Legal Environment for Business

Study case 1:

Asma Elhamel

Houda Guechchati

Houda Benmakhlouf

Maine Aitounejjar

Soufiane Chbani
Table of Contents

1. Introduction .......................................................................................................

2. What is the Real Property Conservatory System? ..............................................

3. What is the difference between Registered and Non-Registered Real Property?

4. What is the Procedure to Register a Land in the Real Property Conservatory

System? ...................................................................................................................
 Introduction:

Morocco is one of the most important market for potential and international investors who are

continuously buying real estate lands in order to make investments in the country. Thus, in

Morocco there are several reforms introduced by the Moroccan authorities that provides rights to

the investors. That is to say, the law system in Morocco is a little bit complex since there are

different legal regimes for the public lands (Habous or Guich) and the private lands that are owned

by the State. Let’s start by a brief summary of the origin of the Moroccan law. The Moroccan law

is a mix of the French legal system (French civil law system) and the Moroccan law (Sharia law)

as a result of the French protectorate. The French protectorate left a huge impact not only on the

culture but also on the language and on the law of Morocco. In fact, the Sharia law or the religious

law of Islam is basically a system of duties that guides Muslims in “a practical expression of

religious conviction and the goal of divine favour in the world to come” (Noel James Coulson &

Ahmed el Shamsy, 2019). Its main focus is on family and social issues. The Civil law system is a

codified system of law that deals mainly with the legal procedures, punishment and what is allowed

in a court.

1-Real Conservatory Property System:

Overall, the Real Conservatory Property System exists since the Greeks, Romans and Islamic eras.

In fact, it derives mainly from the Sharia law. The real conservatory property system establishes

real estate regulation that “ ensure sale of plot, apartment or building, as the case may be, or sale

of real estate project, in an efficient and transparent manner and to protect the interest of consumers

in the real estate sector and also to establish the Appellate Tribunal to hear appeals from the
decisions, directions or orders of the Real Estate Regulatory Authority” (CA Shankit Sharma,

2019).

During the Roman Empire, the lands were governed mainly by the aristocrats and the owners of

lands were obliged to give up on their lands. At the opposite, the Islamic property relied on three

main elements: First of all, no matter the size of the land, the latter has full right to be the owner

of his property in exchange of paying the liabilities related to this land such as paying taxes. The

second element would be that your lands needs to be ruled in accordance with the Islamic rules. In

other words, if the land is used to for agricultural or any other purposes, the owner needs to pay

taxes on it (also called the Khiraj lands). Last but not least, there are lands that owned by the State

and they are called Swafi lands .

The Real Property Conservatory systems gives real estate ownership and a mean that prevents any

conflict that may arise on the property. In the case of Morocco, the Real system is the result of

both the registered property law and the unregistered property in real conservatory system. The

unregistered real estate system is derived from Islamic law and the rule of civil law. The

unregistered properties are proved through al moulkiya in other words a land title that is confirmed

by the Adouls (Sharia law notaries) that a person who have the property needs to possess. The

registered properties derive from the French colonials (Modern Regime). Under this regime, all

lands should be registered in the real conservatory property system. That is to say through the land

registration, the owner disposes the right of possession (where he becames the landlord of the

property) and this can be used as evidence of title, facilitating the selling purposes of the property

as well as prevent against any unlawful disposal. Despite this regime, only 40% of the properties

in Morocco are registered because the procedures of doing so is time consuming and requires huge

costs to be made in order to register the property.

2-Differences between registered and unregistered real properties:

First, it is important to highlight the fact that before the introduction of the Real Property

Conservation System by the French colonizer in 1912, people used to adopt traditional methods

to assign or to keep their real properties.

An unregistered real property has the following characteristics:

 The absence of rights protecting the property and the property owners: The owners

of an unregistered real property have no legal rights over the property. In other words,

anyone can claim ownership of that property.

 Owners do not have information about their property: The owners of an unregistered

property do not hold information about the surface area, the price, and all the information

that could be attributed to a real property.

