Expropriation in Spain: Legal Framework, Process, Compensation, and Reversion Rights

Expropriation is legally defined as the process by which a public authority acquires private property without the owner’s consent, provided that such acquisition is justified by the purpose of public utility or social interest and subject to fair compensation.

In legal terms, few state actions impact property rights more profoundly than the compulsory transfer of ownership. While expropriation may serve legitimate public purposes—such as the construction of roads, railways, ports, or public housing—it also generates deep concern among citizens, given that the process involves relinquishing one’s property, sometimes unwillingly, to the administration.

This report aims to provide a detailed and accessible overview of the Spanish expropriation process, its legal foundations, key procedural stages, types of assets subject to expropriation, and the rights of the affected property owner, including the right of reversion.

Legal Basis for Expropriation in Spain

Expropriation in Spain is governed by a robust legislative framework, primarily:

Ley de Expropiación Forzosa (1954) – the Law on Compulsory Expropriation.
Reglamento de 1957 – the regulatory development of the 1954 law.
Royal Legislative Decree 2/2008, of 20 June – the current consolidated text of the Spanish Land Law (Texto Refundido de la Ley del Suelo).

These legal instruments empower different levels of government—State, Autonomous Communities, Provinces, Municipalities, and Islands—to carry out expropriations, provided that the measure is justified and follows a rigorous legal procedure.

The Principle of “Public Utility”

A cornerstone of lawful expropriation is the declaration of public utility (declaración de utilidad pública). Without this formal declaration, no expropriation can proceed. This requirement ensures that property can only be expropriated when the asset is essential for a public interest project such as:

Transport infrastructure (roads, railways, airports).
Public services (schools, hospitals, public parks).
Utilities (water supply systems, electricity grids, sewage).
Strategic developments (military installations, environmental conservation).

The declaration must be made by public institutions only—private entities, including public corporations such as RENFE or ADIF, cannot directly expropriate. The responsibility, for instance, lies with the Ministry of Transport and Public Works (Ministerio de Transportes, Movilidad y Agenda Urbana).

What Can Be Expropriated?

Although expropriation most frequently affects real estate, the legal concept extends to any private right or asset that may be deemed essential to a public interest. This includes:

Land and buildings.
Movable property (vehicles, machinery, artwork).
Intangible rights (easements, leases, shares, bonds).
Contractual rights or licenses.

The Expropriation Procedure in Spain

1. Declaration of Public Utility

The process begins with a formal declaration of public utility through a governmental act (often by the Council of Ministers). In urgent cases, this declaration may be implied if the public interest is evident, and the need is immediate.

The project and the list of affected assets must then be published in:

The Boletín Oficial del Estado (BOE).
The Official Gazette of the Province.
One of the most widely circulated local newspapers.

2. Public Information and Allegations

Once published, the procedure enters a 15-day period of public consultation, during which affected individuals can:

Review the expropriation plan.
Submit observations or objections regarding technical errors or legal flaws.

After this, the administration has 20 additional days to review and respond. Once resolved, it issues a formal declaration of necessity of occupation (declaración de necesidad de ocupación), which must be individually notified to all affected owners. This individual notification is mandatory; failure to comply may render the entire process null and void.

3. Owner’s Right to Challenge

Although property owners cannot oppose the expropriation once public utility is declared, they may:

Challenge the declaration of public utility or
Contest the necessity of occupation, particularly for procedural defects, before the administrative courts.

Once officially notified, the owner has 10 days to submit objections. The administration must resolve these within 20 days. During this time, the procedure is suspended for up to 30 days.

Compensation: The “Justiprecio” or Fair Price

Once the necessity of occupation is confirmed, the owner is entitled to receive fair compensation, known as Justiprecio. This compensation is intended to reflect:

The market value of the property or right.
Damages or losses caused by the expropriation (loss of income, relocation costs, etc.).

Friendly Settlement

The law encourages a friendly settlement within 15 days. If both parties agree on the amount, the process concludes.

If No Agreement Is Reached

If no agreement is possible:

The owner submits a proposed valuation (Hoja de Aprecio) within 20 days.
The administration can:
- Accept it and pay the proposed amount.
- Reject it and present its own counter-valuation.
If disagreement persists, the case is referred to the Provincial Expropriation Jury (Jurado Provincial de Expropiación).

These independent bodies, present in each provincial capital (e.g. Alicante, Valencia, Almería, Murcia, Málaga), are composed of legal, administrative and technical experts. Their resolution is binding but can be appealed to higher courts.

Delays and Additional Compensation

If the administration fails to:

Resolve within six months, interest is added to the compensation.
Pay within two years, a revaluation (retasación) of the property is required to reflect the updated market conditions.

Reversion Rights: Can the Owner Recover the Property?

The right of reversion (derecho de reversión) is a legal safeguard designed to protect owners in cases where:

The expropriated land is not ultimately used for the declared public purpose.
No public works are undertaken within two years of the property being taken.
The intended use is abandoned or changed to a non-public purpose (e.g. commercial exploitation).

In these cases, the former owner (or their heirs) may request the return of the property by repaying the compensation received, adjusted for inflation.

Exceptions to Reversion

Reversion is not applicable if:

The land is repurposed for another legitimate public utility.
The land has been used for public purposes for more than 10 years.

Final Remarks and Legal Advice

The expropriation process in Spain is highly technical, regulated, and often involves significant negotiation and litigation. While authorities are empowered to act in the public interest, owners retain important rights related to procedure, valuation, and reversion.

Due to the complexity and long duration of expropriation procedures—particularly in major infrastructure projects (e.g. AVE high-speed rail lines, motorway expansions, or urban redevelopments)—it is strongly advisable to seek specialised legal advice.

At TLA Corp, we provide full legal representation for foreign and national property owners facing expropriation across Spain, including in high-density infrastructure regions such as: