UK: Salans News Real Estate And Construction - September, 2009

Last Updated: 8 October 2009
Article by Oleg Batyuk, Myron Rabij and Anzhelika Shtukaturova

Contents

  1. Legal news on real estate and construction
  2. The main new provisions of the regulatory legal acts on construction
  3. The new legal provisions regarding registration of real estate rights

Legal news on real estate and construction

A number of regulatory legal acts were adopted during May-August 2009, providing for new regulations on construction, hotel certification and registration of the right of ownership to real estate.

Specifically, they include the following regulatory legal acts on construction and real property (buildings, structures):

  • Resolution of the Cabinet of Ministers of Ukraine on "Approval of the procedures for submissions for urban planning projects" No. 489 dated 20.05.2009 ("Resolution No. 89");
  • Resolution of the Cabinet of Ministers of Ukraine on "Amendments to the general terms of execution and performance of capital construction contracts" No. 601 dated 17.06.2009 ("Resolution No. 601");
  • Resolution of the Cabinet of Ministers of Ukraine on "Approval of the procedures for execution of compulsory insurance agreements for construction installation works" No. 629 dated 17.06.2009 ("Resolution No. 629");
  • Resolution of the Cabinet of Ministers of Ukraine on "Approval of the procedures for determining categories of hotels and other property designated for the provision of services of temporary accommodation" No. 803 dated 29.07.2009 ("Resolution No. 803"); and
  • Resolution of the Cabinet of Ministers of Ukraine on "Approval of the procedures for sale of property subject to privatization together with publicly owned land plots" No. 689 dated 08.07.2009 ("Resolution No. 689").

New regulatory legal acts and recommendations regarding the methods of registration of rights to real estate include:

  • Resolution of the Cabinet of Ministers of Ukraine on "Issuance of state documents for the right of ownership to a land plot" No. 774 dated 27.05.2009 ("Resolution No. 774");
  • Decree of the Ministry of Justice of Ukraine on "Approval of the recommendations for methods of state registration of the right of ownership to real property which is the subject of court judgments" No. 914/5 dated 26.05.2009 ("Decree No. 914/5");
  • Decree of the State Property Fund, entitled "Standard price set for services and works pertaining to property and land plot appraisal" No. 1170 dated 27.07.2009 («Decree No. 1170»);
  • Decree of the State Committee for Land Resources of Ukraine on "Particular issues regarding execution of the provisions of the law of Ukraine on 'Amendments to particular legal acts of Ukraine regarding documents certifying rights to a land plot and procedures for division and merger of land plots' " No. 326 22.06.2009 ("Decree No. 326"); and
  • Decree of the State Committee for Land Resources of Ukraine on "Approval of the instructions for filling in forms in respect of the state documents for the right of ownership and right of permanent use of a land plot" No. 325 dated 22.06.2009, registered with the Ministry of Justice of Ukraine on 06.08.2009 under No. 735/16751 ("Decree No. 325").

The main new provisions of the regulatory legal acts on construction

1. Resolution No. 489 replaced the resolution of the Cabinet of Ministers of Ukraine on "Procedures for submission of the architectural plans of a project and technical specifications for the engineering aspects of an architectural project and determining the respective fees for their issuance" No. 2328 dated 20.12.1999. Thus, from now on, in order to commence construction, the following documents must be obtained, instead of the plans for an architectural project: (1) town-planning terms and restrictions for the development of a land plot; (2) technical specifications; (3) plans for the project. Moreover, town-planning terms and restrictions for the development of a land plot located within a populated area must be set by the local development regulations. If there are no local development regulations or in the case of an intended development outside the populated area, town-planning terms and restrictions for development of a land plot must be set out by decision of the respective executive authority, based on town-planning rationale and subject to public discussion. Town-planning terms and restrictions for the development of a land plot and technical specifications must be provided to: (1) the owner / user of a land plot; (2) a person approved by a decision on the transfer (provision) of a land plot from public or communal ownership as prescribed by the land legislation; or (3) a person authorized by the owner / user of a land plot. If a public or communal land plot is put up for tender, townplanning terms and restrictions for the development of a land plot are included in the technical passport of the plot sold and must be delivered to the successful party.

2. Resolution No. 601 provides more detailed regulations for designer and technical supervision over the performance of works, risk insurance for accidental demolition of or damage to a construction project, control over the compliance of works and material resources with the established requirements, project documentation and contract agreement.