 Transactions involving the sale or the purchase of the property are not secure:

Unregistered properties are not protected by law, therefore, their owners cannot claim

legal ownership, and may lose their money if they had invested any.

 Unregistered properties cannot be used as a collateral: When banks issue loans, they

need collaterals from the borrowers. In the case of possession of unregistered real

properties, no loans can be issued because of the absence of legal ownership.

 The market value of the property is low: As more properties are being registered

nowadays, the value of unregistered properties drops significantly because of the absence

of legal ownership and legal protection.

However, on the other hand, a registered real property has the following characteristics:
 Owners have legal rights to the property: When a real property is registered, the owners

are legally protected by the law, because the state recognizes that the property is theirs. Upon

the issuance of the ‘real property title’ (Titre Foncier), the ownership is irrefutable.

 A registered real property can be used as a collateral: In case of a bank loan, owners of

registered real properties can use them as collaterals if they wish to. In that case, the bank

will be confident about the sale of real property in case the loan is not paid off.

 All information about the real property is recorded: When a real property undergoes the

registration process, all information about the surface, the value, the exact location, and the

owners, is recorded.

 The market value is larger than that of an unregistered real property: In case the owner

of a registered real property intends to sell, the value of the property is usually much more

expensive than if it were not registered. This is mainly due to the fact that the ownership title

passes with the transaction, and both the buyer and the seller are protected by the law.

 Title passes to the descendants in case of death: If the owner of a registered real property

passes away, the ownership immediately goes to his children.

 Registered properties have specific registration numbers: Once a real property is

registered, a specific and unique registration number is assigned and recorded along with

other information.

 Registered properties remain registered forever: Once a person decides to go for the

registration process, there is no way it can be undone.

3. Land registration process

As mentioned in the official website Ancfcc: the regular land registration process is composed of

7 steps :

1) Filling the requisition: The request can be filled by the owner, co-owner , beneficiary of

real rights , a creditor or the legal representative of a minor or an incapable person .

The application, supported by any act or document making known the right of ownership, is

presented to the service of land conservation.

2) Publication and display of the requisition extract (publication et affichage de l'extrait de

réquisition): The following step is advertising. The purpose of such step is to inform the public

that the registration of a property was requested by a person who claims ownership. Prospective

holders in the estate can now manifest their opposition to the process.

3) Then the Boundary operation It is both, a topographical operation, an act of publicity and a

legal inquiry on the real estate property. This operation is carried out by a Geometer-

Topographer Engineer registered on the “tableau de l’ordre national des ingénieurs géomètres-

topographes”, or a certified topographical technician of the cadaster service. The boundary

operation shall be carried out in the presence of the applicant or his representative and the parties

concerned by the date and time fixed.

4) The Topographic survey operation makes it possible to precisely determine the limits and

the consistency of the property.

5) Publication and display of the boundary fence: As soon as the demarcation plan is

received, we publish a boundary closure notice in the official bulletin and displays it at the

headquarters of the Court of First Instance, the Local Authority and the Communal Council, who

have jurisdiction over the place where the land is located. Oppositions are admissible until the
maturity of the two-month period following the publication of the above-mentioned property in

the Official Bulletin.

6) Final identification: This operation ensures that the base of the property required for

registration does not fall in the base of another registered property. It also looks if it does not

overlap with the borders of another or if it has been already subjected to a procedure other than

real estate registration.

· The final step is the conservator decision of registering, cancelling, rejecting or

transmitting to the court:

Registration: The Registrar proceeds to the registration and the establishment of the land title

after making sure that all formalities required by the law, the regularity of the request, that the

sufficiency of the documents produced and finally that no opposition was formulated.

Cancellation: The conservator can cancel the registration for the following cases:

Absence of an applicant or his representative during the boundary operations and not presenting

a valid excuse in the following month.

Non-execution of the boundary operation twice consecutively due to a dispute concerning the

building;

Applicant's non-diligence to follow the procedure within 3 months following the summons is

sent to him by the conservator.

Rejection: The Registrar rejects the application for registration in case of:

The irregularity of the request

The insufficiency of the documents produced.

