The call comes in a strongly worded draft report to the European Parliament's Petitions Committee, and is the third report in three years to severely criticise Spain's notorious land grab laws which have seen thousands of property owners threatened with eviction in Valencia.
Written by Danish MEP Margrete Auken, the draft will now be debated by the Petitions Committee, where it could change significantly, before going to a vote in the EP in the Spring of 2009.
It calls on the Spanish authorities to set up procedures to compensate victims, some of whom have lost their properties and other who cannot sell.
It also threatens to cut off future funding, pointing out that the parliament can stop grants 'when necessary to persuade a member state to stop serious infringements of the rules and principles of EU legislation.'
In a further threat to Spain's access to EU money, the draft also points out that the European Commission can demand the return of funds if they have been used to finance projects that go against EU rules.
It calls on Spain's national and regional governments to carefully review all the legislation concerning property rights to put an end to the abuse and says it has found that a lack of clarity, precision, and legal security in Spain's existing urban planning legislation is behind most urban planning abuses in Spain.
There are also concerns that Spain's judicial system is incapable of dealing with the problem.
