Marbella sees an increase in applications for opening licences.

Between December and January there were 88 applications for new premises or a change of ownership
Small businesses in Marbella are weathering the storm in spite of the difficulties. Not all of them have managed to continue trading, but it is clear that the economic crisis has not affected the initiative of entrepreneurs and this is confirmed by the latest figures issued by Marbella Town Hall’s Commerce department about opening licences. Between December 2011 and January 2012 a total of 88 applications were processed. Of these, 70 per cent were for new premises and the remainder for businesses which had undergone a change in ownership.
“These months were especially bad for the economy as a whole, but even so we have noticed an important increase in applications” says councillor José Eduardo Díaz.
The statistics show that this figure is 50 per cent higher than in the same period of the previous year. “What this reveals is that the small business sector remains active in Marbella. Even though many businesses have been forced to cease trading, almost immediately another one opens up, either in the same premises or somewhere else”, explains the councillor. Many of the new businesses in Marbella are fashion shops, although there are others in almost all sectors, from bookshops, opticians, banks and clinics to jewellery, accessories and imports and exports of foods.

The new millennium came hand in hand with economic cheer and construction became an easy source of income for municipal coffers. The temptation of personally pocketing some of this new-found wealth has resulted in huge scandals, with Marbella as the finest example, and mayors, former mayors and councillors ending up behind bars.

Other council leaders in the province of Malaga, of all political colours, were too lenient in their application of planning laws and, without actually putting their fingers in the till, contributed actively or passively to the proliferation of illegal properties in rural areas. Here the prime example is the Axarquía where there has been a considerable change to the landscape and to environmental resources that the Junta de Andalucía is now planning to rectify.

However no district in the province of Malaga has been spared. They all have at least one mayor charged with or convicted of planning offences.

The ‘Malaya’ case is well under way and promises to continue for some time, but behind it comes a long list of smaller cases with crimes ranging from corruption and embezzlement to planning offences, that is, allowing illegal construction to take place.

Last week saw the arrest of the former mayor of Ronda, Antonio Marín Lara, and three councillors who have eventually handed in their notice. As with Marbella, rumours of municipal corruption had been flying around the town long before the police moved in.

Who’s to blame

So how did the situation get this far? Did the controls fail? Did the powers that be turn a blind eye? There were definitely systems established to regulate municipal planning. The Junta de Andalucía, the Diputación (provincial authority), political parties, state security forces, public prosecutors, judges… all form part of the social mechanism that only addressed the problem when the disease had become widespread. That was when the alarm bells started to ring.

“Not only have the political parties’ controls failed but also those of the administration. In the golden age of planning, the Junta de Andalucía reaped in the taxes and imposed no restrictions. And the town halls made money and lived above their means. They were dazzled by the golden fleece of town planning”, criticises the provincial coordinator of Izquierda Unida, José Antonio Castro.

The provincial president of the PP, Elías Bendodo, states that “there has been a lack of strategic planning. Everyone has been allowed to do what they wanted and this has had negative consequences, with chaotic development and the Junta de Andalucía turning a blind eye”.

Meanwhile the Junta de Andalucía, bearing the brunt of all the political criticism, passes the blame back to the town halls. The provincial delegate for Public Works, Enrique Benítez, says: “We enforce the planning law but it must be said that it is the town hall’s responsibility to control planning discipline”. He also points out that the Inspection Department was created in 2005 and this “has adequate human resources, and has an open line of communication with the Public Prosecutor, drawing up reports at his request”.

Neither is the Public Prosecution_Department blame-free, as it is criticised for being too slow to react. Nevertheless the chief prosecutor, Antonio Morales, states that “corruption has incredibly been supported by citizens with their vote, and the results are there to be seen”. He did admit that “self-criticism is never a bad thing because things could always be done better”.

Judges and courts

The judicial system has been criticised, but also applauded for its significant operations, such as the ‘Malaya’ case initiated by the Judge Miguel Ángel Torres. The courts have also been accused of acting too late. In their defence they point out that “Judges can only act on a report from the police or the Guardia Civil or a lawsuit filed by an individual. And that is what they have done. I think that society in general was too slow in reacting”, says the head of the provincial court for nine years, Francisco Arroyo Fiestas.

