Why Ukraine's land market is fundamentally unequal?

Author : Olena Holubeva

Source : 112 Ukraine

The authorities were in a hurry to adopt the most important reform and turned a blind eye to the most important nuances and consequences since they acted in favor of the IMF
21:35, 1 April 2020

land market
Open source

In terms of the most severe restrictions due to the coronavirus in Ukraine, at an extraordinary meeting at night, the Verkhovna Rada adopted a bill that opened the agricultural land market in Ukraine. Over the past six months, this document has repeatedly become the cause of heated battles, skirmishes and even skirmishes in the Rada. Because of him, they blocked the rostrum of the parliament, blocked roads in the regions, and held thousands of protest rallies. About 4,000 amendments were submitted for voting in the second reading.

The bill on opening agricultural land market No. 2178-10 was adopted at an extraordinary meeting of the Parliament on the night of Monday to Tuesday. It was adopted in the second reading and in general, this document was the reason for such heated battles and discussions.

Related: Ukraine’s parliament registers nine draft regulations blocking signing of land market law

MPs voted for the decision according to which from July 1, 2021, citizens of Ukraine (up to 100 hectares for one owner) were allowed to acquire ownership of agricultural land, and from 2024 - to legal entities that were created and registered in accordance with Ukrainian legislation, by participants (shareholders, members) of which are only citizens of Ukraine or the state, or territorial communities.

Ownership of land for agricultural land can also be acquired by banks (in the order of withdrawal as a pledge). In this case, banks must sell the land within two years after receiving them in the property.

Foreigners, stateless persons, and foreign legal entities are prohibited from becoming owners of agricultural land in Ukraine unless otherwise decided by a referendum. So far, there is not even a referendum law. Therefore, the big question is when a referendum can be held and whether it will be held at all.

Related: Ukraine’s parliament registers two draft regulations blocking signing of land market law

The authorities were in a hurry to adopt the most important reform and turned a blind eye to the most important nuances and consequences, since they acted in favor of the IMF. On the eve of the vote for the land bill, President Zelensky personally arrived in Rada. Earlier, he called on the MPs to vote for the land market, openly saying that this is one of the conditions of the Fund for the allocation of financial assistance to Ukraine. "It is very important for us that the signing of the memorandum with the International Monetary Fund really takes place, and you are well aware that the two main conditions are the land law and banking law," he said at an extraordinary parliamentary meeting on March 30.

President of the Ukrainian Agrarian Confederation Leonid Kozachenko assumes that: "The law was finally adopted was largely due to the fact that a significant number of amendments was adopted. These amendments were elaborated by thee professional public associations, in particular, they have made fundamental changes regarding the allotment size per owner, the priority of the purchase right."

According to experts, the land reform would not allow the owners of land shares (about 7 million inhabitants) who want to sell their shares to get a fair price for it. Accordingly, rural budgets will not receive tax revenues, which under fair conditions could be much higher. "The model that was introduced yesterday by the bill creates the market in a fairly truncated form," Oleh Nivevsky, associate professor at the Kyiv School of Economics, concluded.

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It is difficult to ignore the malicious intent of those who have launched the reform in its current imperfect form. Its creators would become the beneficiaries by buying their lands from impoverished people.

Although it’s not easy to do this. First they have to break the resistance. In particular, the Parliament has already registered two draft resolutions on the abolition of voting for the "land law." One of them was submitted by MP from far-right Svoboda party Oksana Savchuk and by independent MP Anton Polyakov, who had previously been a member of the Servant of the People faction. Prior to the consideration of these decisions in the parliament hall, a voted law cannot be signed by the head of the Verkhovna Rada and be passed on to the president for signature.

They also promise to appeal the land law to the Constitutional Court. The head of the political council of the Opposition Platform - For Life, Viktor Medvedchuk, has already announced his intention to appeal to Constitutional Court. A similar statement was made by leader of the Fatherland faction Yulia Tymoshenko. Therefore, the issue of land reform is not yet closed.

Related: MPs considered 2897 out of 4018 amendments to draft law on land market in Ukraine

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