 Regulation of Rents or Lease Terms		1319
6.4 Typical Terms of a Lease		1319
6.5 Rent Variation		1320
6.6 Determination of New Rent		1320
6.7 Payment of VAT		1320
6.8 Costs Payable by a Tenant at the Start of a Lease		1320
6.9 Payment of Maintenance and Repair		1320
6.10 Payment of Utilities and Telecommunications		1320
6.11 Payment of Property Taxes		1320
6.12 Insurance Issues		1321
6.13 Restrictions on the Use of Real Estate		1321
6.14 Tenant’s Ability to Alter and Improve Real Estate		1321
6.15 Specific Regulations		1321
6.16 Effect of the Tenant’s Insolvency		1321
6.17 Right to Occupy After Termination or Expiry of a Lease		1322
6.18 Right to Assign a Leasehold Interest		1322
6.19 Right to Terminate a Lease		1322
6.20 Registration Requirements		1322
6.21 Forced Eviction		1322
6.22 Termination by a Third Party		1323
6.23 Remedies/Damages for Breach		1323
7. Construction		1323
7.1 Common Structures Used to Price Construction Projects		1323
7.2 Assigning Responsibility for the Design and Construction of a Project		1323
7.3 Management of Construction Risk		1323
7.4 Management of Schedule-Related Risk		1323
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1324
7.6 Liens or Encumbrances in the Event of Non-Payment		1324
7.7 Requirements Before Use or Inhabitation		1324
8. Tax		1324
8.1 VAT and Sales Tax		1324
8.2 Mitigation of Tax Liability		1324
8.3 Municipal Taxes		1324
8.4 Income Tax Withholding for Foreign Investors		1325
8.5 Tax Benefits		1325
1. General		1330
1.1 Main Sources of Law		1330
1.2 Main Market Trends and Deals		1330
1.3 Proposals for Reform		1331
2. Sale and Purchase		1331
2.1 Categories of Property Rights		1331
2.2 Laws Applicable to Transfer of Title		1332
2.3 Effecting Lawful and Proper Transfer of Title		1333
2.4 Real Estate Due Diligence		1333
2.5 Typical Representations and Warranties		1334
2.6 Important Areas of Law for Investors		1335
2.7 Soil Pollution or Environmental Contamination		1335
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1335
2.9 Condemnation, Expropriation or Compulsory Purchase		1335
2.10 Taxes Applicable to a Transaction		1336
2.11 Legal Restrictions on Foreign Investors		1336
3. Real Estate Finance		1336
3.1 Financing Acquisitions of Commercial Real Estate		1336
3.2 Typical Security Created by Commercial Investors		1336
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1336
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1337
3.5 Legal Requirements Before an Entity Can Give Valid Security		1337
3.6 Formalities When a Borrower Is in Default		1337
3.7 Subordinating Existing Debt to Newly Created Debt		1338
3.8 Lenders’ Liability Under Environmental Laws		1338
3.9 Effects of a Borrower Becoming Insolvent		1338
3.10 Taxes on Loans		1338
4. Planning and Zoning		1339
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1339
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1339
4.3 Regulatory Authorities		1339
4.4 Obtaining Entitlements to Develop a New Project		1339
4.5 Right of Appeal Against an Authority’s Decision		1340
4.6 Agreements With Local or Governmental Authorities		1340
4.7 Enforcement of Restrictions on Development and Designated Use		1340
5. Investment Vehicles		1340
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1340
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1341
5.3 REITs		1341
5.4 Minimum Capital Requirement		1342
5.5 Applicable Governance Requirements		1342
5.6 Annual Entity Maintenance and Accounting Compliance		1342
6. Commercial Leases		1342
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1342
6.2 Types of Commercial Leases		1342
6.3 Regulation of Rents or Lease Terms		1343
6.4 Typical Terms of a Lease		1343
6.5 Rent Variation		1343
6.6 Determination of New Rent		1343
6.7 Payment of VAT		1343
6.8 Costs Payable by a Tenant at the Start of a Lease		1343
6.9 Payment of Maintenance and Repair		1343
6.10 Payment of Utilities and Telecommunications		1343
6.11 Payment of Property Taxes		1344
6.12 Insurance Issues		1344
6.13 Restrictions on the Use of Real Estate		1344
6.14 Tenant’s Ability to Alter and Improve Real Estate		1344
6.15 Specific Regulations		1344
6.16 Effect of the Tenant’s Insolvency		1345
6.17 Right to Occupy After Termination or Expiry of a Lease		1345
6.18 Right to Assign a Leasehold Interest		1345
6.19 Right to Terminate a Lease		1345
6.20 Registration Requirements		1345
6.21 Forced Eviction		1346
6.22 Termination by a Third Party		1346
