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Kharkiv Human Rights Group Social Networking



X. Property right

[1]

1. General overview

Inviolability of the property right and inadmissibility of its unlawful forfeit is one of the manifestations of the constitutional principle of the supremacy of law. Level of the state’s civilization largely depends on the degree of observance of property rights and possibility of their protection, since the phenomenon of property influences on every sphere of social and personal life. For this reason every state endeavours to adjust property relations to the major benefit of all parties, legally securing the importance of the observance and protection of the property right, as it is done in the Constitution and laws of Ukraine, for instance. However it must be admitted that Ukraine encountered systematical and long-term problems residing in the state’s respect to this right, some of which Ukraine tried to resolve in 2014.

First and foremost one may note actions of the country towards the improvement of the system of the state registration of rights to immovable property, in particular towards the property registers and improvement of procedural aspects of the registration of immovable property. However as of today it is yet difficult to speak of the establishment of the effective system as well as of optimal duration of property registration.

Judicial protection of the right to peaceful ownership of property seems to be more complicated issue. By Ukrainian tradition the effective judicial protection or “not protection” of property is more often a tool of political or other kind of pressure rather than means for everyone to protect their right, which outlines a rather big amount of work for the state in the area of a fair trial of cases concerning property.

There are also considerable problems with a direct execution of court rulings, protecting property, since only 30% of the rulings of the Ukrainian courts are executed. It’s especially acute for the rulings which refer to the state as a debtor, of which a great number of cases against Ukraine in The European Court of Human Rights additionally testifies. The problem of non-compliance with court decisions is amplified by the existence of various moratoriums on recovery of property from debtors, which belong to a certain sphere or to state-owned property.

Problems which have remain unsolved this year include problem of forcible withdrawal of land property by the reason of social necessity as well as issues concerning ensuring the right to peaceful ownership of property by the owners of land parcels. Besides, the existence of moratorium on purchase and sale of agricultural land continues to be an essential hazard to ensuring and protection of this right.

2. Guarantees of property right.

2.1. State registration of rights to immovable property

Over two years passed since on January 1, 2013 a new procedure for state registration of rights to immovable property and land came into force, according to which the power to register these rights were transferred from the Bureau of Technical Inventory (BTI) and offices of the State Agency for Land Resources of Ukraine to the State Registration Service of Ukraine and its local divisions. Information on all objects of immovable property was gathered in the State Register of Property Rights.

The changes concerning the system of registration of the rights to immovable property contributed to the upgrade of Ukraine’s rating, in particular according to the World Bank’s Doing Business rating Ukraine moved from 148th place in 2013 to the 97th place in 2014 in the world on this indicator.[2]

Table 1. Procedures for registration of property rights to immovable property in 2014[3]

Country

Place in the world rating in 2014

Number of procedures

Number of registration days

Costs, % of property value

Georgia

1 (1)

1

2

0,05%
(90 USD, 1 working day)

Belarus

3 (3)

2

10

0,03%
(50 USD, 2 working day)

Armenia

5 (4)

3

7

0,10%

Lithuania

6 (5)

3

2

0,80%
(1,6%, 1 working day)

Kyrgyzstan

9 (11)

4

6

0,30%
(145 USD, 1 working day)

Azerbaijan

13 (9)

4

11

0,50%

Estonia

15 (14)

3

18

0,50%

Russian Federation

17 (46)

4

22

0,10%

Kazakhstan

18 (28)

4

23

0,10%

Moldova

19 (16)

5

6

0,90%

Latvia

33 (31)

5

18

2,00%

Ukraine

97 (148)

8

45

1,90%

Europe and Central Asia

6

26

2,80%

The World Bank estimates that the number of registration procedures in Ukraine has decreased from 10 to 8, their average duration — from 69 to 45 days, and registration costs — from 3.7% to 1.9% of the value of immovable property.

However, despite significant changes in specified — not full — quality indicators of immovable property registration, Ukraine managed to exceed the average indicators of Europe and Central Asia region only in the cost of registration procedures. Ukraine remains so far an outsider among post-Soviet countries which do not cease conducting significant reforms in this area.

Concerning the year of 2014, reforming of the entire system was slow and not as stable as it was reported by the Ministry of Justice. For the purpose of another procedure improvement on February 12, 2014 the Cabinet of Ministers of Ukraine changed the requirements for the state registration of rights to immovable property.[4] The main innovation was the alternative by submitting documents for the state registration of rights. In addition to a direct appeal by an applicant, there was introduced a possibility to send notarized documents to the State Registration Service by mail or courier.

Finally the problem of state registration of rights with the issuance of the certificate of title to immovable property instead of lost, damaged or deformed certificates or state certificates of land ownership, issued by the competent authorities before 1 January 2013, was settled. Previously this procedure had not been provided for whatsoever. Houses built in the Soviet Union are provided with the state registration of right to state and communal ownership of property on the objects of immovable property. In addition, an access to registers, which functioned up to 1 January 2013, is opened: in case if there are no data on registration in the State Register of Rights to Immovable Property. Also among innovations one should mention simultaneous registration of property rights and proprietary rights, derived from property right, on the basis of a single application for the state registration of rights, which can be submitted both by owner and legal successor (previously two different applications were submitted).[5]

But at the same time it should be noted that although these innovations might somehow simplify the registration of immovable property, they still won’t solve the most important problem — the duration of registration. If allow sending applications by mail, the issue of queues is removed, but the problem of the velocity of registration activities is not solved. Furthermore, sometimes when a registrar finds himself in an unusual situation, not knowing how to proceed, he denies performing actions without specifying the reasons of what he finds wrong with the documents[6].

Most experts estimate these changes as positive but not as revolutionary, pointing out that greater part of new rules is technical, such that clarify and elaborate on certain processes.

It is also noted that there are other not very positive aspects. According to the established procedure in order to register property rights one could go in many cases to a notary and not to a state registrar. Technically a notary can move the old registration into the new register, in particular for the purposes of attestation by a notary of an agreement with such property. According to the new procedure, a notary may also register property right to the object that was registered before but only if a notary simultaneously registers derivative right, that is implying that the agreement is actually executed. Officially registration of rights executed by a state registrar should be cheaper and faster than by a private notary. If to look at the actual situation, the registrars simply could not cope with the work; there were long queues, rejections, and misunderstanding with the documents, which were to be submitted, and so on. It is impossible to eliminate corruption component either. Notary is little more expensive but more reliable. Now it is being fought against. Perhaps it complies with the spirit of the law, but on the other hand, it will make life harder for the market and will somewhat monopolize the position of the State Registration Service of Ukraine.[7]

In the process of adopting of the new procedure it was also not taken into account that for the registration of property rights to object under construction the new procedure requires the mandatory submission of a construction permit. With that there remains an unsolved situation where property right to such object is registered not by a developer, but by the person who bought it from the developer, but had never received a building permit.

To this day there remains the problem of registration of property rights to main and industrial pipelines (including gas distribution networks), roads, electricity networks, main heating networks, communication networks, railways. One of the reasons for this problem is that the order of the Ministry of Justice says that gas pipelines are immovable property, and therefore have to be registered under the Law of Ukraine “On the State Registration of Propriety Rights to Immovable Property and Their Encumbrances”[8]. Similar problems also arise when considering the status of the types of assets like roads, electricity and heat networks, communication networks, railways.

However, the state registration of rights to pipelines, roads, electricity networks, main heating networks, communication networks, railways is problematic and almost impossible. One reason is that the pipeline facilities are usually situated on the territory of a street, several streets, town, between towns.

In addition, it is often impossible to determine indisputably, whether movable or immovable property is a gas distribution network consisting of various elements in relation of their connection to the ground, particularly if some parts of the compound thing, which are the gas distribution networks, might be referred with significant precautions to immovable, others under any circumstances are movable.

In addition to this problem, there is another, equally painful, concerning various linear objects. The problem is that now other people’s land parcels under such facilities are used without any legal basis. This applies both to those facilities which are connected to the ground on the territory of other people’s land parcels, as well as those that do not have such connection (for instance, power lines that pass over other people’s land parcels, if their towers are situated outside those land parcels).[9]

It should also be noted that the problem of the incompetence of registrars remains. Trite, but illustrative example is when a person who received the State Certificate on Land Ownership, failed to conduct state registration of property rights to this land parcel because the registration service made a mistake when entering this person’s data to the State Centre of the Land Cadastre.[10]

The important question in the context of ensuring the right to peaceful ownership of property is the functioning of the State Register of Rights to Immovable Property. For a long time experts have noted the importance of the open access to this register. Only on October 14, 2014 the Verkhovna Rada of Ukraine has made an important step towards this by adopting as it stands the Law “On Amendments to Certain Legislative Acts of Ukraine Concerning the Definition of Final Beneficiaries of Legal Entities and Public Figures.” The new law establishes not only the duty of disclosure of information about people who have a decisive influence over the management or operation of the company by all legal entities, but also requires the opening of the State Register of Rights to Immovable Property and Their Encumbrances.

Thus, with the law’s entry into force, any person or entity can obtain information on specific immovable property electronically through the State Registration Service’s official website or through written submissions. However, only government representatives can at once obtain information on all registered rights of a certain person (“search by the subject of right”.)[11]

2.2. The guarantees of judicial protection of property rights

Judicial protection of owners’ rights from any undue interference is one of the most important tasks of the state. Analysis of the performance of the economic courts in the last two years shows that in the year of 2013 the trend to reduce the number of appeals to the economic courts with claims for protection of property right was interrupted. Instead, the tendency to reduce the number of full or partial satisfaction of claims of this category’s cases remains.

The dynemics of economic courts hearing cases related to the protection of property right (thous.)

In 2013 economic courts heard 2000 cases related to property right. As a result of their proceedings only 49% of the claims were fully or partially satisfied (in 2012 — 64.6%, in 2011 — 71.8%).

The grounds for filing lawsuits in this category in 2013 were:

— The recognition of property rights (1200), of which 51.3%; were recognized as justified fully or partially;

— Recovery of property from other person’s illegal possession (300), of which 52.2%; were recognized as justified fully or partially;

— Removal of obstacles to using property (300), of which 46.3%; were recognized as justified fully or partially.

It should be noted that the Ukrainian legislation provides a great number of means of property right protection. However, many of them are not clearly regulated, which leads to controversial issues and contradictions in their application, by the judiciary in particular.[12]

Also protection of property rights is complicated by the courts’ violation of reasonable case review duration. An analysis of data provided by the courts shows that the main causes of violation of reasonable case review duration is the default of appearance of the parties and their representatives to the court hearings, and a long duration of the forensic examination. There is also an unfounded satisfaction of petitions submitted by the parties without adequate justification.[13]

Civil litigation. Failure to meet reasonable deadlines for

Region

Number of cases
in the proceedings of local
general courts for the period
more than 1 year

Number of cases
under consideration in appeals
instances for the period of more
than 4 months

AR Crimea

39

40

Vinnytsia region

215

8

Volyn region

15

8

Dnipropetrovsk region

1490

197

Donetsk region

113

0

Zhitomir region

387

31

Zakarpattia region

247

83

Zaporizhzhia region

266

49

Ivano-Frankivsk region

429

15

Kyiv region

172

24

Kirovohrad region

30

28

Luhansk region

562

15

Lviv region

1201

97

Mykolaiv region

134

9

Odessa region

1386

131

Poltava region

45

13

Rivne region

107

3

Sumy region

66

3

Ternopil region

34

2

Kharkiv region

560

77

Kherson region

9

15

Khmelnytsky region

87

13

Cherkasy Region

189

33

Chernivtsi region

12

7

Kyiv

845

188

Sevastopol

148

21

Collectively

8889

1129

3. Failure to comply with property protecting court decisions

Execution of a court decision is an integral part of the right to a fair trial, and the correct application by courts of procedural legislation relating to enforcement of court decisions is crucial in view of compliance in particular with the right to peaceful enjoyment of one’s property.

At the same time, non-enforcement in Ukraine of court decisions that protect property has unfortunately become a national tradition. It is especially true for decisions by means of which the funds are collected from the state budget. The procedure of execution of judicial acts is usually delayed for years.

Compulsory execution of court decisions is carried out by the State Executive Service (SES), a central executive body, activities of which are ruled by the Ministry of Justice. The culture of submission to a court decision is in Ukraine rather low. Even government agencies and their officials appeal after loss of the case an obviously fair decision until the last resort and deviate strongly from its implementation[14]. Needless to say that most decisions on funds recovery, debtor’s obligations to perform certain actions or refrain from their execution are carried out compulsory.

Given these factors, the average annual load on one such state enforcement officer is several thousand proceedings.