3. Resolution No. 629 sets out the mechanism for entering into compulsory insurance agreements for construction installation works. In particular, Resolution No. 629 prescribes that an insurance contract must be made by a developer or his contractor for the benefit of a trustee upon his preliminary written agreement with an insurer licensed to provide compulsory insurance for the construction installation works and who is a member of a "Construction Insurance Pool" (hereafter – Insurer), subject to the insurer's written application containing all the required information about the subject matter of the compulsory insurance agreement and all the circumstances of considerable significance for determining the degree of an insurance risk, in the form stipulated by the Insurer. The subject matter of an insurance contract must be the construction installation works, to be insured for the main period of project construction.

4. Resolution No. 803 provides that categories of hotels and other buildings designated for the provision of temporary accommodation services must be determined pursuant to the rules of compulsory certification for temporary accommodation services, as approved by the State Consumer Standard. Hotels shall be classified according to the following categories: "five stars", "four stars", "three stars", "two stars" and "one star". The category for other facilities designated for the provision of temporary accommodation services, including motels, boarding houses, tourist bases, sanatoriums and camp sites, shall be set based on the standard of service in them (first, second, third, fourth and fifth, respectively). However, the resolution does not specify which of the service standards is the best: first or fifth. The compulsory certification shall be made by the certification authorities appointed by the State Consumer Standard for performing certification works in the UkrSEPRO state certification system. Categorization shall be evidenced in the form of a certificate, issued for a maximum period of three years or upon availability of a quality management system in the hotel, for a maximum period of five years. Resolution No. 803 became effective as of August 10 2008, thus no experience of its practical application is available.

5. Resolution No. 689 approved the procedures/process for selling the buildings subject to privatization, together with public land plots. Attention should be paid to the fact that previous legislation determined a building/structure and its land plot as two separate lots. Resolution No. 689, inter alia, stipulates that public property buildings are classified as group А, Д or Ж and integral property complexes of groups В and Г under the classification of the Program of State Certification together with public land plots as prescribed by auction. Stock (participation interests, shares) in the state-owned business entities must be sold pursuant to laws on privatization upon the including by the state privatization authority of public land plots in the charter capital of such business entities. The state privatization authority must act as the arranger of the auction.

The state privatization authorities, taking into account the approved lists of state property subject to privatization, shall prepare and present on their web site the list of auction items and list of business entities with the land plots included in their charter capitals. Thereafter, such lists are forwarded to the respective state authorities for land resources together with an inquiry regarding the necessity to prepare technical documentation for the land plots. The state authority for land resources shall prepare and provide this information to the state privatization authority within a ten-day period. The auction takes place upon approval of the requisite experts' estimates of the real estate and publication of the information regarding the auction. The auctioned items shall be sold at an open meeting of the auction commission formed by the state privatization authority by involving specialists from and representatives of the state authority for land resources, local self governing authority, asset holder, and personnel of the enterprise to be privatized (in case of privatization of its integral property complex). The auction commission sets forth the conditions, including the primary value of the auction item and term of the auction.

In order to participate in the auction, the participants in the auction must pay a registration fee as established by the state privatization authority; the amount of such fee shall not exceed one month's non-taxable standardized minimum income, and a guarantee fee equal to 10 per cent of the primary value of the auction item.

Registration and guarantee fees must be deposited in the accounts of the privatization bodies, opened in the bodies of the State Treasury and in authorized banks.

Applications for participation in the auction submitted by a foreign legal entity, or joint venture founded with participation of a foreign legal entity or individual, shall be reviewed by the state privatization authorities upon agreement with the Cabinet of Ministers of Ukraine. The results of sale of the auctioned item must be executed in the form of a sale purchase agreement to be certified by a notary registered with the state authorities.

The new legal provisions regarding registration of real estate rights

1. Resolution No. 774 prolonged the term for issuing state documents for a land plot form, approved by resolution of the Cabinet of Ministers of Ukraine dated 02.04.2002 No. 449 "Approval of the forms for the state document concerning the right of ownership and the state document concerning the right of permanent use of the land plot" until all the produced forms of such documents as amended have been used. However, state documents concerning the right of ownership to a land plot issued after the entry into force of the Resolution of the Cabinet of Ministers of Ukraine dated 12.11.2008 No. 1019 "Amendments to the resolution of the Cabinet of Ministers of Ukraine dated 02.04.2002 No. 49" by the form, approved by resolution of the Cabinet of Ministers of Ukraine dated 02.04.2002 No. 449, remain valid and effective. This resolution of the Cabinet of Ministers is preconditioned by the following factors: (1) a considerable number of the previous forms remains unused; (2) printing of new forms is time-consuming and costly; (3) prior to the issuance of new forms, the regions refused to issue state documents, causing a great number of complaints against the actions of the bodies of the State Land Cadastre.

