az Alert | Minvu instructs on validity of incentives and conditions in land use planning instruments

The authority issued a new circular to modify the questioned criteria.

On September 12, 2018, by means of DDU 413, the Urban Development Division referred for the first time to the validity of the incentives or conditions established in the territorial planning instruments in accordance with the provisions of Article 5° of Law 21,078 on Transparency of the Land Market and Value Increases due to Urban Boundary Expansion.

Said circular stated that all incentives and conditions contained in the intercommunal and communal regulatory plans were valid as long as they had been instituted prior to October 15, 2016, without any distinction whatsoever.

Likewise, the circular clarified that the limitation of subsection 3° of Article 184 of the General Law of Urbanism and Construction (LGUC) would not apply, so that the incentives and conditions validated by Law 21,078 may be used in the same project or pre-project.

Subsequently, after a series of questionings, the Comptroller General of the Republic (CGR) pointed out that the mere fact of having established the incentives and conditions contemplated in the territorial planning instruments prior to October 15, 2016 is not a sufficient requirement for their declaration of validity, so it ordered the DDU to take the measures tending to correct the exposed criteria.

In this context, on January 03, 2023, the Urban Development Division issued DDU 475 to modify the questioned criteria, emphasizing the following points:

  • Modifies section 4° noting that the incentives and conditions contemplated in the territorial planning instruments are valid, as long as they were established prior to October 15, 2016 and to the extent that they comply with the provisions of Articles 183 and 184 of the LGUC.
  • Eliminates section 5° which indicated the date of establishment as the only validity requirement.
  • Modifies paragraph 6 specifying that for these cases the limitation contained in paragraph 3 of article 184 of the LGUC does not apply, the regulation contained in the other paragraphs of article 184 and article 183, both of the LGUC, will always be applicable.

For more information on these topics please contact our group azRealEstate:

Álvaro Rosenblut | Partner |

Valentina Palma | Associate |

Pablo Méndez | Associate |