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1.1 Legal Protection
1.2 Registries
1.3 Formal Ownership
In-Country Assessment Information

1. Property Rights

Goal – Property rights that are legally protected, secure, recorded in a single, accurate, widely accessible electronic registry and that lead to high levels of formal ownership for all citizens

 

 

1.1 Legal Protection – Weak

Core Question: Does an effective and sufficient legal framework exist to protect property rights for all citizens?

Guatemala does not have a clear integrated agrarian policy or land law. In 1973, Guatemala made a Civil Code, which provides only general principles on possession, use, transfer, and ownership rights over real property.

Legal Framework (Weak)

1.1.1   Are property rights clearly defined and protected by law? 

Ranked 135 out of 148; Score 3.83 out of 7; Trend ¯

The judiciary is troubled by corruption, and intimidation of judges, prosecutors, and witnesses. The law is very unstable.

Security of Tenure (Strong)

1.1.2   Can citizens challenge the legality of government takings?

Ranked 73 out of 148; Score 3.46 out of 7; Trend ↑

Source: Global Competitiveness Report 2011-2012, World Economic Forum
http://www.weforum.org/issues/global-competitiveness

Bundle of Rights (Weak)

1.1.3   Survey Question

SQ1    What is the bundle of rights (group of rights such as occupancy, use and the right to sell or lease) associated with both residential and commercial property ownership?

The bundle of rights associated with residential and commercial property ownership are weak because the government places serious restrictions on ownership and the Civil Code does not explain in detail what rights one has.

“Guatemala has the most inequitable and concentrated distribution of land ownership in Central America. Historical and pervasive inequality in land distribution was a fundamental contributor to the country’s 36 year civil war and continues to be a primary cause of rural poverty. As of 2007, 2.6 million people -or 40% of the urban population lived in slums. In Guatemala City, slum and non-slum households share neighborhoods on the urban periphery, the dilapidated city center, and in “slum islands” that are located amidst more affluent, fully serviced areas. Also, Guatemala has not yet adopted procedures for registration of communal land.”

Source: Property Rights and Resource Governance
http://usaidlandtenure.net/sites/default/files/country-profiles/full-reports/USAID_Land_Tenure_Guatemala_Profile_0.pdf

 

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1.2 Registries – Strong 

Core Question: Does a reliable property registry exist including cadastral, title and mortgage lien information?

Guatemala has begun to establish their Registration for Cadastral, and they have specified their land uses and zoning in Guatemala City, along with GPS and beginning phases of GIS


1.2.1  Cadastral Information (Strong)

Survey Questions

SQ 2:   Is cadastral information (information about the dimensions and location of land parcels) accessible to the public?

Yes

SQ 3   Is zoning/permitted use information included are use regulations respected and enforced?

Yes, although each municipality manages its own territory, and there are often incompatibilities in land use and service between neighboring areas. The only city that has adequate planning and zoning is the Guatemala City Municipality, but it has no jurisdiction beyond its territory. The rest of the municipalities in Guatemala are governed by urban regulations on the idea of six instruments that dates back four decades.

SQ 4   Are Geographic Information Systems (GIS) including Global Positioning Satellite (GPS) information used to create and update the registry?

Yes, but GIS is barely used with evidence of only one company providing GIS data for Guatemala. This company has only surveyed Guatemala City.

Source:  Registration of Information Cadastral (RIC) – http://www.ric.gob.gt/

Source:  Zoning Report – http://www.ucl.ac.uk/dpu-projects/Global_Report/pdfs/Guatemala.pdf
Source:  GIS – http://goleaddog.com/gis-map/latin-america/guatemala/

1.2.2  Title Registry ( Very Strong)

Ranked 23 out of 189; Trend ↓ 

Procedures, time and costs are extremely low but many properties lack official ownership certificates and in some cases, issues of double title exist. The first party to have registered the property typically prevails as owner. Since there is poor information available at the Real Property Registry, it is difficult to determine who held the first title.

1.2.2.1 What is the number of procedures required to register the transfer of a property from one owner to another?

4

1.2.2.2 What is the duration of time in calendar days that it would take to complete the transfer?

23

1.2.2.3  What is the total cost of the transfer including all fees, taxes, etc. expressed as a percentage of the value of the property?

0.8%

Source – Doing Business 2014 – Registering Property, World Bank – http://www.doingbusiness.org/data/exploreeconomies/guatemala

1.2.3  Mortgage Registry (Weak)

The mortgage market is still relatively new in Guatemala. Mainly all information is still on paper and not available electronically. Guatemala is trying to improve on their information systems so that data can eventually be stored online.

Survey Questions

SQ 5   The mandatory use of notaries or similar officials slows down and adds cost to the process. Does a notary need to be involved in the registration process?

Yes

SQ 6   Is information in the registry available electronically?

Yes, available from the local   property administration, but mainly written and not electronically

SQ 7   Title insurance is indemnity insurance against financial loss from defects in title and from the invalidity or unenforceability of mortgage liens. Is title insurance available to lenders?

Research has indicated only international title insurance products such as “Stewart Title.” Locally, it is difficult for a lender to get title insurance for their property.

Source – Information on International Title Insurance Products
http://files.ali-cle.org/thumbs/datastorage/skoob/articles/BKAC0903_Tab07-Gosdin_thumb.pdf

 

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1.3 Formal Ownership – Weak

Core Question: Do citizens understand and trust property rights institutions and avoid the informal sector?

Guatemala recently emerged from a 36 year civil war in 1996 that resulted in many land distortions. As a result land conflicts are a major issue. Also, ineffective management of land sales by the government exclude low income and indigenous people from access because prices are too high.

Survey Questions

1.3.1 Land (Weak)

SQ 8   What is the status of land ownership?  

“Guatemala has a history of poverty, distorted land distribution patterns and severe income inequality. There was a civil war for 36 years and the Peace Accords attempted to address land issues, including access for poor, legal reform, and land administration. However, political will for reform has been limited, and Guatemala continues to have the most inequitable and concentrated distribution of land ownership in Central America. Land conflicts are a major issue in Guatemala and people have noted that the country’s economic development and competitiveness will be stunted until land conflicts are addressed. Also, indigenous and peasant populations face systemic exclusion from access to land”

Source:http://usaidlandtenure.net/sites/default/files/country-profiles/full-reports/USAID_Land_Tenure_Guatemala_Profile_0.pdf

1.3.2 Home Ownership (Strong)

SQ 9   What is the percentage of formal home ownership?

59.2% in urban areas at the end of 2004 (only available information)

Source: U.N. Habitat Urban Indicators Website, http://www.devinfo.info/urbaninfo/DIWizard/DIWizardHome.aspx

1.3.3  Informal Sector (Very Weak)

What is the percentage of services firms that report competing with unregistered or informal firms?

69.8%

Source: Enterprise Surveys Website http://www.enterprisesurveys.org/

 

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