21 Oct 2020

What are the advantages of having a folio extract issued by a notary public?

The new Decree on Conditions for Issuing Extracts from the Ordnance Survey, Real Estate and Land Registry Information System, by Notaries Public and Surveyors (“Decree“) cuts through another piece of red tape – the need to apply exclusively to the Republic Ordnance Survey Authority for folio extracts.   However, the Decree is a source of some controversy in terms of application.  Will the Decree see us spend even more time queuing at counters and in consultation with experts?

The main innovations under the Decree are:

  1. When disposing of real estate and concluding other transactions before notaries, parties will no longer have to obtain a folio extract, nor will notaries be allowed to request that parties produce them. Notaries will obtain information ex officio via a Ministry of Justice app. Through the app, notaries will be able to download data from the central register of the real estate registry;
  2. A party may apply for a folio extract regardless of whether he/she is concluding other business at the notary’s office and regardless of the grounds for the folio extract application.  The notary will issue a folio extract as an electronic document, certified by a qualified electronic signature, i.e. a qualified electronic seal;
  3. Notaries may, via the app, apply for certificates of encumbrances and other annotations.

The layout of the folio issued by a notary public differed significantly to that issued by the Republic Ordnance Survey Authority.  A party who is non-au fait with law had doubts about data that an extract contains, which made interpretation more difficult.  Even those well versed in deciphering extracts issued by the Republic Ordnance Survey Authority agreed that the layout of extracts issued by notaries public left a lot to be desired in terms of ease of interpretation.  Ministry of Construction and Ministry of Justice recognized the importance of resolving the issue in the form of the extract.  (Some) questions have been answered – the form of the folio extract issued by a notary public will be identical to the form of folio extract issued by the Republic Ordnance Survey Authority.  Additionally, the folio extract issued by a notary public will contain a note that data has been provided via the information system of the Ministry of Justice and that the folio extract is a digital copy of the Republic Ordnance Survey Authority’s folio extract.

A new fee schedule for folio extracts has also been put in place.  Namely, there is a fee ceiling of RSD 540 extracts issued by notaries on foot of an application by a party.  That said, notaries will not be entitled to remuneration and reimbursement of expenses when obtaining data ex officio – for instance, when a real estate sale contract is concluded in the notary’s office.  In this case, the party will not be required to pay the administrative fee either.

Ambiguity remains, however – for example, is the RSD 540 fee chargeable per folio extract or per real estate listed in a folio extract?  The Republic Ordnance Survey Authority charges an administrative fee of RSD 940 RSD for folios up to 50 pages in length.  On the other hand, if a party applies for a folio extract in a notary’s office, it would cost RSD 540.  However, this does not rule out the possibility of a notary public charging RSD 540 for each real estate listed on a folio due to the lack of transparency concerning provisions on costs.   In that case, parties could end up payment much higher fees than if they had applied through the Republic Ordnance Survey.  Against that background, there is justification to question whether notaries’ fees cancel out the expected savings in time that would be lost queuing at Republic Ordnance Survey offices? The question remains open.  After the Ministries agreed on the layout of the folio, it could be said the agreed solution will ultimately speed up the transfer of property in Serbia.  Doubts regarding costs will remain.  The Ministry of Construction and Ministry of Justice should continue cooperating on this issue, to find an efficient (and cheaper) solution.

Authors: Suzana Dončić and Miodrag Jevtić