This week, the Ministry of Defence of Finland (Puolustusministeriö) announced that it has rendered a number of negative decisions on third-country national trying to acquire immovable property (real estate) in the name of public security.
Article 63 TFEU on the free movement of capital in the EU provides for the possibility of persons to acquire physical immovable property in Member States. Article 65 TFEU, however, lays out a number of potential exceptions to this, including public security. However, any grounds of potential exception from free movement has to be exercised in line with the principle of proportionality.
Finland introduced a new law in 2020 which demands that non-EU/EEA nationals must go through a prior authorisation process to acquire immovable property in the Member State. Three negative decisions were rendered this week, when natural and legal persons, Russian persons and businesses, tried to acquire immovable propert in Ruokolahti and Kitee.
The reason for the three negative decisions, was, in the Ministry’s view, ‘can be considered to hinder the organisation of national defence or the surveillance and safeguarding of territorial integrity’. Whilst this in itself is not a full proportionality assessment, in as far as the public announcement went, obviously it remains possible for the potential acquirers in question to challenge the lawfulness of these decisions before the administrative courts of Finland, as to their compatibility with EU law, and in particular, the free movement of capital.
More on the announcement by the Ministry of Defence can be read here.