Legal Framework of the Occupation of Coastal Public Properties

Decision No. 144/s of 1925

General Saray, High Commissioner of the Republic of France to Syria, Greater Lebanon, the Alawis and the Mountain of the Druze issued on June 10, 1925 decision No. 144/s to govern public properties including coastal ones. Despite being 75 years old, the law is still in force today.

The decision stipulated that public property should not be sold, nor should ownership over it be acquired with time. The seaside, including the farthest distance that waves can reach in winter in addition to sand and gravel beaches, makes part of public property. The state and the municipalities have the right to issue temporary occupancy licenses for these properties for a period of one year that may be renewed by tacit consent, granted that the occupancy fees are mentioned in the working or occupancy licenses.

Decree No. 4810 of 1966

Decree No. 4810 dated June 24, 1966 manages the disposition of coastal property and contains major provisions aimed at protecting such property:

• Coastal public property shall remain at the disposal of the public and no one shall have the right to use it in favor of a personal or private interest, unless in exceptional cases where the project bears a public aspect and has justifications for tourism or industry.
• Permanent facilities may not be erected on coastal public property except for sporting facilities measuring no more than 5% of the total area of the property and rising no more than 6 meters in height.
• License seeker should own a property neighboring the coastal public area he wishes to occupy, provided that such area is at best twice as big as the private adjacent property.

Decree No. 2522 of 1992

Decree No. 2522 dated July 15, 1992 cancelled the first article of Decree No. 12841 issued on May 25, 1963 and imposed new tax rates consistent with the appraisal of every square meter. The decree divided the Lebanese coast into 30 zones, each having a specific rating. Occupiers were to pay for each square meter lump-sum fees ranging from LBP 10 000 (from North Lebanon to the north border of Mennieh) to LBP 1 250 000 (from the northern side of the Normandy dump to the southern side of the plot including Abella Hotel in Jnah). The following rule is used to determine the annual fees:

Occupancy fee= Occupied area × value of a square meter × 0.50% (or 0.75% or 2% or 0.1% depending on the nature of the facility- See the example in the following box).

The decree permitted free reclamation of the sea area provided that the license holders do not impose fees on the boats and yachts using the waters or prohibit citizens from using them. Otherwise, they will be subjected to taxation at a proportion of 1 per thousand.

Status of the Occupied Areas of the Coastal Public Property

The occupied areas of the coastal public property are divided into 6 categories:

• Areas amounting to 876 000 m2 licensed and legalized by virtue of government decrees prior to the 1975 civil war. Occupiers of these areas pay their dues to the Lebanese state (Table 1).
• Areas amounting to 1 952 827 m2 licensed by virtue of permits issued between 1990 and 2012. Occupiers of the majority of these areas pay the fees required of them and include municipalities and other public institutions like the Council for Development and Reconstruction (Table 2).
• Areas violating and overstepping the occupancy permits issued by virtue of government decrees. These areas stretch across 43 000 m2 and their occupiers pay for the licensed square meters only, not the ones they encroached upon (Table 3).
• Unlicensed areas amounting to 1 500 000 m2 and occupied during the war and the years that followed. Controversy over these areas might be resolved as their occupiers have ownership over adjacent private property (Table 3).
• Unlicensed areas amounting to 650 000 m2 and occupied during the war. It is unlikely that the dispute over these areas will be settled as their occupiers have no adjacent private property.
• Areas occupied by governmental entities or municipalities without obtaining a permit.

Coastal Occupancy Revenues

According to Decree No. 2522/9, the annual fees that the state charges on the legally occupied seafront properties do not exceed LBP 4.3 billion. The Cabinet discussed a draft decree aimed to raise those fees to LBP 15.7 billion per year, but to no avail. The draft decree still falls short of giving the state its fair share of income from Lebanon’s shores as no fees are being collected from the aggressors, which encourages further violations. However trivial the revenues channeled to the state, it is also unreasonable to impose higher fees on the licensed occupiers while exempting the illegal ones, whose annual revenues are estimated at USD 200 million.

How are the annual fees calculated?

To calculate the annual fees that occupiers must pay, the following is adopted:

• Swimming pools and baths without dormitories owe the state a fee amounting to 0.5% of the value of the existing or reclaimed land they occupy, 0.1% of the open water area and 1% of the closed water area.
• Seaside hotels and resorts for tourists owe the state a fee amounting to 0.75% of the value of the occupied land, 0.1% of the open water area and 1% of the closed water area.
• Industrial and commercial facilities owe the state a fee amounting to 0.5% of the value of the occupied land, 0.1% of the open water area and 1% of the closed water area.
• Facilities for private use owe the state a fee amounting to 2% of the value of the occupied land, 0.1% of the open water area and 0.5% of the closed water area.
• Agricultural facilities owe the state 0.1% of the value of the occupied land.

For instance, he who obtains a license to occupy 2000 m2 in SOLIDERE, where the square meter is set at LBP 9 million, should pay an annual fee of LBP 135 million if there were dormitories involved, and LBP 90 million if none. The fee constitutes 0.5% of the total value of the property amounting to around LBP 18 billion, which is far less than the percentage of fees adopted in land and property and standing at 6%. The occupier will then have to pay an annual fee of LBP 1 billion.

In a nutshell, the status of the coastal public properties is the following:

• Some licenses have been given prior to 1975 and afterwards straight until 2012, but the occupancy fees are extremely low compared to the value and location of the property. The amendment of the 1992 decree can raise the state annual revenues from LBP 4.3 billion to LBP 15.7 billion but won’t be enough as the percentage fees must be set at 6%, not 0.5% of the property value.
• The encroachments on coastal properties are committed by a minority of occupiers who had obtained legal licenses in addition to other illegal individuals and companies who have infringed on public property without permission or licensing. The state stands helpless as to the collection of fees from owners of those investment projects who are mostly political parties or entities obstructing the issuance of a law or a decree to collect the revenues which some have estimated total between USD 3 to 4 billion since 1990.
• Many are refraining from seeking legal licenses to occupy coastal areas amid the flagrant anarchy dominating Lebanon’s shoreline.

Source: Report of the Ministry of Public Works and Transportation

Source: Official Gazette

Source: Report of the Ministry of Public Works and Transportation

Source: Draft law on the increase of coastal fees