Everything you need to know about the Law Breyne

02/08/'23

Everything you need to know about the Law Breyne: Protecting consumers in real estate in Belgium

The Law Breyne, adopted in Belgium on July 9, 1971, is a fundamental legislation aimed at protecting consumers when they enter into contracts with contractors for the construction or renovation of their homes. Its objective is to protect buyers regarding property transfer, payment of the price, completion guarantee of the work, and receipt of the property.

1. What is the Law Breyne and who does it apply to?

The Breyne Law is specific legislation in Belgium that governs construction contracts, off-plan sales (VEFA), and real estate development. Its primary aim is to protect consumers, defined as natural persons acting for purposes that are outside the scope of their professional activity. It also applies to legal entities that acquire housing for the needs of their members.

2. Key provisions of the Law Breyne

a. Reflection and withdrawal period: Before signing a contract, the consumer has the right to a 7-day reflection period during which they can withdraw without incurring any costs or penalties.

b. Written and detailed contract: The contractor is required to provide a written and detailed contract that specifies the total price, planned works, payment schedules, and contract execution conditions.

c. Staggered payment: The Law Breyne imposes a staggered payment system that protects the consumer against excessive advance payments.

• First rule: No payment can be demanded before the contract is signed.

• Second rule: The deposit cannot exceed 5% of the total amount.

• Third rule: The seller or contractor must provide a bank guarantee that protects the buyer against possible insolvency in case of work non-completion. The total payment can only be made in installments, and the total amount can never exceed the price of the completed works.

d. Ten-year guarantee: The contractor is liable for hidden defects and serious flaws for a period of 10 years after the completion of the works.

How does it apply?

For the Law Breyne to apply, three conditions must be met:

• The building must be intended for residential use or mixed use (residential and professional) in balanced proportions.

• The seller, developer, or contractor undertakes to (have) construct or procure a building. If multiple contractors are involved (with multiple contracts), the law no longer applies.

• The buyer or client pays one or more deposits before the completion of the works.

And what about the real estate agent?

The role of the real estate agent is not limited to being an intermediary between the seller and the buyer. They have obligations to fulfill and are liable for their actions. For example, if they establish a private sales contract, they will be responsible for the legal consequences of that act for both parties. They are not mere executors acting on behalf of the principal! It is their responsibility to inform the parties about the content and scope of the Law Breyne.

3. Consequences of non-compliance with the Law Breyne

In case of non-compliance with the Law Breyne by the contractor, sanctions such as fines or criminal penalties can be applied. Moreover, the consumer can pursue different remedies, such as contract resolution, claims for damages, or even contract nullification.

Conclusion

The Law Breyne is a crucial tool to protect consumers when undertaking real estate projects in Belgium. By knowing their rights and relying on the provisions of this law, consumers can benefit from better legal protection during the execution of their construction and real estate purchase projects. The Law Breyne plays an essential role in balancing the relationships between contractors and consumers, promoting greater transparency and quality in the construction and real estate sector.