ErbbauRG

ErbbauRG, or the Erbbaurechtsgesetz, is a German federal law that regulates hereditary building rights (Erbbaurecht). It provides the legal framework for the creation, content, transfer, extension and termination of Erbbaurechte on land owned by another person, without transferring ownership of the land itself. The law is intended to facilitate long-term use of land for housing, commercial buildings, or other installations while the land remains in private ownership.

A typical Erbbaurecht is a dingliches Recht that binds a parcel of land for a fixed term, commonly 50 to 99 years. The Erbbauberechtigte (the right holder) may construct, maintain and use buildings or other structures on the land, while the landowner retains ownership of the ground. In return, the Erbbauberechtigte pays a periodic Erbbauzins (ground rent) to the landowner, with terms set by contract and subject to adjustment.

The right is created by contract and must be entered in the Grundbuch (land register) as a burden on the land. It can typically be transferred or pledged, subject to consent of the landowner, making it usable as collateral in financing arrangements.

Termination and renewal provisions are governed by the statute and contract. At the end of the term, the land generally reverts to the landowner unless the parties agree to extend the arrangement. Termination before expiration may occur under defined grounds, such as breach of contract or non-payment. The ErbbauRG also provides rules on compensation for improvements or other entitlements upon termination.

Practical significance: Erbbaurechte are widely used in Germany to enable long-term occupancy and development of land without full land ownership, influencing financing, property valuation and real estate transactions.