In one proceeding a state enforcement officer may produce a number of resolutions, direct payment demand to banks servicing the debtor, detect movable and immovable property, distrain and withdraw it, involve an estimator for its evaluation, transfer it for realization, conduct markdowns.

Salary of a state enforcement officer makes about 2 thousand UAH. Provided that, he may be processing enforcement proceedings for recovery of millionth, and at the Department of compulsory execution of judgements — billionth amounts of funds. Whether they will be recovered depends on the efficiency and conscience of this state enforcement officer.

The law “On Enforcement Proceedings” provides a state enforcement officer executive with discretionary powers, which are the basis for corruption. It suits neither business nor citizens who can not get the recovery, acknowledged to them by the court decision, during the years.

Recovery statistics shows that the work of the executive service agencies is extremely inefficient. Thus, in 2013, in the agencies of the State Executive Service were under proceeding more than 8 million cases for the amount of 440 billion UAH. The average percentage of recovery is only 4% or 20 billion UAH[15].

It should be mentioned that the state as a debtor by the court decision behaves not better than a private debtor. Therefore, the number of complaints to the European Court of Human Rights concerning unsatisfied judgments is steadily growing.

Ukraine holds the third place in the number of applications under consideration of the European Court of Human Rights. As of 31 December 2013 at the European Court were 13, 284 applications filed against Ukraine, representing 13.3% of the total number of applications before the Court. The biggest number of applications against Ukraine, for which in 2013 decisions on the merits were made, deal with the systemic problem of non-fulfilment (prolonged non-enforcement of the national courts’ decisions)[16].

One of the examples of such case is the case “Industrialexport” JSC, in which at the moment of resolution by the European Court of its decision the state Ukraine did not fulfill its obligations to the applicant during 17 years — by the decision of the International Commercial Arbitration Court and 7 years — by the decision of the Kyiv Commercial Court. And the reason of their non-fulfilment the state structures name the lack of budget funds. This is a standard excuse in the process of implementation of court decisions, in which the debtor is the State.[17]

Another example is the case of S. H. Kyrychenko, in which the right to ownership of millions of hryvnia was violated and already for more than 10 years the decision of the Ukrainian court has not been executed. It should be noted here, that even the decision of the European Court of Human Rights in this case did not change the situation concerning the execution of this decision of the national court.[18]

Many cases in the European Court deal with the problem of non-fulfilment of the decisions of the Ukrainian courts regarding social cases related to the fact that the state does not fulfil its obligation to provide legal guarantees for social and economic rights.

To solve this problem, the Verkhovna Rada of Ukraine already on the 5th June, 2012 adopted the Law “On State Guarantees on Court Decisions Enforcement.” Later, on the 19th of September 2013, the Verkhovna Rada by means of the Law No. 583-VII supplemented the Section II “Final and Transitional Provisions” of this Law. But, as human rights defenders noted in the Annual reports “Human Rights in Ukraine”[19], these government actions did not fundamentally solve the problem because they contained numerous flaws and did not consider important aspects of court decisions implementation.

On September 3d, 2014, the Cabinet of Ministers of Ukraine made the next attempt to change the situation for better. Yes, the Resolution approving the Procedure for repayment according to the decisions of the court, the implementation of which is guaranteed by the state, was adopted.

Minister of Justice of Ukraine P. Petrenko stated regarding this Resolution that the Government has taken a principle stand to make payments on all obligations under the court decisions. This refers to 2 million Ukrainians, who had the relevant rights to benefits and have received the relevant court decisions, which were not performed for many years.[20]

According to this Regulation, all citizens who have in hand court decisions, should address the SES bodies to be included to the appropriate register. “After the formation of the registers within the resources available in the state budget, we will pay people money, which they are entitled to receive by law,”- admitted the Minister of Justice of Ukraine.[21]

Despite some positive from this step and solution of some procedural problems, there are substantial doubts concerning the reality of implementation of these promises, so as the sufficient financial resources to be allocated for these purposes are yet not spelled out in the budget. And if this key problem will not be solved, then the court decisions will remain not executed and will for years be in the relevant register.

A significant negative result in respect of the enforcement of the right to peaceful enjoyment of your property is the presence in Ukraine of moratoria on recovery against property. Thus, the state has extended the moratorium on the bankruptcy proceedings of the fuel-and-energy sector companies, which that was introduced already 23.06.2005 for the period only until 31st of December 2006, but has been repeatedly renewed. Application of this moratorium prevents charge of debts of the insolvent debtor in bankruptcy proceedings, and instead, allows the general public on the basis of industry sector (“fuel and energy complex”), legally avoid paying debts on their obligations, paying taxes, distort competitive environment that adversely influenced the execution level of contracts in Ukraine, level of protection of the rights of creditors, impairs the investment attractiveness of the domestic economy and creates enormous corruption risks”[22].

Each time earlier when a decision concerning the extension of the moratorium was taken by the Verkhovna Rada, MPs demanded that the government provided a list of these companies. And the government has never provided such list of the Verkhovna Rada. Therefore, the said moratorium worked in the shadowy and manual mode, so to speak, “for insiders.”

The existence of this and other moratoria set by the legislator — is one of the reasons of the low efficiency of recovery of debts of insolvent debtors. In the light of this, Ukraine has not got the awaited improvement of the indicator figures “Insolvency settlement” in the annual study by the World Bank “Doing Business 2014” (took with this indicator place number 162) and even worsened its position by 5 points (last year there was an increase of 1 point). The deterioration of the rating was due to decrease of the recoverability rate (cents on the dollar) — the amount of compensation to the creditor in 2014 is 8.2 (in 2013 — 8.7).[23]

4. Activities of authorities regarding the limitation of property rights

4.1. Seizure of private property for public use

The problem of buying-out of land plots in private property for public use remains unsolved, and it is related to unclear notions defined in the Law “On alienation of land and other items of immovable property located thereon, which are privately owned for public needs or social necessity” and assessment of the property to be recovered.

Also in 2014 the problem of appropriation of property for military purposes gained special importance. Thus, a large number of companies in Ukraine faced with requirements to provide on demand of military commissariats cars on the basis of the law “On mobilization preparation and mobilization.” This law defines the obligations of the companies regarding the mobilization training and mobilization. In particular, companies are required to provide in the course of mobilization buildings, facilities, transportation and other supplies and logistical means to the Armed Forces of Ukraine and other military formations, Operational-rescue Service of civil protection in accordance with mobilization plans, followed by the compensation of their value in the legally prescribed manner.

But the order of compensation has not been approved. As for the order of execution of military-transport obligation, such procedure exists. Regulations on military-transport obligation were approved long ago by the Resolution of Cabinet of Ministers of Ukraine No. 1921 as of 28.12.2000. The Regulation is valid today and extends to enterprises of all types of property. Moreover, annex 1 to the Regulation defines basic requirements for vehicles intended for transfer to military formations in the period of mobilization and wartime. In what condition they must be returned to their owners, as well as the obligation to return them — is not defined by the Regulation. What documents must be issued for acceptance and transfer of vehicles, who is obliged to sign them — these are now the questions without answers.

The most striking fact is the fact that neither the Law nor the Regulation, nor other normative act does not define the state’s obligation to return the due to mobilization transferred property of private persons. If the state wants to return it, then it will return it. If not — sorry. But they did not forget about the responsibility, to which the article 210-1 of the Code of Ukraine on Administrative Offenses is dedicated.[24]

In fact, this situation shows the attitude of the state to respect of private property right and calls into question the validity of provisions relating to refund of the property seized for public use.

4.2. Allocation of land plots for the intended purpose

The existing administrative procedure for establishing and changing the purpose of land plots does not entitle the owner of a land plot freely use and dispose such plot to meet different needs and implement the guaranteed by the Constitution of Ukraine right to own land. Among the obstacles to the implementation of subjective land rights may be distinguished, first, the designated purpose of the plot, which is indicated in the document of title not in accordance with the categories of land, and according to its functional purpose, which is established by the Classification of kinds of designated purpose of land, legitimacy of which, to put it lightly, is doubtful. [25] Defined in this way designated purpose of the land plot significantly reduces the possibilities of the owner, placing him into the framework of the clearly defined, narrow purpose of use. Thus, for example, obtaining into ownership of a land plot for construction and maintenance of a residential building within the residential and public buildings land creates significant barriers to the owner to use it for commercial purposes within the same category of land. In addition, the procedure of change of the designated purpose defined by the Land Code of Ukraine, suggests a complicated procedure, similar to the procedure for acquiring of the land ownership. In particular, similar to the procedure of obtaining of free land, recognized by the ch. 6–10 of the Art. 118 of the Land Code of Ukraine, the procedure of change the designated purpose involves development and approval of such project, taking the decision on its approval and, on this basis, production of the new document of title for the land plot, which limits the ability of the owner for free and mobile decision-taking concerning the procedure of the use of the land plot. The problem in this case is the mere fact of going through the cumbersome and time-consuming procedure in case of absence of the normative restrictions concerning the use of the land plot for different needs.[26]