The growing chaos of illegal buildings prompted the Guardia Civil’s nature protection unit,_Seprona, to take action in 2009. Officers combed the countryside in search of illegal properties, village by village, in alphabetical order. Not one district was saved.

Alcaucín residents fear exclusion from amnesty

On April 28th, 2011, posted in: News by

SUR in English 25/04/11 – Agustín Peláez

Alcaucín residents fear exclusion from amnesty
The Town Hall has criticised the Junta for not carrying out an inventory of homes built illegally in the municipality

Alcaucín. A view that includes many of the homes built illegally in the municipality with the ‘Boquete de Zafarraya’ in the background. A. Peláez
“People are getting more and more nervous. When they come to the Town Hall to ask about the future of their properties we don’t know what to tell them. Neither can we explain why Alcaucín has been missed out by the Junta de Andalucía when it drew up inventories of irregular buildings in most of the other municipalities in the Axarquía. The fact that the planning situation in Alcaucín is in the courts with the ‘Arcos’ case is not a valid excuse. This is unfair”. With these words the acting mayor and planning councillor, Domingo Lozano (PP), expresses the unease and concern that has been generated in Alcaucín by the regional Department of Public Works’ decision to exclude the municipality from the inventory of illegal buildings in the Axarquía. The councillor explains that the decision has been interpreted by the Town Hall as an attempt to leave the village out of the planning amnesty announced by the Junta.
“The Arcos case cannot turn Alcaucín into a village of outcasts. Only a minority of the defendants are from the municipality. We are hard-working and honest people. The majority of the property owners bought their homes in good faith, investing their savings, and now they see themselves being excluded from a process that is not being applied to us because the Junta says that local planning is in the courts”, says Lozano.
According to the councillor, the reality is that the municipality and its residents are suffering the consequences of the poor planning management of the former mayor, ex-Socialist José Manuel Martín Alba, who has since become the main defendant in the ‘Arcos’ case, and his team of councillors.
“It so happens that Alcaucín was one of the first municipalities to start the inventory, but then it was stopped by the Junta. Later we asked on as many as four occasions for the work to continue but we have only received silence for an answer. Two weeks ago we asked for help with resuming the inventory, but the Junta says it has no resources, and so we are still being pushed to one side”, points out Lozano.
The councillor goes on to say that there is a constant trickle of residents going to the Town Hall to ask about the situation of their country homes. “People are very impatient. When they are told time and time again that the Town Hall doesn’t know anything, insults are frequent. It’s not the owners’ fault; they want solutions, and the Junta, which also has its share of the responsibility, doesn’t even want to help us do the inventory”, continues the acting mayor.
In the municipality of Alcaucín, where there is a registered population of around 3,000, it is estimated that there are between 1,600 and 1,800 irregular properties on land not designated for building, according to the Town Hall. This figure should be added to the 12,760 properties already counted by the Junta de Andalucía in 22 of the 31 municipalities in the Axarquía.
Already counted
The properties counted so far in the district are in Almáchar, Arenas, Comares, Iznate, Moclinejo, Alfarnate, Benamargosa, El Borge, Canillas de Albaida, Cómpeta, Cútar, Macharaviaya, Salares, Sedella, Alfarnatejo, Algarrobo, Benamocarra, Colmenar, Frigiliana, Periana, Sayalonga and Riogordo. Inventories are still to be drawn up for Alcaucín, Canillas de Aceituno, La Viñuela, Totalán, Rincón de la Victoria, Vélez-Málaga, Torrox and Nerja.
In the case of La Viñuela the inventory is being drawn up in parallel with the new urban development plan (PGOU), the first draft of which is expected to be approved in the new few weeks.
Of the 12,760 illegal buildings counted so far by the Junta, 859 are on land classed as ‘protected’, and 976 were built recently enough to be still prosecuted, which means that a total of 11,025 are likely to be legalised.
With these figures, collected in the Axarquía and in the rest of Andalucía, the Junta is preparing a special decree to regulate properties build on land classed as ‘no urbanizable’.
Foreign home owners call for speedy regularisation
The president of the association Save Our Homes Axarquía, Phillip Smalley, met last week in Seville with the director general of Planning Inspection, Rosa Urioste. He has called for the regional Department of Public Works carry out the regularisation process as quickly and easily as possible, given the great unease among the affected home owners. “We have been fighting for a solution for four years and while we believe that the Junta is committed to regularising our homes, we are still not fully reassured. We will be happy when they solve our problem”, Smalley pointed out.
The SOHA president also stated that the last thing the Junta de Andalucía has told the group is that it is working on the decree to legalise the homes, but that the new regulation will not be in force for at least another four or six months. “Now all we can do is wait, although the Junta must speed up the process as much as possible”, Smalley insisted.

