Draft Law of Ukraine

"On Land Market"

The draft is an alternative to draft law N 2600 introduced by the Cabinet of Ministers of Ukraine.

According to the draft, land market is a system of economic and legal relations arising in the process of land plots circulation.

Objects of land market are:

• land plots in state and communal ownership, unless they have been included into lands prohibited from privatization;
• land plots in private ownership, except for cases when alienation of such land plots is prohibited.

Subjects of land market are:

• the state in the person of bodies of executive power;
• territorial communities of villages, settlements and cities in the person of respective bodies of local self-government;
• legal entities;
• Ukrainian citizens;
• foreign citizens;
• stateless persons;
• foreign states.

Subjects of land market infrastructure are:

• legal entities that have a license for holding land tenders;
• land (mortgage) banks and other financial institutions;
• consulting and real estate companies;
• legal entities and natural person that have a license for performing pecuniary land evaluation.

Land plots may be alienated through:

• land tenders;
• agreements for purchase and sale, exchange, gift;
• their transfer to the statutory fund of a legal entity;
• buy-out.

Agricultural land plots shall not be in private ownership of:

• foreign citizens;
• stateless persons;
• foreign legal entities.

Until January 1, 2010, citizens and legal entities may acquire into ownership agricultural land plots with a total square up to 100 hectares. It is prohibited to have private ownership for an agricultural land plot, with its square exceeding 10% of agricultural lands located within one administrative region.

Land tenders may take place in the following forms:

• land auction (land is sold to the potential buyer offering the highest price);
• land competition (land is sold to the potential buyer offering the best combination of purchase price and investment plan according to criteria announced before the beginning of land competition).

Also the draft determines the procedure for concluding and fulfilling agreements for purchase and sale of land plots.

The draft aims at ensuring stable development and operation of land market for the purpose of implementing rights and establishing liabilities of natural persons and legal entities, territorial communities and the state with respect to alienation of land plots in their ownership and obtaining land plots into ownership.