4.3. Transfer of land plots to private ownership with violation of the norms
of the Land Code of Ukraine

Analyzing judicial practice, one should pay attention to judicial decisions, by means of which the state acts on the right of private ownership of a land plot is determined to be void due to receiving by the owners of such plots with violation of the norms of the applicable law.[27] Examples can be precedents of acknowledgement of the state acts for the right of ownership on land plots issued on the basis of illegal decisions of city councils (transfer of communal ownership land to private ownership) as invalid.[28] Similar situation occurred when according to the decision of the Kyiv City Council land, owned by territorial community of Kyiv, was given to private ownership. The project of the decision on transfer to the ownership of the land was not prepared by the Central Administration on Land Resources of the Kyiv City Council and was not directed to the Kyiv City Council for consideration, which indicates that the relevant decision was taken with violation of the by the Land Code of Ukraine established procedures. In 2014 the Court of Appeal in Kyiv declared the decision of the Kyiv City Council as illegal and recognized the right of ownership of the disputed land plot to belong to the territorial community Kyiv.[29] Unfortunately, the practice of transferring of land plots to private ownership with violation of the legally established requirements are very common nowadays. Moreover, not always the evidence of such violations is found out by authorized bodies and appealed in a judicial procedure. Sometimes even appealing to court does not guarantee protection of violated rights in the sphere of land legal arrangements, and the parties can obtain legitimate solutions only after addressing a complaint to an appeals or cassation instance.

4.4. Moratorium on sale of farmland

In 2014, the effect the moratorium on sale of agricultural land continued. In addition, in July o 2014 the working group of The State Agency for Land Resources of Ukraine voiced a proposal to ban the sale of agricultural land and determine the minimum lease term of the land at least 10 years. As the Chairman The State Agency for Land Resources of Ukraine admitted, “complete ban of the sale of agricultural land, legislative recognition of roads and legal mechanisms for further development of relationship of agricultural land-use and establishing of the minimum lease term for agricultural land will lay solid foundation for sustainable development of land relations”.[30]

However, it should be noted that the effect of the ban on alienation and change of the purpose of agricultural land limits the rights of land owners, which are guaranteed by the Constitution of Ukraine (Art. 41) and the Land Code of Ukraine (Ch. 1, Art. 90). Moreover, restriction or even loss of access by owners to use their land plots in many cases actually means depriving the owner of the greater part of the benefits that the exercise of the ownership right would bring him. Exactly this might occur, for example, when a person has only a small area of agricultural land area that is economically unviable to use for the intended purpose. The average size of land plot (share) in Ukraine is 4 hectares. At the same time, for example, according to the data of the scientists of the Institute of Agricultural Economics, the optimal size of, for example, farms of grain and grain-beet areas is defined at the level of 300–400 hectares, and if the size of the farm is 55 hectares of animal industry would be unprofitable there. One can argue about the certain size of the economically viable farm, but that this size is bigger than 4 ha is certain.

Similar situation will be in the case when a person because of his elderly age (the majority of owners of land plots (shares) are pensioners) is incapable of handling agricultural land by himself. In such cases, the prohibition to sell a plot of land means that the owner cannot get a normal economic effect from his property — the land plot. We should point out that under the current conditions the lease of the land plot cannot compensate for losses from the inability to sell the land, because rent rates are scanty. For example, according to official data of the State Committee on Land Resources of Ukraine, during the first quarter of 2009 were concluded 4559.3 thousand agreements for lease of a land plot (share), majority of which — 3099.6 thousand (68%) with the amount of lease payments from 1 5% to 3%.

