The Government has told the EU that local planning regulations based on criteria such as a person's bloodline or ability to speak Irish are "well balanced and proportionate".
It has also argued that such "local needs" restrictions, which exist in 23 county development plans in the Republic, are necessary to maintain the rural fabric of society, achieve balanced regional development and reverse rural population decline.
This robust defence of local planning regulations is contained in a Government dossier sent to the European Commission this month in an attempt to stave off EU legal action. The dossier, which has been seen by The Irish Times, also highlights Ireland's "dynamic property market" as a reason why the restrictions do not breach rules that guarantee the freedom of establishment and the free movement of capital.
About half of the State's local authorities include "local needs" restrictions in their development plans. The move restricts planning permission and sometimes ownership of homes to those who can demonstrate a local need - either that they are working in the area or already live in the area in a home which is not their own.
In June EU internal market commissioner Charlie McCreevy wrote to the Government expressing concerns about conditions for planning based on residency, bloodline, local employment, agricultural activities and linguistic ability. His action followed a complaint by an EU citizen unable to buy land in Wicklow with planning permission attached.
Mr McCreevy said applying conditions such as residency, family members or local employment were not directly linked to the objective of preserving specific areas from development. The practice in Donegal and Galway of granting planning permission only to Irish speakers was "not only disproportionate but also discriminatory", he added.
"Promotion of the language could easily be pursued through less restrictive measures, for example a commitment to learn and use the language. Such a requirement would not exclude nationals from other member states," wrote Mr McCreevy, who invited the State to respond to his concerns before he decides on whether to take legal action.
The Government response, sanctioned by Minister for the Environment John Gormley, says a planning applicant does not have to meet all the "local needs" criteria to be eligible for permission to build a house. As long as at least one of the criteria applies to the applicant, a person can be deemed eligible under "local needs".
It says current regulations allow rural communities to "meet their housing requirements in their areas, while avoiding unsustainable urban sprawl". Even with the restrictions there are still significant opportunities for Irish citizens and other nationalities to settle in a rural or urban setting by buying a property due to "a substantial stock of existing houses" and a "dynamic property market" in Ireland.
The dossier notes restrictions based on residency or former residency of a country are numerous in the planning rules in other EU member states.
Bloodline or family member rules provide a "vital and intrinsic link to the local community", while local employment conditions ensure that people who directly contribute to and participate in the local economy can continue to live in the rural countryside.
The dossier says language experts predict Irish will cease to exist as a community language due to the dominance of English unless there are specific and strong policies to defend it. It also notes that linguistic-related planning policies also exist in Belgium.
The Government says its policy is supported by the Irish Planning Institute, and signs off the letter by saying it trusts its arguments "adequately address the commission's concerns".
Fianna Fáil MEP Seán Ó Neachtáin said he welcomed the Government's vigorous defence of Irish planning laws, including restrictions allowing local authorities to use language as a basis for giving preferential treatment to grant planning permission. The commission will decide whether to take legal action in a matter of months.