\n The Finance Minister of the Canaries has dampened hopes of the islands imposing a total prohibition on foreign property ownership by saying it’s “not authorised” by EU law, while stressing that some justified limitations could be negotiated.\n <\/p>\n
Canary Minister of Finance and Relations with the European Union Matilde Asi\u00e1n warned this week that the “absolute limitation” on the purchase of homes by foreigners – resident and\/or non-resident – “is not authorised” under European law.<\/p>\n
This comes after the nationalist party in power in the archipelago Coalici\u00f3n Canaria (CC) announced earlier this year that they intended to approach Brussels with a proposal to prevent non-resident foreigners from buying homes in the Canaries.<\/p>\n
READ ALSO: <\/b>Spain’s Canaries ask EU to help them limit foreigners buying homes<\/b><\/a><\/p>\n The Atlantic islands off the coast of Western Sahara are struggling with one of the worst housing crises of all regions in Spain. The rate of property purchases by more affluent foreigners – roughly 1 in 4 of the total – has been partly blamed for spiralling rents and property prices.<\/p>\n Advertisement<\/p>\n The goal of Coalici\u00f3n Canaria is to use the Canary Islands\u2019 status as an ultra-peripheric part of Europe to get the EU to make an exception for them even if limits on certain foreign buyers goes against the bloc\u2019s principles of freedom of movement of capital and people.<\/p>\n But it\u2019s unlikely to be smooth sailing for the party headed by Canary president Fernando Clavijo.<\/p>\n “Absolute restrictions, without justification, are not authorised under European law, and the Canary Islands government is studying every possibility,” Asi\u00e1n stated during her speech before the Parliamentary Committee on European Affairs and Foreign Action.<\/p>\n Asi\u00e1n stressed that the acquisition of second homes “is a movement of capital” regulated by the Founding Treaty of the European Union, which stipulates that restrictive measures on this free movement “must be justified by some exception contained in the treaties.”<\/p>\n She then pointed out that “certain restrictions” were maintained in the case of Bulgaria, Estonia, and Hungary’s entry into the EU, and that territorial provisions relating to “very specific” areas were also negotiated in the EU ascension process of Denmark, Finland, and Malta.<\/p>\n In the case of limiting the acquisition of real estate, Asi\u00e1n said that this must be “protected by compelling requirements” of general interest and be based on two principles: “non-discrimination and proportionality.”<\/p>\n Manual widget for ML (class=”ml-manual-widget-container”)<\/p>\n “These exceptions for reasons of general interest must be perfectly justified,” the minister said.<\/p>\n In her words, the Court of Justice of the European Union has established a “solid doctrine” establishing that “the acquisition of secondary residences in a certain geographical area can be limited as long as it serves certain purposes” such as guaranteeing the housing rights of a population in a territory and achieving an economic activity distinct from tourism.<\/p>\n Therefore, zonal restrictions on the acquisition of second homes may be possible in Canarias, but “always within these principles of general interest based on non-discrimination and proportionality to the intended goal.”<\/p>\n Advertisement<\/p>\n The reason why Asi\u00e1n\u2019s words are of particular importance currently is because limitations on property purchases by foreigners have been considered on several levels this year in Spain, including nationally.<\/p>\n Spain\u2019s Prime Minister Pedro S\u00e1nchez has made international headlines in recent months as a result of proposing a 100 percent tax on Spanish property purchases by people who don\u2019t reside in the EU, effectively doubling the price.<\/p>\n READ MORE: Who exactly would have to pay Spain’s 100 percent property tax?\u00a0<\/a><\/strong><\/p>\n At first, this was crossed off as political grandstanding at a time when his ruling Socialists have come under increasing pressure to resolve the country\u2019s deepening housing crisis, but then his party lodged a formal proposition in the Congress, suggesting that S\u00e1nchez actually means business.<\/p>\n Lawyers have already spoken up about the fact that such measures, if approved, will end up in EU courts.<\/p>\n