On 1 January 2017, a new wording of the Lithuanian Construction Law has entered into effect, offering some changes in regulation and procedures. Here, I will cover some of the essentials, which will have a direct bearing on real estate builders and developers.
There will be fewer institutions checking whether construction or reconstruction project solutions comply with the established requirements, which will mean a shorter period for checking construction projects, and much faster process of issuingconstruction permit documention to the builders.
The new wording of the Construction Law prescribes shorter deadlines for the issuing of the terms and conditions of special requirements and connection to engineering systems. On top of that, special requirements will no longer be necessary on mandatory basis. These changes will provide builders with the discretion to measure if these requirements are necessary to them at all, yet building projects will still have to conform to the relevant requirements of laws and legislation as well as normative construction technical documentation.
Once the new wording of the Construction Law is in effect, the simplified procedure of building completion will apply not only to one- and two-flat houses and appurtenances thereof, but to other special and ordinary structures from the list drawn by the Minister of Environment of the Republic of Lithuania that do not have a material environmental or social effect. This will singularly accelerate the construction completion procedure.
One of the major new things about the new Construction Law is that the builder and the contractor will be required to guarantee the indemnity of the costs to remedy any defects as may be attributable to the contractors for the amount that, over the defects liability period, may not be less than 5 per cent of the construction cost of the building. This guarantee is aimed to ensure that if any construction defects were to be found, the company would have to compensate the losses pertaining to the remedy thereof instead of considering the very popular bankruptcy scenario.
In order to simplify the ConstructionTechnical Regulation System currently in place, and considering the wording of the Construction Law about to take effect as well as the changes it implies, as of 1 January 2017, Building Technical Regulations are consolidated by outlining the provisions of several regulations in one document.
By Daiva Čekanavičienė, Associate at Law Firm GLIMSTEDT