After 19 years of discussions, changes and ameliorations, on
March 31st 2020, the supreme legislative body of Ukraine (Verkhovna
Rada) adopted the so-called "land bill" #552-IX. The "Law on Circulation of Agricultural
Lands" was signed by the President of Ukraine, Volodymyr
Zelenski, in May. The official launch of the land market brings
more transparency and clarity to this game-changing issue in
Ukraine.
The land reform, which is great significance, will regulate the
market relationships between both citizens and foreigners. As a
first stage, starting from May 2021, the market will be open only
for Ukrainians. Legal entities with 100% local capital will be able
to acquire agricultural land starting from January 2024. After the
initial success of the internal trade, a referendum on opening the
international market to foreigners will be held.
Starting from July 2021, citizens of Ukraine will be able to
purchase up to 100 ha of land, and up to 10,000 ha as of January
2024. Legal entities local capital will be able to obtain up to
10,000 ha starting from January 2024. However, there are some
internal limitations for both physical and legal entities. Notably,
no one can own more than 35% of one united territorial community
land ("???") or more than 8% of one district
("???????").
The law regulates the terms, quantities and the main conditions
of the agricultural land market in Ukraine. Based on the law,
certain prohibitions (such as land within 50 km of border areas,
temporarily occupied territories, state and municipal-owned lands)
have been put in place. Some additional requirements for foreign
legal entities will also apply. The limitations include the
prohibition of Russian participants, terrorism-related
organisations, foreign states, unknown beneficiaries and entities
under sanctions.
Overall, the adoption of the Law on Circulation of Agricultural Lands is a sign of a new wind for investors. New business opportunities will continue to open and the Ukrainian land – which is one of the most fertile ones - will be ready for your investments.
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.