7) Transmission of the file to the court: In case of opposition, the Registrar transmits the

application for registration and the relevant documents to the Court.

4. The steps that you should be taken so that the real property becomes registered in the
names of foreign investors

As talked about in the past segment, numerous residents have properties all through the kingdom
however in reality not many individuals have them enrolled under the studio framework. In
Morocco, enrolling a property under the studio framework is the best way to secure the land
resources and be perceived by the law as real proprietor. In addition, this enlistment enables the
proprietors to know the definite surface of the land by meters or hectares and not just by streams,
wells or trees isolating them with different terrains. That, however the enrollment licenses to know
the neighbors or the accurate proprietors of the terrains that encompass that real estate parcel, and
how much the land costs during that particular time frame. Then again of the range, concerning
the administration's side, the enrollment of terrains is critical for the accumulation of duties and
backing of the land tax collection framework. As indicated by the "Agence Nationale de la
Conservation Foncière du Cadastre et de la Cartographie", enrolling a genuine property entitles
the individual who registers it to a complete and unassailable title to land, and ensures the person
in question against any case or expulsion.

Any Moroccan resident who holds a specific property dependent on a "Melkia" has the likelihood
to standardize the responsibility for property and its enlistment in the Land Register. For the most
part, it takes around 9 months to productively enlist this section. Agreeing Cap Nord Property
Agency, (2015) individuals who can apply for a land enrollment are the accompanying:

 Holders of genuine rights or individuals who don't possess a structure or a house yet have
certain rights identified with the property.
 Beneficiaries of easements (bondages).
 Owners of a house, a townhouse, a ranch or a field.

The "notaire" ought to consistently check if the property is enlisted at the "Protection Foncière"
before beginning his work. On the off chance that the land isn't enlisted with its number and nitty
 gritty data in the "Preservation Foncière", the "notaire" will ask the person in question to initially
connect with an "Adoul".

Before knowing the various advances that a proprietor of a specific property the person in question
must follow so as to get his property enrolled, the individual should contract a land surveyor to
compute precisely, as far as possible, and land proprietors of the property. It isn't just a topographic
activity, yet in addition a demonstration of publicizing and lawful examination.

In Morocco, the land enrollment costs around 4.4% of the general property estimation. The
enlistment procedure has four stages, and goes on for around 46 days. The means are the
accompanying:

I. Confirmation of the Signatures of the Seller and the Buyer

The confirmation of the marks of the merchant and the purchaser last just a single day and
expenses:

 2 MAD for the mark.

 From 0.5% to 1.5% "notaire" charge for the full cost estimation.
 Stamp of 20 MAD per page.

Generally, each duplicate of the deed ought to contain around 5 pages.

In the event that a "notariat" deed is built up, the marks of the two gatherings in the business deed
must be guaranteed by an open "notaire". On the off chance that a private deed is marked, the two
gatherings ensure their marks themselves by heading off to the neighborhood specialists with their
national IDs such that the marks can be kept by applicable specialists. Individuals working in that
particular zone contrast their marks and the ones on the business deed. It is the main way that
permits legal advisors, legitimate advice, "notaire", or any other individual intrigued to know
careful the date and the number under which the deed was documented assuming, a short time
later, they have to ensure their marks. The property ought not have any issues, (for example, legacy
issues). The "notaire" is required to make what is classified "Discussion Judiciaire" to know
whether the property experiences any seizure. It permits the demonstration of passing
proprietorship from the vender to the purchaser conceivable. A property than has issues can't be
sold until every one of the seizures are illuminated by neighborhood specialists. The "notaire"
ought to likewise check if the land's worth could be influenced by a limitation because of the land's
forerunners. In this way, the documentation contains two primary things: the business
understanding marked by the gatherings and the ID cards including the date and the sequential
number under which the deed was recorded.

