Acquisition of domestic real estate by residents (i.e.by natural persons who have a permanent residence in the Czech Republic or by legal persons which have their seat in the Czech Republic) or by non-residents (i.e. by natural persons who do not have a permanent residence in the Czech Republic or by legal persons which do not have their seat in the Czech Republic), is ruled by: Foreign Exchange Act No. 219/1995 Coll., as amended (most recently in the year 2000 by Acts Nos. 159/2000 Coll. and 362/2000 Coll. and in the year 2001 by Act No. 482/2001 Coll.

• Act No. 229/1991 Coll., on the Arrangement of ownership relations towards agricultural land and other agricultural property, as amended,

• Act No. 95/1999 Coll., on Conditions relating to the transfer of agricultural land and forests from the state ownership to ownership of other entities.

• Commercial Code, No. 513/1991 Coll., as amended (most recently in the year 2000 by Acts Nos. 30/2000 Coll., 367/2000 Coll. and 370/2000 Coll.),

• Civil Code, No. 40/1964 Coll., as amended (most recently in the year 2000 by Acts Nos. 227/2000 Coll. and 367/2000 Coll.).

According to the Czech legislation only residents and non-residents, who are Czech nationals, may buy real estate, agricultural land and forest in the Czech Republic. The Civil Code stipulates in § 133: "In the case of transfer of immovable property on the basis of a contract, the ownership title is gained by the entry in the Land Register, according to Act No. 265/1992 Coll., on the entry of ownership and other titles to real estate, as amended by Act No. 210/1993 Coll. In the case of transfer of immovable property, which is not entered in the Land Register, the ownership title is gained according to Act No. 344/1992 Coll., on the Land Register of the Czech Republic, as of the moment at which the contract comes into effect."

According to Article 17 of the Foreign Exchange Act, non-residents, who are not the Czech nationals, can acquire domestic real estate in the following cases:by heritage, which involves only the transfer of an ownership title (there are no restrictions on property inheritance, restrictions listed in Act No. 229/1991 Coll. on land ownership do not apply to these cases),

• for diplomatic representation of a foreign country under terms of reciprocity,

• if the real estate is to be acquired into unaportioned co-ownership of a married couple of which only one is a non-resident or where a non-resident acquires property from husband, wife, parents or grandparents,

• through exchange of domestic real estate, which he or she owns, for other domestic real estate the usual price of which does not exceed the usual price of the former real estate (according to Acts on property appraisal No. 151/1997 Coll. and No. 121/2000 Coll., a normal price is understood as a price which has been paid in the sale of equivalent or similar property or in the provision of identical or similar services in regular commercial transactions, as of the day of appraisal),

• if he or she has a pre-emption by reason of a proportioned co-ownership of real estate,

• if it is a construction built by non-resident on his own land,

• provided it is explicitly stipulated by a separate act (legislation on privatisation and restitution).

Non-resident legal entities with branches in the Czech Republic, which are registered in the Commercial Register of the Czech Republic, may acquire real estate, but they may not acquire agricultural land and forest. In other cases, the acquisition of real estate by non-residents is prohibited. This prohibition does not apply to a Czech legal person, which is owned partly or fully by non-residents. In particular, there is no limitation on the purchase of real estate by subsidiaries established by non-residents as subsidiaries are considered to be residents. Non-residents who are Czech nationals have the same rights as residents.

A special arrangement is included in new Act No. 95/1999 Coll., on Conditions relating to the transfer of agricultural land and forests from the state ownership to ownership of other entities, which entered into force on May 25, 1999. This Act, which is a piece of privatisation legislation, provides rules for the privatisation of agricultural land and forests in state ownership. According to this Act, state agricultural land can be acquired only by natural persons - Czech nationals, by municipalities and by public universities (for the training and research). Legal persons can acquire state agriculture land from the state ownership only if a building which they have already owned is built on it or if this land is indispensable for the use of such building. State forests can be acquired only by municipalities and public universities.

The term agricultural land is defined by Act No. 334/1992 Coll., on the Protection of agricultural land fund and covers: arable land, hop-gardens, vineyards, gardens, fruit plantations, meadows, pasture land an land which was and ought to be also in future cultivated for agriculture purposes, but is temporarily not cultivated. Agricultural land fund covers also ponds for breeding of fish or water fowl, non arable land which is necessary for the conduct of agriculture production, such as roads and tracks, land for irrigation, irrigation water reservoirs, drains, dikes against flood, etc. The term forests is defined by Act No. 289/1995 Coll., on Forests, and covers woods overgrowth with their environment and land designated to the fulfilment of the functions of wood.