Relief or No Relief? - Part Two, Amendment 160.

Amendment 160 to the Planning and Building Law – Splitting the Tracks, the Return of Reliefs to Existing Buildings, and Changes in Betterment Levies.

In the previous article, we discussed the dramatic effects of Amendment 134 to the Planning and Building Law, which significantly reduced the "institution of reliefs" and shifted the planning center of gravity to detailed plans. However, the field did not remain indifferent to the tightening of procedures: with the entry into force of Amendment 160 to the Planning and Building Law, the legislature created a graded framework designed to balance the need for planning certainty with the flexibility required in dealing with existing buildings and promoting infrastructure.

This part of the article will analyze the new dual-track structure determined by Amendment 160, the reliefs returned to the game, and its direct implications for real estate appraisals and betterment levies.

A. The New Dual-Track Structure: Broad vs. Restricted

Amendment 160 anchored the reliefs for existing buildings in permanent status, and defined two separate mechanisms operated in accordance with the property's characteristics:

Broad relief mechanism (pursuant to Section 147(b) of the Law):

• To whom does it apply? To buildings whose construction was completed 8 years or more prior to the submission date of the relief application, and which do not involve demolition and rebuilding.

• What is permitted in this track? Under this mechanism, a local planning and building committee may consider relief from an applicable plan, subject to the statutory conditions and exclusions, including the restrictions concerning material deviations and certain plans approved under Section 62A. A relief may also be unavailable where a qualifying new plan has specifically addressed the same subject for the relevant building.

• The important caveat (new plans): Important caveat — new plans: A relief may not be granted where a qualifying plan approved after 1 April 2025 specifically provides, for the relevant building, for expanded use of the land in the same subject for which the relief is sought. The fact that a new plan addresses other planning parameters does not, by itself, necessarily preclude relief on a different parameter. The statutory wording and the specific plan must be examined in each case.

Restricted relief mechanism (pursuant to Section 147(a) of the Law):

• To whom does it apply? In all other cases that do not meet the conditions of the broad track (for example, relatively new buildings or projects that do not meet the 8-year condition).

• What is permitted in this track? The option to approve a relief is limited solely to a closed list explicitly set forth in the Planning and Building Regulations. This list mainly includes critical needs such as safety, protection, and accessibility (adding a secure room [MAMAD], elevators, ramps and lifts, external stairs), infrastructure and garbage storage solutions, as well as minor deviations in rear and side building lines (up to 10% of the vacant plot area).

B. Further News in Amendment 160: National Licensing Authority and Renewable Energy

Beyond regulating the relief mechanism, Amendment 160 included a series of additional structural reforms with a significant impact on the market:

• National Licensing Authority: National Licensing Authority: Amendment 160 expanded the framework under which applications for permits involving 80 or more housing units may be transferred for handling by the National Licensing Authority, subject to the applicable statutory conditions. The purpose is to provide an additional licensing route for qualifying projects, rather than to guarantee a shorter approval process in every case.

• Renewable energy facilities and betterment levies: Amendment 160 also addressed betterment-levy arrangements for certain renewable energy facilities. The applicable exemption or reduced levy depends on the specific statutory provision, the type of facility and the relevant conditions and dates.

C. The Implications for Real Estate Appraisals and Betterment Levies

The return of flexibility in the broad track for old buildings generates complexity and also opportunities in the world of appraisal and municipal taxation:

• Reassessing the potential of existing properties: For valuation purposes, the building's age is only one part of the analysis. Where a property may qualify for the broader relief mechanism, the appraiser should examine the applicable plan, the statutory exclusions, the feasibility of obtaining the requested relief and the extent to which that possibility affects market value. Eligibility to apply for relief does not, in itself, establish an additional building right or a particular amount of planning potential.

• Additional permitted use of betterment levy funds: Amendment 160 introduced a provision allowing local authorities, subject to statutory conditions, to allocate a limited portion of their betterment levy balances to a dedicated fund for the long-term maintenance of public buildings owned by the local authority. The provision covers preventive and corrective maintenance, but excludes routine maintenance.

• Strict due diligence: When drafting a counter-appraisal or calculating a betterment levy liability, the appraiser must meticulously check whether the newly approved plan closed the door on requesting the specific relief in the property, since any such statutory change drastically alters the calculation of the property's value and the tax liability derived from it.

D. Interim Summary

Amendment 160 proved that the planning and building legislature understood that a complete disconnection of the relief mechanism creates point paralysis in existing buildings. The creation of the two tracks – the broad for old buildings and the restricted for all other cases – are supposed to constitute an appropriate solution. Time will tell whether the legislative bodies actually succeeded in their mission or not.

Before purchasing a property, a buyer should verify whether prior planning approvals or reliefs may give rise to a betterment levy, whether a levy has been assessed or paid, and whether any related liability or dispute remains unresolved. The identity of the person legally liable, the relevant date and the payment obligation must be determined under the applicable law and the circumstances of the transaction. A property-specific appraisal and legal review can help identify potential exposure before the transaction is completed.

NOTE:

The information presented in this article is general, concise, and intended solely for informational and educational purposes, and does not in any way constitute a legal, appraisal, or individual planning opinion. The field of planning and construction is characterized by high statutory complexity and regulatory dynamism, including frequent amendments by the legislature. Accordingly, the contents should not be relied upon as an exclusive basis for business or property-related decisions, and a tailored professional assessment must be conducted alongside qualified experts to verify the current validity of applicable laws and local procedures.