Chased by a Spanish mortgage

On April 28th, 2011, posted in: News by

SUR in English 25.04.11 – 10:59 – José M. Camarero

Chased by a Spanish mortgage
Banks never rest and even take action against foreigners who hand over their keys and leave the country

Few clients escape legal action by the bank when it comes to mortgage default. Not even property owners who hand over their keys to the bank and return to their home countries, victims of the financial situation in Spain and with no family or social resources here to fall back on. But the banks have all the time in the world and the law does not prevent them from following up a legal judgement in another country.
In no more than three years the number of mortgage foreclosures in Spain (the final legal step to repossess a property in the case of default) has almost multiplied by four, reaching 93,622 cases in 2010, according to statistics from the CGPJ (General Council for the Judiciary). “The majority involve foreign citizens” maintain sources, both from the association for those affected by property seizure and auction, AFES, and from certain financial institutions that have dealt significantly with foreign property buyers during the boom years.
“When the time comes for the foreclosure on the mortgage to be finalised, they go back to their home countries”, explain AFES sources who warn families in this situation that this is “not a solution in the long term”.
This is because when a court has authorised the foreclosure, the bank or savings bank “has the action in personam which is recognised regardless of the country you are in”, state judicial sources. This means that legally speaking the banks can chase their former clients wherever they are in the world.
The legal concept of “recognition and enforcement of foreign court orders” allows a sentence delivered in Spain to be recognised in different countries such as Ecuador or Romania, where many of Spain’s foreign residents come from. It is necessary to wait until the legal system in these countries recognises the Spanish sentence “depending on Spain’s agreement with each country”, continue the judicial sources.
In the case of citizens from EU countries, this process is easier and faster, say the sources, thanks to the EU regulation 44/2001 which states that judgements given in EU countries are to be recognised without special proceedings.
Sources from a savings bank admit that it is costly enough to chase up a debt in Spain, and so “the idea can end up being abandoned when there are thousands of kilometres involved”. However AFES warns that “banks have all the time in the world to enforce a sentence”.
The main problem Spanish banks face is that their debtors could live in countries, such as the United States, that recognise the concept of ‘deed in lieu of foreclosure’, where the debt is considered cleared when the property is handed over. In these cases the Spanish law ought to be applied, although on US territory the American legal system does not have to recognise a judgement that goes against US law in this type of case.
Spain’s Civil Code establishes that personal responsibility for a loan “affects all their assets, both present and future”, explains the lawyer Francisco López Soria, an expert in consumer affairs.
The best option is to try to avoid the foreclosure being finalised with a court order. Several months can pass from the moment a family stops meeting their monthly repayments until a final court order is passed. This period gives mortgage holders a margin to negotiate a solution with their bank.
The association AFES attempts to act as a mediator between customer and bank. “They can wipe out part of the debt with the sale of the property, introduce grace periods, or other solutions”, says the organisation. In that way “the bank gets rid of a property before having to go through costly foreclosure proceedings”, explain AFES sources.
When the property is sold, it is likely that the price will be lower than the mortgage holder paid when they bought the house. Some banks admit that they allow clients to refinance the difference in order to avoid the case going to court.
Meanwhile citizens with mortgage difficulties are hoping for a modification to Spanish law to allow the concept of ‘deed in lieu of foreclosure’ to be applied. While some “flexibility has been announced, the majority of experts believe it is improbable that Spain will adopt the same system as the United States. “There could be slight modifications”, says López Soria, but a change to the current system is unlikely.