II. Status of the Land

This progression needs a great deal of examination. The common law or "notaire" takes a gander
at the land number to affirm that no home loan is expected and that the vender is the genuine
proprietor. On the off chance that an individual possesses the property, the "notaire" ought to get
what is brought in French "Indivis Immobilier". In any case, if the property is possessed by a
specific organization, the person in question should check if that property can be sold or not. In
the event that the individual owning a property has a home loan, the individual in question must
compensation the sum because of the bank so as to get a report that supports that the proprietor
has paid his obligation called "Fundamental Levée".

III. Acquire Tax Clearance Certificate

The "notaire" ordinarily goes to the duty specialists (Direction des Impôts) to check whether any
unpaid charges are owed on the property. The expense organization as a rule takes between 30 to
45 days to check this issue and afterward, if no issue is experienced (If in this way, the vender
must cover his regulatory expenses all together for the exchange to be made), the assessment
organization can issue the declaration brought in French "Certificat Négatif".

IV. Is the land an Agricultural Land?

The "notaire" must counsel the urban organization to check if the land is rural. This progression is
extremely valuable for the purchaser particularly in the event that he is an outsider since it is
carefully precluded to all outsiders to secure any agrarian land in the Moroccan region except for
non-rural business. As such, an outsider has the option to get a horticultural land just on the off
chance that it will be utilized for agro-mechanical or completely modern certainty.

V. Enrollment of the deed

  The span of this significant advance consistently keeps going close to 5 working days.
 The deed is enrolled following a month from the date of the deed
 It costs 2.5% of property value (enrollment obligation)
 According to Article 4 of the Registration and Stamp Code, the business deed ought to be
enlisted in the enrollment office where the property is found.

VI. Application for the engraving of the enrolled deed on the land recorder (Conservation
Foncière)
 Takes around 3 days.
 Costs 1% of the estimation of the property + some extra different expenses.
 Paid at the land vault
 Buyer applies for the posting of the enrolled deed on the land enlisted.
 Listings ought to be done inside year and a half from the date of drafting the deed for real
deeds and as from the date of the confirmation of the last signature from private deeds.
 If timing cutoff times are not regarded, candidate is fined 100% of the relative obligation
payable
Any person that requires posting must document an announcement with the land enlistment center.
So as to sell a property, the accompanying records ought to be all present:
 Personal data of both the purchaser and the merchant: names, ID numbers, societal
position, date of birth, spot of birth, and nationality.
 Description of land title number or working to be recorded, surface of the
land/building/condo.
 Nature of right due to be recorded.
 Acquisition technique for deed.
 Nature and date of deed affirming it.
 The careful cost in MAD.
 The nonattendance of a home loan or a credit on the land.
 Formalities of installments: if the sum to be paid to be paid will be in parts or altogether,
in real money, by wire move, or with a money order. Be that as it may, if the purchaser is
a remote individual, a wire move ought to be produced using his/her record and changed
to Moroccan cash.
The announcement with the land recorder is marked by the purchaser and merchant, and ought to
incorporate either a unique duplicate or credible duplicate of the deed as a connection to the
application.
At last, if there are no complaints, the recorder continues to the enrollment by building up a
property title which is designated "Titre Foncier" for the sake of the new proprietor. This title
reflects similarly the physical and lawful status of the recently enrolled property in the "Protection
Foncière", and gives full privileges of enlisted proprietorship joined to the property.

Conclusion:
Through this paper, we had the option to become familiar with a framework brought to us by the
French by the name of “Système de la Conservation Foncière”. We were additionally ready to
have an engaged take a gander at three significant lawful callings. Be it filling in as an Adoul,
Notaire or Lawyer, every one of the three accompany their obligations. None can be viewed as
superior to the next one as, some of the time, they all need to cooperate to save the privileges
everything being equal, be it local people or outsiders.
References:

Coulson, N. J., & Shamsy, A. E. (2019, September 18). Sharīʿah. Retrieved from

https://www.britannica.com/topic/Shariah.

Introduction to Real Estate (Regulation & Development) Act, 2016 (RERA). (n.d.). Retrieved

from https://taxguru.in/corporate-law/introduction-real-estate-regulation-development-

act-2016-rera.html.

Vocabulary Online Dictionnary. Retrieved from

http://www.vocabulary.com/dictionary/lawyerndix