Opening of the land market is one of the highly debated topics, which caused a significant public interest. What exactly does land reform provide, how will it affect landowners and tenants, and most importantly, how to prepare to legislative innovations? Below we analyze each of the outlined issues in detail.
Lifting the moratorium on land sales
After it was confirmed in Strasbourg, the prohibition of agricultural land plots sales was a violation of human right to dispose of his/her property, the need of land reform in Ukraine gained even more tension.
Following a 19-year moratorium, Ukrainian Parliament has finally adopted a law on terms and conditions of agricultural land circulation, which enters into force on July 1, 2021.
Thus, starting from this summer, citizens of Ukraine are able to purchase agricultural land plots, but not more than 100 hectares per person.
The second stage of the land market establishment should start on January 1, 2024. Apart from individuals, title to agricultural land will also be possible to acquire by: legal entities established and registered under the laws of Ukraine, the participants of which are citizens of Ukraine; the state; joint territorial communities.
The total area of land plots owned by a citizen of Ukraine or a legal entity shall not exceed 10 thousand hectares.
In turn, the readiness of Ukrainian society to provide access to the land market to foreign citizens will be determined through a referendum.
There are developments in this topic as well: the Law of Ukraine “On Democracy through an All-Ukrainian Referendum” was adopted on 26 January 2021, which stipulated the detailed mechanism of a general referendum.
What else is provided?
The land reform is not just about determining the date and range of entities that will be able to enter into transactions on the agricultural land sales.
Shedding light on the shadow land market, which existed throughout the period when the moratorium was in force, is an urgent and complex task, requiring a fully-fledged and comprehensive solution.
The “package” of reforms includes more than 10 laws and draft laws, as well as almost 5 times more subsidiary laws to be adopted.
The key tasks at the stage of launching the market include, in particular:
- transfer of agricultural lands from state to communal ownership of territorial communities;
- transition of land management powers to the local level;
- optimization of the State Service of Ukraine for Geodesy, Cartography and Cadastre;
- inventory of lands, their digitalization, entering information about them into the State Land Cadastre;
- simplification of land registration procedures;
- ensuring public disclosure of information about land and resources;
- development of funding programs to support small and medium farmers;
- counteraction to illegal takeover, etc.
What steps have already been made?
The Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine Related to Illegal Takeover Combating” (No. 340-IX) has been in force for a year already.
Thus, provisions of this Law establish the possibility of the land plot owner to demand notarization of the following agreements: on establishing land easement, lease, emphyteusis (on granting the right to use a land plot for agricultural purposes), superficies (for construction).
Such notarization requirement is a burden of property rights and is subject to state registration.
The specified requirement may also be established by a participant of a company for conducting a transaction, the subject of which is the share of such participant in the authorized (shared) capital of the company, as well as for certifying the authenticity of his/her signature when making decisions on company’s activities. Information on the establishment of such a requirement shall be entered into the Unified State Register of Legal Entities, Sole Proprietors and Public Organizations.
Such safeguard significantly complicates the illegal takeover of land and corporate rights of agricultural enterprises, in particular, through forgery and double registration of agreements.
Innovations also include the option of parties to certain agreements to include a condition on the automatic renewal thereof for the same period without taking any other actions or entering into supplementary agreements. In this case, after the agreement expires, state registration of property rights shall be extended for the same period.
If a party wishes to refuse to renew the agreement, it must submit an application for exclusion of information on the renewal of the agreement from the State Register of Property Rights to Immovable Property at least on one month prior to the expiration date.
This should significantly reduce the number of litigations related to renewal of such agreements.
Registration takeover is prevented by exchanging information between the State Register of Rights and the State Land Cadastre; recording the price (value) of land plots and property rights thereto; digitalization and entry into the register of rights of information on paper; introduction of additional identification for the registrars to carry out actions in the register of property rights.
According to reports from the Office of Illegal Takeover Combating, the creation of a transparent land monitoring system and data exchange has already shown positive results.
How to prepare for the opening of land market?
Despite the measures taken by the legislator, the free market can lead to an increased number of takeover attacks.
In order to independently prepare and protect a land plot from potential unlawful acts, the following plan of action might be useful:
1) check the registration of a land plot in the State Land Cadastre by entering the cadastral number into the search bar on the Public cadastral map – https://map.land.gov.ua/?cc=3461340.1719504707,6177585.367221659&z=6.5&l=kadastr&bl=ortho10k_all;
2) if no land cadastral number has been assigned, contact the entity, which developed the land management documentation, and ask to prepare the technical documentation for establishment (restoration) of boundaries of the land plot on site (on the ground).
It is impossible to conclude any civil law transactions without correct information on land plots in the State Land Cadastre.
It should be noted that all owners of undistributed (unclaimed) land plots or their heirs must register the title to their land plots (units) by January 1, 2025.
If this requirement is not met, the owners of the plots will be deemed to have refused to obtain the land and it will automatically become the communal property of the territorial community.
3) make sure that your rights to land are duly registered, check the relevant information in the State Register of Property Rights to Immovable Property;
4) establish the requirement for notarization of agreements;
5) tenants should make sure that rent is set at the market prices and is not underpriced, which may impose certain risks;
6) use the online service of the Ministry of Justice of Ukraine — SMS-Lighthouse https://online.minjust.gov.ua/sms/. This will allow you to receive notifications about changes in the status of any immovable property in the State Register of Rights;
7) Sign up in the State Agrarian Register. After registration, data on your immovable property will be included therein from the State Land Cadastre, State Register of Rights, Unified Register of Legal Entities, Individual Entrepreneurs and Public Organizations, Unified State Register of Animals.
Only thorough preparation and conscientious treatment of own resources and property rights will help feel more confident under the turbulent conditions during the launch of the land market in Ukraine.
 Judgment of the European Court of Human Rights of May 22, 2018 in the case of Zelenchuk and Tsytsyura v. Ukraine (Applications No. 846/16 and No. 1075/16)
 Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine Concerning the Terms and Conditions of Agricultural Land Circulation”