The land market in Ukraine may open to citizens of the European Union

At the third stage, the Ukrainian land reform should open the land market for buyers from the European Union. This stage will be the completion of the land reform with the harmonization of the land legislation of Ukraine with the relevant legal norms of the EU.

Currently, Ukraine is seeking to become a member of the European Union, and negotiations between Ukraine and the EU on joining the bloc may begin in June. It is worth remembering that the interaction of the EU member states is based on the observance of the four freedoms. It is about the free movement of goods, services, labor and capital, which includes land.

Thus, the legislation of the European Union prohibits limiting the right of land market participants to the movement of capital. But the current Land Code of Ukraine prohibits the sale of agricultural land to foreigners. Therefore, in order for Ukraine to be able to get the opportunity to join the EU, the specified norm must be removed from the domestic legislation.

It is also worth noting the current market trends - Ukrainian land is currently becoming more expensive. In Ukraine, in the first quarter of 2024, 25,700 agreements for the purchase and sale of agricultural plots with a total volume of 58,800 ha were concluded, which is 7% higher than in the fourth quarter of 2023, in which a record number of purchase and sale agreements was recorded lands for the entire time of the full-scale war. According to the results of the first three months of the year, the weighted average price of a hectare of agricultural land increased by 11.2% to UAH 42,000 per hectare. This is included in the forecasts of experts, who believed that in the second stage of the market, the price of land will increase by only 10-15%. Only the buyers themselves can increase the value of the land in order to persuade the owners of the plots to sell them. But even such actions of buyers will not be able to significantly affect the desire of the owners to sell the land.

We should also note that a little earlier the Verkhovna Rada of Ukraine adopted in the second reading and in general the draft law "On amendments to some legislative acts of Ukraine regarding the protection of the interests of owners of land shares (shares), as well as the application of administrative procedures in the field of land relations." According to official reports, the adopted version of the document includes, in particular, the following provisions: extension (from 2025 to 2028) of the term of registration of unclaimed land plots, implementation of the distribution of land plots between owners of shares and their heirs of lands remaining in collective ownership after the distribution of land plots .

Currently, it is envisaged to restore the mandatory training of certified land management engineers and to extend until 2026 the pilot project of entering information into the State Land Cadastre by certified land management engineers. In addition, a rule will be established according to which the term of validity of lease contracts for land plots formed from unclaimed (undistributed) land plots that have passed into communal ownership will be terminated 2 years from the date of state registration of communal property rights to them. In addition, the draft proposes to foresee the peculiarities of the administrative procedure in the field of land relations.

We would like to remind that from January 1, 2024, the second stage of land reform began in Ukraine. It provides, in particular, an increase in the maximum size of the plot for purchase from 100 hectares to 10,000 hectares. In addition, now not only individuals, but also legal entities will be able to buy land. At the same time, the requirement that only citizens of Ukraine can purchase land has been preserved. Earlier, at the end of 2023, a petition of the All-Ukrainian Agrarian Council was registered to postpone until the end of the war the increase of the maximum area of ​​agricultural land "in the same hands" from 100 hectares to 10,000 hectares. The specified petition gathered the necessary 25,000 signatures for its consideration by the President of Ukraine, who instructed the head of government to consider this issue. But so far, no decisions of the CMU on this issue have been reported.

We will also remind you that the land reform includes the third stage, which provides for the opening of the market for foreign individuals and legal entities. But the decision on this must be approved at the all-Ukrainian referendum, which cannot be held under martial law.