Let’s compare the number 1,5–3,0% with the banks’ interest rates on term deposits of individuals: according to the Agency “Thomson Reuters” (used by the National Bank of Ukraine), for deposits in national currency for one year as of 16.06.2012 they constitute 16.61 % (of course, for the time the moratorium there were twice as high rates). The main reason for the meager rates for the lease of agricultural land is precisely the moratorium on alienation of agricultural land. Thus, the establishing of the moratorium resulted in causing to owners of agricultural land considerable material damage, which, in principle, is possible to calculate and prove. But, the most important thing is still that the moratorium dilutes the very essence of ownership right, allowing not alone the disposal of, but generally getting a normal economic effect from a land plot (land part (share)).[31]

Despite the fact that the moratorium was introduced with the aim of consolidation of agricultural lands in the hands of their owners and thus guarantee the use of this category of land only for the intended purpose, but de facto the moratorium contributed to the prosperity of various schemes of its bypass, shadowing of land market. It should be noted that in 80% of the cases the participants of the farmland market bypass the moratorium by means of entirely legal methods that can be traced from the analysis of the land laws. In particular, today there exist such ways of alienation of agricultural land as inheritance, exchange, withdrawal for public use, land plot lease agreement, power of attorney, perpetual lease agreement, mortgage, sale of a land plot in parts.[32]

Consequently, for today the effect of the moratorium on alienation of agricultural land is virtually meaningless, since such prohibition usually only harms the land and land shares owners and also holds back the development of the agricultural sector in general.[33]

5. Recommendations

1. Create a transparent and efficient system of state registration of immovable property rights.

2. Improve the protection of rights of landowners, create mechanisms for combating forced seizure of these lands, adopt acts of legislation for regulation of the fundamental aspects of land market.

3. Ensure existence of effective judicial protection of landowners rights and, in particular, implement measures to solve the problem of non-fulfilment of the national courts decisions concerning property protection, including improvement of judicial control over the execution of court decisions, as well as stop the moratoria regarding the forced sale of state enterprises assets. Moreover, to ensure the quickest possible implementation of the regulations of the Law of Ukraine “On State Guarantees on Court Decisions Enforcement” and allocation of sufficient financial resources for its implementation.

4. Improve the system of monitoring of compliance with the law during the procedure of privatization of land plots and foster the transparency of such procedures.

5. Gradually dismiss the moratorium on alienation and change of purposive appointment of agricultural plots of land. Promote the adoption of the Law “On the Land Market.”

6. Improve the mechanism for change of the purpose of land plots and establish clear criteria for definition of possibilities or restrictions of use of a land plot.

7. Promote transparency and simplification of procedures for housing construction, and ensure the rights of investors in this sphere.

8. Regulate the problem of land and houses appropriation according to social necessity in strict accordance with the Constitution and international commitments assumed by Ukraine.

9. Take steps to prevent violations of property rights on the part of the Internal Affairs Agencies.

10. Improve the procedure of compensation in respect of property provided by the Armed Forces of Ukraine during mobilization.

[1] Prepared by M. Shcherbatyuk (UHHRU).

[2]  http://www.doingbusiness.org/data/exploreeconomies/ukraine/registering-property

[3] How not to lose property right behind registration procedures:

 http://pravovakrayina.org.ua//partner_news/-----/

[4] Resolution No. 868 “On approval of the Procedure for the State Registration of Rights to Immovable Property and their Encumbrances and the Procedure for Obtaining Extracts from the State Register of Property Rights on Immovable Property”.

[5] To register immovable property as of the new year will be easier but longer — legal expert

 http://www.radiosvoboda.org/content/article/25218520.html

[6] A new procedure for state registration of rights to immovable property: pros and cons:

 http://ua.racurs.ua/429-novyy-poryadok-derjreiestraciyi-prav-na-neruhome-mayno-plusy-i-minusy

[7] A new procedure for state registration of rights to immovable property: pros and cons:

 http://ua.racurs.ua/429-novyy-poryadok-derjreiestraciyi-prav-na-neruhome-mayno-plusy-i-minusy

[8] Order of the Ministry of Justice of Ukraine “On Approval of Methodological Recommendations of Definition of Immovable Property Located on Land Parcels, the Title to Which is Subject to State Registration.” on April 14, 2009 No. 660/5.

