Page 5. “Property and Environment in Denmark”
PROPERTY AND ENVIRONMENT
Land and property can be either leased or owned according to Danish law. The statutes applicable to leases and purchases of land and property are generally made to protect respectively the lessee or the purchaser of land and property.
The operations of a business may be subject to environmental laws regarding pollution and hazardous substances. In some cases, environmental legislation would require the said business to notify the relevant governmental body or ensuring that relevant permits or licences are obtained.
Lease of premises
Several rules regarding lease agreements are mandatory and are generally made to protect the lessee.
A lease agreement does not have to be in writing, unless the lessee or the landlord so wishes. A lease agreement may be entered for either a specified or unspecified term. Extensive lease agreements are common. No written notice of termination is necessary for a lease agreement in the case of a specified lease term.
Purchase of land and property
Purchase of land in Denmark is fairly simple compared to other countries. Information on all properties, including the owner’s identity, is kept digitally in the Land Registry by the courts.
The agreement shall contain the purchase price, identification of the land, name of the purchaser and the seller and a declaration of transfer from the seller to the purchaser. The purchaser shall register the purchase in the official Land Registry and pay stamp duty. Registration can now be made online.
The right to purchase property in Denmark is based on certain conditions. A purchaser of property must be a resident in Denmark for at least 5 years. If this condition is not met – approval from the Justice Department is required. When purchasing vacation homes, the approval is stricter since the buyer shall assert that he is especially connected to Denmark.
There are some leniency terms for residents and companies that reside within the EU and EEA countries, given that approval from the Justice Department is not required.
Seller’s obligations
If the purchased land would fail to meet expectations or the terms of the purchase agreement, the purchaser shall be entitled to a reduction of the purchase price or to terminate the agreement. The purchaser shall notify the seller of any such claim as soon as possible upon noticing the fault, within a reasonable period during which he should have noticed the fault, although always within 20 years after obtaining access to the property.
The rights of the purchaser may appear generous, however, in practice a purchaser can not make any claim for faults he should have noticed on any reasonable inspection of the property prior to the purchase. The obligation to inspect would be onerous and purchasers therefore generally use the services of a construction or building inspector to carry out the inspection.
Environmental law
The most important statutes on the environment are included in the Danish Environmental Protection Act of 1973 (Miljøbeskyttelsesloven), the Danish Environmental Liabilities Act of 1994 (Miljøerstatningsloven) and the Contaminated Soil Act of 2001 (Jordforureningsloven), which to a great extent are enforced through licensing requirements as far as hazardous environmental activities are concerned.
Acquisition of a licence
Some polluting activities require a licence. Even if a licence is not required by law, there may be an advantage in voluntarily applying for one. As long as the licence is valid, the operator is, in principle, entitled to operate a business according to the licence provisions. This means that the operator may, as a rule, rely on the provisions of the Environmental Protection Act concerning protective measures (cf. next paragraph).
Standard provisions
The above-mentioned acts impose standard provisions on protective measures. Every operator of a polluting or otherwise environmentally hazardous activity must comply with those provisions, whether or not the activity requires a permit.
The issue of liability for damages caused by pollution can be divided into three periods:
- Pollution before 1 January 2001
According to the Environmental Protection Act and the appurtenant set of rules, liability is, as the main rule, to be based on fault. Generally speaking, this means that in the event of a company’s violation of a rule or non-compliance with an enforcement/prohibition notice or failure to observe normal duty of care, the company may be held liable for damages caused by pollution.
- Pollution after 1 July 1994
If the pollution is related to companies bound for authorisation and listed in a separate annex to the Environmental Protection Act, the Act provides a statutory objective basis for the establishment of liability for damages – i.e. notwithstanding any fault – which applies to environmental authorities, neighbours and other injured parties.
It should be noted that the Environmental Protection Act only applies to the companies and activities listed in the separate Annex to the Act.
- Pollution after 1 January 2001
According to the Contaminated Soil Act, objective liability today applies to companies and public authorities notwithstanding any fault.
Please notice, that objective liability applies to private companies and public authorities whereas liability in respect of private persons still relies on fault.
Responsibility upon winding up
The provisions on protective measures continue to apply after the winding up of an operation. This may lead to an obligation to clean up the premises, including contaminated land. As a general rule, however, after a 30-year peiriod claims shall be statutebarred.
Responsibility beyond the operator
The basic principle of “the polluter pays” applies in Denmark as in other EU Member States. According to this principle, the polluter is only liable for pollution which took place before 1 January 2001.
However, it is recommended to be extremely careful when taking over a business and/or land on which a polluting activity has been carried out.
According to the Contaminated Soil Act and after 1 January 2001, an enforcement notice on a company in operation is binding on a subsequent operator, if at the time of taking over the company the operator knew or should have known that the enforcement notice had been served. As a consequence, the subsequent operator is obliged to comply with an enforcement notice or a prohibition notice if he was in bad faith as to the issue of the enforcement notice or prohibition notice.
Furthermore, an enforcement notice may be held in force in respect of subsequent owners of a polluted property subject to the following conditions:
if the property is a company in operation, i.e. it has not closed down, if prior to the take-over of the company, notice had been given that an enforcement notice would be served – or an enforcement notice had been served and the enforcement notice had not been complied with, if the seller had not complied with enforcement notices issued, irrespective of an injunction or a restraining order, if at the time of taking over the company, the buyer knew or should have known that notice had been given of the issue of an enforcement notice or that an enforcement notice had been issued, and if the buyer has taken over the company from someone who was or might become obliged to comply with an enforcement notice.
Page 5. “Property and Environment in Denmark”
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