The importance of the Occupation Licence

Welcome to another article from Meridional. Today we’ll be discussing the importance of the first-occupancy licence. 

Among the documents we need to check when buying or selling a property is the first-occupancy licence.

It is important to have all the necessary information and tools to hand before you begin the process.

In this way, we can ensure that the transaction is carried out as efficiently and quickly as possible.

Broadly speaking, it can be defined as the document which verifies and guarantees that a property has been built or refurbished in accordance with the technical specifications set out in a previously approved construction plan.

This basically means that the property meets all the requirements and safety standards for residential use. Below, we set out the basic information you need to know about this:

Why is it necessary?

Most people wonder whether they need to hold or apply for this type of licence to convert a house or flat into tourist, holiday or short-term accommodation. The answer is yes. Below, we explain why.

• Firstly, this is obvious from the change of use. Furthermore, this document confirms that the property meets the habitation requirements. Therefore, both this document and the declaration confirming the start of operations are essential for obtaining the tourist licence. Without it, you will not be able to legally register your accommodation.

• It is the only way to legalise your building.

• Essential for to arrange for the supply of water, electricity or gas: Companies cannot provide these services if you do not have a first-occupancy licence, as they would be supporting an unauthorised dwelling, which is not in compliance with the regulations.

• Only with a tourist licence can your guests be assured that the accommodation they are staying in is fit for purpose and complies with all the necessary regulations and laws.

• It is not possible to carry out a deed of conveyance for the property without this report: therefore, a legal sale cannot take place without going through this procedure.

• Finally, if you wish to use a property for tourist purposes, you will probably need to carry out some renovation or building work, which may require you to apply for this document or a similar one.

When should you apply for an occupation licence?

It is compulsory in all newly built buildings and homes. It is also required when carrying out a comprehensive refurbishment or when undertaking building works that change the use of the property or alter any part of the home.

The same applies if you wish to occupy an old house, an office, premises for commercial use, etc.

Under current legislation, an initial occupancy licence must be applied for in the following cases:

• If you’re building your own home and are going to live in it for the first time.
• If you have carried out renovation work that has resulted in an extension or a further alteration to the space.
• If you have converted a flat, house or building into an office or commercial premises.

Below, we set out everything you need for your application: 

• NIE of the applicant. 
• Final completion certificate. This is the document drawn up by the architect and the structural engineer once the building works have been completed, and it must be endorsed by the relevant professional body. 
• Certificate of Final Acceptance of the Works. 
• Telecommunications Bulletin with details of the installation of telecommunications services. 
• Report on utility companies on the connection system. 
• Planning permission. 
• The technical certificates compliance with fire safety regulations and electrical installation certificates. 

How and where do you apply for this document?

All administration and processing of this document falls within the remit of the local councils; each council sets its own conditions, procedures and formats. You can apply for it whether you are a property developer or the owner of the property in question.

The steps you need to follow at the Town Hall are as follows:

• Application for a first-occupancy licence.
• Proof of payment of fees.
• Documentation relating to the completion of the works.
• As-built drawings or a report detailing alterations (in the case of refurbishments).
• Property rating, compulsory for Social Housing (VPO).
• Certificates for electrical installations and supplies, telecommunications or water (required for both first-occupancy licences for dwellings and licences for the use of a property).

In light of the above, the local authority’s technical staff will check that the building work complies with the technical plans and that everything is in accordance with current legislation. Should any errors or discrepancies be found, a period will be set aside to rectify them. The local council itself will then take charge of the relevant administrative procedures.

There is no specific deadline for applying for this permit. It will largely depend on the workload of the technical staff and the procedures followed by the local council itself.

Our advice is to apply for the first-occupancy licence once the building work has been completed. That way, you’ll be able to submit all the necessary documentation without any problems.

If everything is in order, you should normally receive a reply within three months at the latest. If you do not receive any information within that time, your application may have been rejected by administrative silence. We advise you to find out what has happened and take the appropriate action. 

What does the local council certify?

• That the The work has been fully completed and complies with the planning permission granted. (Judgments of the Supreme Court of 24 November 1973, 16 July 1992, 14 December 1998, 2 October 1999, 21 July 2001 and 8 November 2003, and Article of Galician Housing Act 8/2012).
• Despite this, it is common for this planning permission to formalise any alterations made during construction that can be legalised in accordance with the applicable town planning regulations.
• The administration cannot refuse the first-occupancy licence for reasons unrelated to its intended purpose.

What is the City Council refusing?

However, it can refuse the granting of the licence on the following grounds:

• Failure to comply with the obligation to build as set out in the town planning scheme or planning permission (judgements of the Supreme Court of 29 March 1983, 30 October 1995, 25 March 1998 and 23 June 1998).
• That the building or dwelling meets the requirements necessary to be intended for domestic use. This is the administrative act that legitimises the use of the building, granting its holders a vested right to use it, notwithstanding any subsequent changes to the regulations. If this licence is not held, an order may be made to shut down and close the premises for the purposes for which they are currently being used carried out without authorisation, and without any limitation period applying. Consequently, case law has consistently held that such use is not subject to any limitation period and that, therefore, the right to take action to restore compliance with town planning regulations does not lapse at any time.
• To ensure that the building complies with the technical requirements relating to public safety, health and aesthetics (Supreme Court judgements of 22 December 1976, 7 February 1984, 27 March 1991, 14 December 1998 and 21 July 2001).
• To allow the building or structure can connect the supply drinking water, electricity, telecommunications and other community services. Should this licence not be held, the local council is obliged to cut off the supply, following a hearing with the person concerned (Article 43 of Galician Housing Act 8/2012).
• Its granting it is compulsory and prior to authorisation (by a notary) and registration (at the Land Registry) the title deed for the completed new-build property (Article 44 of the Galician Housing Act). This is a guarantee for third-party purchasers, ensuring that they may, at all times, purchase buildings and properties that hold a first-occupancy licence. The aim is to prevent purchasers acting in good faith from buying properties which subsequently encounter problems with the local council regarding the restoration of their legal status.

How many types of occupation licences are there?

There are three types of first-occupancy licence:

1. For new-build buildings.
2. Intended for those that have undergone substantial alterations (a clothes shop that is to be converted into a dwelling, or vice versa).
3. For those who have changed the use of their property (office, home, etc.).

How does it work in the different communities?

There are various ways to confirm that the property you wish to move into meets the minimum standards of habitability. We recommend finding out about the exceptions and specific requirements in each autonomous community. The process for obtaining a first-occupancy licence on the Costa del Sol will differ from that in Madrid.

Other things you should also be aware of:

Do not confuse a first-occupancy licence with certificates of fitness for habitation

One of the biggest misconceptions is that people get confused because they look similar, but they are not the same. The certificate of occupancy is simply a document certifying that a building or property is fit for habitation. It is usually required when you set up basic utilities, or when you rent out or sell a property.

But that does not mean we would have a supply of electricity, water, gas, etc. Nor would we be able to sell or buy a property that lacks these services, as this is one of the requirements which, as we have already mentioned, guarantees the purchase of that property.

Is this a compulsory document?

It is the only way to certify the construction of a new residential building and/or a comprehensive refurbishment, subject to a prior planning permission, and is required for the procedures leading up to the transfer of ownership of the property (signing the final works certificate, arranging utility connections, etc.)

Finally, we’d like to thank you for taking the time to read our article on the first-occupancy licence. We hope you’ve found it helpful. What did you think of the information provided?