Planning blight

Planning blight

In certain cases, a planning decision may result in damage. Examples include damage in the form of a decrease in value or loss of income of real estate. A right to compensation does not arise in all situations involving a planning change. The damage suffered must be disproportionately severe. Furthermore, the injured party must not have been able to foresee the damage.

A request for compensation must be submitted to the municipality. If the municipality does not award the compensation (in full), legal proceedings can be initiated in court if necessary. Our lawyers and legal experts are experienced in submitting requests for compensation and initiating legal proceedings.

Questions regarding planning blight? Contact us.

When are you entitled to compensation for planning damage?

Not every planning change leads to compensation. To be eligible for compensation for planning damage, a number of conditions must be met. There must be a cause of damage designated by law, the damage must exceed normal societal risk, and you must be disproportionately affected compared to others. Additionally, the damage must not have been foreseeable at the time you purchased or built the property; in that case, acceptance of risk applies.

The damage can be broadly divided into two forms: depreciation of real estate and loss of income, for example because a shop or hospitality business loses customers due to a changed traffic situation. Whether you are representing an international real estate fund or the baker on the corner whose turnover is declining due to a new construction plan across the street: the assessment framework is the same; the facts and the burden of proof determine the outcome.

Direct and indirect disadvantage (planning blight)

Within planning damage law, a distinction is made between direct and indirect disadvantage. In the case of direct planning damage , your own plot or property is affected, for example, because the building or usage possibilities of your own land are restricted. In the case of indirect planning damage, the cause of the damage lies on a neighboring plot: consider the construction of an apartment complex or business park in your immediate vicinity, causing your home or business property to decrease in value due to loss of view, privacy, sunlight, or increased nuisance. This distinction is important because the calculation of the damage and the level of normal societal risk depend on it.

Planning blight under the Environment and Planning Act: compensation for disadvantage

Since the entry into force of the Environment and Planning Act on 1 January 2024, the classic concept of planning blight from Article 6.1 of the Spatial Planning Act (Wro) has been incorporated into the broader scheme for compensation for disadvantage. This scheme is found in Section 15.1 of the Environment and Planning Act, in conjunction with Title 4.5 (Article 4:126 et seq.) of the General Administrative Law Act. Substantively, the core remains intact: you can claim compensation for damage that lawful government action causes you disproportionately.

An important difference is the moment of damage. Under the Spatial Planning Act (Wro), damage generally arose as soon as the spatial planning decision became irrevocable. Under the Environment and Planning Act (Omgevingswet), damage is only determined at the moment an activity is actually carried out or permitted, for example when the environmental permit is granted or the actual work begins. This directly affects the zoning plans (now environmental plans) and the environmental permits to which the damage can be traced. Whether your situation still falls under the Wro or already under the Environment and Planning Act depends on the transitional law; this determines your chances and the correct timing of your application.

Normal societal risk and the flat rate

A portion of the damage always remains at one's own expense: the normal societal risk. The underlying rationale is that anyone living or doing business in a dynamic environment must accept a certain degree of planning change. Under the old Spatial Planning Act (Wro), a statutory minimum flat rate of 2% of the value of the real estate prior to the damage-causing development applied to indirect planning damage due to a decrease in value.

Under the Environment and Planning Act, this flat rate for indirect damage in the form of depreciation has been increased to a fixed percentage of 4%. This fixed flat rate was introduced to increase predictability. Above that flat-rate portion, the administrative body may deduct a higher societal risk, depending on the circumstances. It is precisely on this point that much can be gained or lost: the justification for the deduction is often open to debate, and it is advisable to have it critically reviewed.

Risk acceptance: active and passive

The government may reject an application on the grounds of acceptance of risk. In the case of active acceptance of risk, you purchased the real estate at a time when the adverse development was already foreseeable, for example because a draft decision or policy intention had already been made public. In the case of passive acceptance of risk, you are accused of failing to utilize an existing, favorable building or usage opportunity while knowing that it would disappear. Under the Environment and Planning Act (including Articles 15.5 and 15.6 of the Environment and Planning Act), specific conditions and time limits apply to this. A timely and well-documented response can prevent you from forfeiting your entitlement.

The planning compensation procedure: from application to administrative court

You submit the application for compensation to the competent authority, usually the municipality. The administrative body typically engages an independent expert or a damage assessment committee to provide advice on the causal link and the amount of the damage. Based on this, the administrative body makes a decision. Many municipalities charge fees or a threshold amount for processing the application; in principle, this amount is refunded upon approval.

If you disagree with the decision, you have the right to an objection , followed by an appeal to the administrative court, with the possibility of a further appeal to the Administrative Jurisdiction Division of the Council of State. Our lawyers and in-house counsel critically review the expert opinion, engage their own appraiser where necessary, and conduct the proceedings up to and including the highest instance.

Deadlines for your application

An application for compensation for loss is subject to a limitation period. Pursuant to Title 4.5 of the General Administrative Law Act, you must in principle submit the application within five years of becoming aware of both the damage and the decision causing it. Do not wait too long: your entitlement lapses after this period expires, and in the case of depreciation, the moment of sale also plays a role in the burden of proof. If you are unsure whether your time limit is still running, submit the case early.

Planning blight within environmental law

Planning blight rarely stands alone. A damage claim is almost always linked to the broader context of environmental law: the environmental plan, the granting of permits, and spatial decision-making within your municipality. Often, a planning blight process runs parallel to a procedure regarding spatial planning or the underlying zoning plans. If you suffer damage due to lawful government action that does not fall under classic planning blight, the broader disadvantage compensation may apply. We review your situation comprehensively so that no entitlement remains unexploited.

What MKB Juristen does for you

At MKB Juristen, you work with mixed teams of lawyers and in-house counsel who are experts in environmental law. We assess whether there is a realistic chance of compensation, prepare a substantiated application, consult with the municipality and its expert, and litigate where necessary. Our clients range from property developers, housing corporations, and industrial concerns to private owners and the independent entrepreneur around the corner. The same approach applies to each of them: sharp on the facts, clear about the chances of success, and without unnecessary costs.

Frequently asked questions about planning blight

Is planning damage now called disadvantage compensation? Since January 1, 2024, planning damage falls under the general disadvantage compensation scheme of the Environment and Planning Act and the General Administrative Law Act. In practice, the term planning damage is still widely used for damage caused by changes to spatial planning.

Which part of the damage will I not be reimbursed for? The normal societal risk remains at my own expense. For indirect damage due to depreciation, a fixed flat rate of 4% applies under the Environment and Planning Act (2% under the old Spatial Planning Act), possibly increased based on the circumstances.

Within what timeframe must I apply? In principle, within five years after you became aware of both the damage and the decision causing the damage.

What does a procedure cost? Municipalities usually charge a threshold amount or fees, which are refunded upon approval. We make clear agreements in advance regarding the costs of our assistance.