[9] Opinion on the Draft Law of Ukraine “On Amendments to Article 1 of the Law of Ukraine “On the State Registration of Property Rights to Immovable Property and Their Restrictions” (Reg. No. 3895 as of 16.01.2014) http://www.commerciallaw.com.ua/uk/lawvys/lawinua/322-vysnovok-shchodo-proektu-zakonu-ukrajiny-lpro-vnesennja-zmin-do-statti-1-zakonu-ukrajiny-qpro-derzhavnu-rejestraciju-rechovyh-prav-na-neruhome-majno-ta-jih-obmezhenq-rejestr-3895-vid-16012014r

[10] Decision of Chortkiv District Court of Ternopil region as of June 3, 2014 // Single State Register of Court Judgments http://reyestr.court.gov.ua/Review/39049203

[11] People’s deputies opened the State Register of Immovable Property http://www.medialaw.kiev.ua/news/media/2760/

[12] Judicial protection of property rights in economic relationshttp://zib.com.ua/ua/99686-yak_zdiysnyuetsya_sudoviy_zahist_prava_vlasnosti_u_sferi_eko.html

[13] When a year is not enough http://zib.com.ua/ua/print/71394-priznachennya_ekspertizi_ne_mozhe_stavati_privodom_dlya_proc.html

[14] Sworn law enforcement officers for implementation of judgments:

 http://www.epravda.com.ua/columns/2014/06/16/465344/view_print/

[15] Ibid.

[16] Ukraine holds the third place in the number of applications to the European Court of Human Rights:

 http://dt.ua/UKRAINE/ukrayina-posidaye-tretye-misce-za-kilkistyu-zayav-do-yespl-136815_.html

[17] Recovery through Strasbourg http://zib.com.ua/ua/98916-yak_borotisya_z_nevikonannyam_sudovih_rishen_v_ukraini.html

[18] Case of S. H. Kyrychenko v. Ukraine http://www.ipu.ho.ua/

[19] Annual reports “Human Rights in Ukraine”http://helsinki.org.ua/index.php?r=1.4.1.10

[20] Normalized non-fulfilment http://zib.com.ua/ua/99261-pislya_zvirki_sudovih_rishen_uryad_rozrahuetsya_z_pilgovikam.html

[21] Normalized non-fulfilment http://zib.com.ua/ua/99261-pislya_zvirki_sudovih_rishen_uryad_rozrahuetsya_z_pilgovikam.html

[22] UBA supports rejection of moratorium on initiation of bankruptcy cases of the fuel-and-energy sector companies http://www.uba.ua/ukr/news/2972/

[23] UBA supports rejection of moratorium on initiation of bankruptcy cases of the fuel-and-energy sector companies http://www.uba.ua/ukr/news/2972/

[24] Mobilization: to give or not to give? On provision (failure to provide) of cars on demand of a military commissariat http://law-center.com.ua/ua/novyny/comments-ua/auto-mobilization-ua

[25] On approval of the Classification of kinds of designated purpose of land: Decree of the State Committee on Land Resources as of July, 23, 2010 No. 548 // Official Journal of Ukraine. — 2010. — No. 85 (15.11.2010). — p. 3006.

[26] Kostiashkin . Legal support of social function during the allocation of land for the intended purpose

[27] See “Forgery of the decision of the session on illegal transfer of land to private ownership” #.VEUb-fmsWSo “In the Carpathian National Nature Park was illegally privatized 1 hectare of land”

http://galka.if.ua/u-karpatskomu-natsionalnomu-prirodnomu-parku-nezakonno-privatizuvali-1-gektar-zemli/

[28] Decision of the Starosambirskyi district court of Lviv region as of July 29, 2014 //

 http://reyestr.court.gov.ua/Review/40209797

[29] Decision of the Kyiv Court of Appeal as of February 26, 2014 //

 http://www.reyestr.court.gov.ua/Review/37370933

[30] The State Agency for Land Resources of Ukraine proposes to ban the sale of farmland forever //

 http://www.5.ua/ukrajina/ekonomika/item/388660-derzhzemahentstvo-proponuie-nazavzhdy-zaboro nyty-prodazh-zemel-silskohospodarskoho-pryznachennia

[31] Moratorium — no! http://www.amm.org.ua/moratoriyuni

[32] Seven ways to buy land legally http://www.interlegal.com.ua/corporate/?p=1204

[33] Moratorium — no! http://www.amm.org.ua/moratoriyuni