6.23 Remedies/Damages for Breach		1346
7. Construction		1346
7.1 Common Structures Used to Price Construction Projects		1346
7.2 Assigning Responsibility for the Design and Construction of a Project		1347
7.3 Management of Construction Risk		1347
7.4 Management of Schedule-Related Risk		1347
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1347
7.6 Liens or Encumbrances in the Event of Non-Payment		1347
7.7 Requirements Before Use or Inhabitation		1348
8. Tax		1348
8.1 VAT and Sales Tax		1348
8.2 Mitigation of Tax Liability		1348
8.3 Municipal Taxes		1348
8.4 Income Tax Withholding for Foreign Investors		1348
8.5 Tax Benefits		1348
1. General		1354
1.1 Main Sources of Law		1354
1.2 Main Market Trends and Deals		1354
1.3 Proposals for Reform		1354
2. Sale and Purchase		1355
2.1 Categories of Property Rights		1355
2.2 Laws Applicable to Transfer of Title		1355
2.3 Effecting Lawful and Proper Transfer of Title		1355
2.4 Real Estate Due Diligence		1356
2.5 Typical Representations and Warranties		1356
2.6 Important Areas of Law for Investors		1357
2.7 Soil Pollution or Environmental Contamination		1357
2.8 Permitted Uses of Real Estate Under Zoning or Planning Law		1357
2.9 Condemnation, Expropriation or Compulsory Purchase		1358
2.10 Taxes Applicable to a Transaction		1359
2.11 Legal Restrictions on Foreign Investors		1360
3. Real Estate Finance		1360
3.1 Financing Acquisitions of Commercial Real Estate		1360
3.2 Typical Security Created by Commercial Investors		1361
3.3 Restrictions on Granting Security Over Real Estate to Foreign Lenders		1361
3.4 Taxes or Fees Relating to the Granting and Enforcement of Security		1361
3.5 Legal Requirements Before an Entity Can Give Valid Security		1361
3.6 Formalities When a Borrower Is in Default		1362
3.7 Subordinating Existing Debt to Newly Created Debt		1362
3.8 Lenders’ Liability Under Environmental Laws		1362
3.9 Effects of a Borrower Becoming Insolvent		1362
3.10 Taxes on Loans		1363
4. Planning and Zoning		1363
4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning		1363
4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction		1363
4.3 Regulatory Authorities		1363
4.4 Obtaining Entitlements to Develop a New Project		1363
4.5 Right of Appeal Against an Authority’s Decision		1364
4.6 Agreements With Local or Governmental Authorities		1364
4.7 Enforcement of Restrictions on Development and Designated Use		1364
5. Investment Vehicles		1364
5.1 Types of Entities Available to Investors to Hold Real Estate Assets		1364
5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity		1364
5.3 REITs		1365
5.4 Minimum Capital Requirement		1365
5.5 Applicable Governance Requirements		1365
5.6 Annual Entity Maintenance and Accounting Compliance		1365
6. Commercial Leases		1365
6.1 Types of Arrangements Allowing the Use of Real Estate for a Limited Period of Time		1365
6.2 Types of Commercial Leases		1366
6.3 Regulation of Rents or Lease Terms		1366
6.4 Typical Terms of a Lease		1366
6.5 Rent Variation		1366
6.6 Determination of New Rent		1366
6.7 Payment of VAT		1366
6.8 Costs Payable by a Tenant at the Start of a Lease		1366
6.9 Payment of Maintenance and Repair		1366
6.10 Payment of Utilities and Telecommunications		1367
6.11 Payment of Property Taxes		1367
6.12 Insurance Issues		1367
6.13 Restrictions on the Use of Real Estate		1367
6.14 Tenant’s Ability to Alter and Improve Real Estate		1367
6.15 Specific Regulations		1367
6.16 Effect of the Tenant’s Insolvency		1368
6.17 Right to Occupy After Termination or Expiry of a Lease		1368
6.18 Right to Assign a Leasehold Interest		1368
6.19 Right to Terminate a Lease		1369
6.20 Registration Requirements		1369
6.21 Forced Eviction		1369
6.22 Termination by a Third Party		1369
6.23 Remedies/Damages for Breach		1370
7. Construction		1370
7.1 Common Structures Used to Price Construction Projects		1370
7.2 Assigning Responsibility for the Design and Construction of a Project		1370
7.3 Management of Construction Risk		1370
7.4 Management of Schedule-Related Risk		1371
7.5 Additional Forms of Security to Guarantee a Contractor’s Performance		1371
7.6 Liens or Encumbrances in the Event of Non-Payment		1371
7.7 Requirements Before Use or Inhabitation		1371
8. Tax		1372
8.1 VAT and Sales Tax		1372
8.2 Mitigation of Tax Liability		1372
8.3 Municipal Taxes		1372
8.4 Income Tax Withholding for Foreign Investors		1372
8.5 Tax Benefits		1372

Powered by