Source: ABCnews
On Wednesday, November 23, the Cabinet of Ministers of Ukraine abolished 367 regulatory acts, which, according to the Prime Minister Volodymyr Hroysman, slow down the process of deregulation and improvement of the investment environment. It is expected that this decision will help Ukraine to increase its position in the Doing Business ranking by a few dozen points and, therefore, will attract new investors to the country. In addition to the abolition of acts, the Cabinet of Ministers approved provisions, which allow to automate the calculation of a normative monetary value of land plots, and amended a Standard land lease agreement. The expert of the Better Regulation Delivery Office Oleh Pylat told the ABCnews about how the Government’s decision will affect the land market in Ukraine.
Changing the calculation of a normative monetary value of land plots and simplifying this procedure will lead to several positive changes. The first one – due to the adopted resolution, there is a way for the full automation of the calculation of the monetary value. This means that it won’t be possible to underprice a land plot in a “manual” mode. When records on the land value are receiving, a corruption risk is excluded and those who took advantage of these schemes won’t be able to use them. In its turn, this will lead to increased revenues to the local budgets and the entrepreneurs won’t have competitive advantages based on corruption mechanisms.
Second, the process of obtaining data on the land evaluation will be accelerated. While now it is needed to calculate the value of land plots manually and three working days are given for this procedure, as a result of the automation, it will be possible to obtain the calculation of the monetary value the same day it is requested. And if a full electronic service is implemented later, an applicant can receive the necessary data in a few minutes on a personal computer.
The third positive consequence of changes should be the publicity of data on the normative monetary value. According to the law, the information on the normative monetary value of land should be public. To the extent allowing to see an average monetary value of one square meter of land in any locality or area of Ukraine.
It is natural that the above possibilities do not appear all at once. There is a necessity in a number of software and technological developments, and we should collect and organize the necessary data sets. We have a lot of work ahead, but it is now possible and should be implemented.
Another positive change relates to the simplification of the Standard land lease agreement. Due to making amendments to the law of Ukraine “On Land Lease” (it was amended in February of 2015 – Ed.), the provisions of the Standard land lease agreement don’t meet it any more. Many citizens filed agreements for registration of land lease rights under the law, but still received a refusal and had to change them again according to the requirements of the Standard land lease agreement. And if we are talking about one or two lease contracts in construction, it wouldn’t be so difficult to change them. But if we are talking about 150-200 contracts on agricultural lands, the process is much more complicated because of the large volume of documents.
Moreover, when simplified land lease agreements were concluded, there were the cases when one party had a reason to terminate it prematurely. And if it came to disputes, one of the parties often used an argument on the non-compliance of the concluded contract with the Standard agreement to justify its claim. In other words, this conflict has become a formal reason to start the litigation.
In general, due to amendments to the Standard agreement, there will be less problems with the registration of land lease rights and less grounds for starting lawsuits and the preparation of land lease agreements will be simplified significantly. This will reduce a number of refusals in the state registration of land lease rights – now there are about 20 thousand refusals. Per year. In addition, it won’t be needed to add necessary supplements to the contracts in 4-5 copies, duplicate the provisions of the law in the text of agreement and prepare a third copy of the agreement.