Finland adopts law which allows confiscation of real estate from Russians

02 Jul 2024, 00 mins ago

On 27 June 2024, the Finnish Ministry of Justice reported on their website that amendments have been made to the Housing Companies Act which facilitate the confiscation of real estate from owners that have fallen behind in payment of dues.

The new amendments to Chapter 8 of the Limited Liability Housing Companies Act which were signed into law by the President of Finland on 28 June, allow the government to take possession of real estate belonging to those that fail to pay dues where they reside outside a European Economic Area state.

It is expected that the law would mainly affect Russian nationals who, after various EU Russia sanctions packages were introduced, are no longer able to pay utilities bills or other taxes and fees for their properties located in Southeastern and Eastern Finland. It has been previously reported that cases of debt recovery from Russian property owners are gradually accumulating.

The Housing Companies Act prescribes that if it is not possible to serve summons on property owners (or anyone being given the right to use the property) residing outside the EEA countries, despite their address being known, the warning can be published in the official newspaper which would be considered an official notification. If the email address of the owner is known, then a relevant possession notice could be sent to that email address.

Due to the EU Russia sanctions, it is not possible to send notifications by post, from Finland to Russia.

The warning can be published within 60 days of the decision being made to evict the owner and a challenge can be brought in accordance with the chapter 11 Section 9 of the Code of Judicial Procedure of Finland.

The law will enter into force on 8 July 2024, and it remains to be seen how many people are going to be affected by it.  It is also unknown if those decisions will be challenged in court as it would be difficult for any Russian residing in Russia to challenge the decisions to confiscate their properties and win any monetary compensation.

It is worth noting that while Protocol 1, Article 1 of the European Convention of the Human Rights provides that every natural or legal person is entitled to the peaceful enjoyment of his possessions; the Article 1 further state that this right “shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties”.

Gherson lawyers have deep experience in advising on sanctions laws and challenging decisions that violate human rights in national and international courts.

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The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

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