2. Decree No. 914/5 establishes that judgments on the recognition of ownership rights to real property, on the establishment of ownership rights to real property and the transfer of ownerless real estate to communal property are constitutive documents, which serve as a basis for state registration of the right of ownership to real property. The term "judgment" refers to a sentence, decision, resolution or decree made (taken) by courts in criminal, civil, economic cases, in cases of administrative jurisdiction and cases regarding administrative violations, and also to a court order rendered in the course of a writ proceeding in civil cases. Moreover, Decree No. 914/5 provides that the resolutions taken by arbitration in cases outside the jurisdiction of the arbitration pursuant to the law, including disputes regarding real estate, and made before the law came into force and yet not executed by March 31, 2009 (in particular, if state registration of the right of ownership to real estate has not been performed), shall not be grounds for state registration of the right of ownership to real estate.

3. Decree No. 1170 approved the price list for appraisal works regarding: real property, integral property complexes, shareholdings and contributions to the charter capitals of companies.

4. Decree No. 326 provided a more detailed interpretation of the provision of the law of Ukraine on "Amendments to particular legal documents of Ukraine regarding documents certifying the ownership rights to a land plot and procedures for the division and merger of land plots" and the resolution of the Cabinet of Ministers of Ukraine regarding procedures for marking transfer of the rights of ownership to a land plot, dated 06.05.2009 No. 439. It sets out a form of application to be submitted by a transferee of the land plot to the land cadastre regarding registration of the rights to the land plot and provides for a detailed registration procedure of the land plot to be performed by the local bodies of the State Land Cadastre. Please note that Decree No. 326 is not registered with the Ministry of Justice of Ukraine and thus it is exclusively of an advisory nature.

5. Decree No. 375 establishes procedures for filling in the forms of the state documents to establish the ownership rights to a land plot and rights of permanent use of a land plot, approved by resolution of the Cabinet of Ministers of Ukraine dated 02.04.2002 No. 449 "Approval of the forms of state document to establish ownership rights and the state document determining the right of permanent use of a land plot" (as amended by the resolution of the Cabinet of Ministers of Ukraine dated 12.11.2008 No. 1019).

The state documents for the right of ownership to a land plot and for the right of permanent use of a land plot must be completed in two counterparts, one is for a land owner or land user, and the other with a mark "archived" in the top left corner of the first page together with the respective land tenure documents must be filed with the main department of the State Land Committee in the city of Kyiv, city of Sevastopol, department of the State Land Committee in the region (city), or the interdistrict, inter-municipal or inter-regional department of the State Land Committee.

The following significant new standards on filling-in the state documents include:

  • The state document must contain: the name, date and number of the documents pursuant to which the right to the land plot is granted; the name of the body issuing this document (resolution of the local selfregulating or executive authority, of the court, sale purchase agreement, gift deed, certificate of inheritance right, decision to contribute a land plot into the charter capital, other civil agreements).
  • The area of a land plot is indicated with a value up to 0, 0001 he.
  • If the right of ownership is acquired subject to a court judgment, sale purchase agreement, lease agreement, gift deed, other civil agreement and in other cases prescribed by the legislation, the state document for the right of ownership to the land plot must be signed by the respective director of the territorial body of the State Land Committee and executive body, if such land plot is outside a populated area. If the land plot is located in a populated area, such state document must be issued by the respective director of the territorial body of the State Land Committee and the local self-regulating body.
  • Correction of spelling or technical errors in the form or state document is not permitted.
  • In case of loss (damage) of the state document, the landowner (land user) must be given a new state document.
  • Forms spoiled when filling-in, damaged documents and documents in a spoiled state must be written off and destroyed by the territorial bodies of the State Land Committee as prescribed by the State Land Committee, pursuant to the legislation on accounting and recording documents of high importance.
  • If a landowner (land user) detects any spelling or technical errors in the issued state document, the landowner (land user) must apply to the territorial bodies of the State Land Committee, requesting that a new state document be issued.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.