On March 31, Ukraine’s Verkhovna Rada adopted a law legalizing the trade of agricultural land, ending a 20-year moratorium. The law will come into effect on July 1, 2021.
41,5 million ha of land was covered by the moratorium
The law is one of the requirements for Ukraine to
receive aid from the International Monetary Fund, without which Ukraine will face
significant difficulties in managing the economic crisis resulting from the COVID-19
epidemic.
259 lawmakers supported the adoption of the
legislation with 226 votes required to pass.
There were several changes introduced to the initial
draft read in November 2019. Main elements now include:
Becomes law with effect on July 1, 2021
For the first two years only individual citizens of Ukraine wiil be able to buy land
The sale of land to foreigners and companies not registered in Ukraine will only be legalized after a referendum
For the first two years the total area owned by one unit cannot exceed 100 ha and since Jauary 1 2024 – 10 000ha
Legal entities, owned or with shareholders being citizens of other countries will not be permitted to own land.
Foreigners will not be allowed to acquire land within 50 kilometers of the borders, irrespective of the referendum results
corporate entities registered in Ukraine owned by Russian citizens,
companies registered in tax havens, companies based in FATF listed third
countries which fail to take effective measures against money laundering, and
companies whose owners cannot be identified will remain unable to purchase
land, irrespective of the referendum results
banks will have the right to acquire land ownership rights only if they
receive it as a pledge for an unpaid loan and will be obliged to sell it within
two years
the pre-emption right will be vested in those leaseholders who leased
the land in 2010 or earlier; they will be offered the opportunity to buy the
land and successively repay it for ten years at a price determined by a
regulated valuation.
259 lawmakers supported the adoption of the legislation with 226 votes required to pass.
The Government would like to hold a referendum
regarding the purchase of agricultural land by foreign investors at the end of
2020.
