• Those affected. Non-residents speak: "It's crazy that they forbid us to buy houses"
  • Reactions. Sánchez deflates the plan and despairs the Balearic president

The European Commission pronounces on the claim of the parties that govern the Balearic Islands to limit the purchase of homes by non-residents in the archipelago.

A controversial measure that was initially proposed by Unidas Podemos and the nationalists of Més and has been supported by the PSOE, and that for the moment has resulted in a mere declaration of intentions of the Balearic Parliament, without normative translation although with the express support of the Balearic president Francina Armengol.

The PP MEP Rosa Estaràs raised the consultation to the executive body of the European Union a few weeks ago. He did so through a formal question in which he asked whether "it would be possible for member states to limit the purchase of housing to non-residents".

The Commission replied through Mairead McGuiness, European Commissioner for Financial Services, Financial Stability and Market Union.

In her reply, the Commissioner replies on behalf of the Commission that, as a rule, such restrictions are prohibited, although she specifies that certain exceptional restrictions may be authorised only if they are justified on grounds of "public policy" or "overriding reasons in the public interest". Measures that could only be considered provided that their purpose has been previously recognized and endorsed in other cases by the jurisprudence of the Community courts.

"Article 63 of the Treaty on the Functioning of the European Union - includes the European Commission's written answer to the question of the Mallorcan MEP - prohibits restrictions on capital movements related to the acquisition of real estate, including homes, by non-resident EU nationals."

That is the premise that, from the outset, closes the door to an initiative that for the moment, and in the absence of two and a half months for the regional elections, has not gone beyond being a political debate in the Balearic Islands. A proposal with which the Balearic government says it wants to stop the galloping increase in housing prices in the island region and that for the real estate sector and the main political opposition group is a "smokescreen" to cover the "failure" of housing policies.

'Without discrimination'

"However," says the Commissioner responsible for ensuring the unity of Community markets, "such restrictions may be justified on the grounds set out in Article 65 of the Treaty." It adds: "namely, for reasons of public policy or public security or for overriding reasons of general interest recognised in the case-law of the Court of Justice of the European Union".

Such restrictions on the free movement of capital could only be authorized exceptionally, with the approval of the courts and "provided that they are non-discriminatory and proportionate to the objective pursued". Which means, adds the European commissioner, "that they are adequate to guarantee in a coherent and systematic way the achievement of the objective pursued and do not go beyond what is necessary to achieve it".

The fact that Article 65 of the Treaty refers mainly to tax issues and that reference to jurisprudence and the "non-discrimination" of any measure that restricts the freedom of capital makes these exceptions a barrier difficult to overcome in case the Government achieves the future support of the Spanish Government to raise the debate in the EU.

In this line, a legal report sent to the Balearic Parliament and prepared by the law firm Uría Menéndez on behalf of the Spanish promoters reflects that the measure is "incompatible with European Law". It considers that "it would most likely be considered, in the light of the jurisprudence of the Court of Justice of the EU, to be indirectly discriminatory as it is proportionally likely to benefit Spanish citizens and to harm citizens of other EU Member States".

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