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Abstract

Content

Introduction

The land is a necessary condition for a normal life and work of each person and therefore acts as a particular object of civil relations. Plots recently became the objects of sale – the Land Code of Ukraine [1] was adopted only in 2001 and the Civil Code of Ukraine [2] is only valid from the beginning of 2004 but, despite this, the number of land transactions are is sufficiently large and the number is increasing by the day. A role in this is played by rising land prices in the capital and its suburbs, as well as in other major cities of Ukraine. And if earlier by one of the most profitable investment was the purchase and subsequent sale of residential real estate, it is now the first position is investing in the purchase of land.

1. Relevance of the topic

The relevance of the topic is that the functioning of the land market provides an opportunity to implement a number of important socio-economic processes in Ukraine. The land market allows you to control the real estate market because it creates opportunities for legal appropriation of land, which would make impossible the existence of the shadow land market. Besides, it guarantees the unity of the property, financial and land ownership rights to real estate. All of this has been promoting the rational redistribution and regulation of financial flows in the economy. Due to the functioning of the land market is expanding material and financial resources of local communities, while providing additional sources of revenue for local budgets. The land market is able to create conditions for a more active investment of foreign and national capital in the land itself.

The implementation of all of the above provisions is possible only if the normative and legal provision of functioning land market. Today, a number of questions on the sale of land is not settled, resulting in a significant decrease in activity in this sector of the economy. A decrease in activity in the land market in Ukraine shows a diagram which shows the dynamics of sales of non-agricultural land in 2008-2012. Over the past 5 years the market transactions in government non-agricultural lands brought to local budgets UAH 7 billion. income. But compared to 2008, to the present, land transactions was several times smaller.

The dynamics of selling non-agricultural land (mln.) In 2008-2012

Figure 2 – The dynamics of selling non-agricultural land (mln.) In 2008-2012
(animation: 5 frames, 96 kilobytes)

Hence, the study of legislative regulation of land by improving the legal framework is important.

2. The purpose and objectives of the study, expected result

The aim is to identify the gaps in the legal regulation of land sales.

Research objectives:

1. Examine the existing laws and regulations that govern the sale of non-agricultural land;

2. Develop proposals to address the shortcomings in the current legislation.

The object of study – flaws legislation on the sale of land in Ukraine;

The subject of the study – non-agricultural land.

Planned result – the identification of gaps in the law for the sale of non-agricultural land and the development of proposals to address them.

3. The main part of the abstract

In a market environment is a continuous redistribution of land, allowing its effective use. This redistribution between the owners of land is carried out mainly through the sale. And if the sale of land of private property adequately regulated by the Civil Code of Ukraine, the sale of land and utilities and public property has a number of features that are not fully subject to the law [3]. In my work I focus on them.

Sale of land is regulated by several laws and codes of Ukraine, Cabinet of Ministers, Presidential decrees, laws and regulations of local governments. They are:

– The Land Code of Ukraine of 25.10.2001 № 2768-III;

– Civil Code of Ukraine of 16.01.2003 № 435-IV;

– Law of Ukraine "On Mortgage" from 05.06.2003 № 898-IV;

– Law of Ukraine "On peculiarities of privatization of assets under construction" of 14.09.2000 № 1953-III;

– Law of Ukraine "On Privatization of State Property" dated 04.03.1992 № 2163-XII;

– Resolution of the Cabinet of Ministers "On approval of the alienation of state property" from 06.06.2007 № 803;

– State Committee on Land Resources "On approval of licensing conditions of the business of holding land auctions" from 08.10.2010 № 724;

– Regulatory and legal documents issued at the local level – Temporary orders of land auctions in the fields.

Article 134 of the safety relay [1] indicates that the land plots of state and communal property shall be subject to compulsory sale by auction. Land auctions are the most effective option for local budget. Over the years, even the most diehard skeptics were convinced of the benefits of the sale of land in this way. First, it is a weighty replenishment of local budgets (history Ukrainian auctions indicates that the price of the object in the course of trade could rise by an average of 3 times). Second, the investor who buys a public entity and regularly pays taxes to work reliably – say experts.

Figure 2 shows the evolution of land auctions in the city of Sevastopol, the organizers of the trade which was the Sevastopol City State Administration. The dynamics shows that the selling price is much higher than the starting price of the land. Therefore, to sell the land at auction profitable.

Dynamics of land auctions in the city of Sevastopol, the organizers of the trade which was the Sevastopol City State Administration

Figure 2 – Dynamics of land auctions in the city of Sevastopol, the organizers of the trade which was the Sevastopol City State Administration

The acquisition of land by auction buyers and convenient as exempt them from having to spend a few months on the design documentation for land ownership. But we must recognize that there are a number of common problems related to the auctions.

The first thing that you need to pay attention – this is non-settlement of the legislation. Today, many lawyers are unanimous in saying that businesses are increasing their risks by engaging in land auctions, and regulatory framework which is not finalized. And the duty of the authorities – to ensure the conditions for the normal development of the market of non-agricultural land of communal and state property.

There is also the problem of lack of expertise and the necessary experience. Conduct auctions to deal with a specialized company that has enough experience in the auction and qualified staff. To conduct the auction should litsitator – an individual with special training. Given the fact that the auctions in Ukraine are unstable, gain experience in this area is very difficult. Unfortunately, at the present time such specialists units [4].

In 2008, the Land Code of Ukraine was amended to prohibit the provision of land plots of state and communal ownership of the principles of non-competitive except for clearly defined cases. But the law, which would define the order of the land auction, as required by Article 137 of the Land Code of Ukraine, was not adopted.

To resolve this issue, the Cabinet of Ministers of Ukraine adopted two of the Procedure of land auctions, approved by Decree № 90 of 17.04.2008 and № 394 dated 17.04.2008 of the year. They defined the procedure for preparing, organizing and conducting land auctions for the sale of land and utilities and public property. However, the Constitutional Court declared unconstitutional by these regulations, and decrees of the President of their license was suspended.

There was a conflict of laws – the Land Code provides for the expropriation of land only through an auction, and a nationwide procedure of the meeting – is absent. The absence of a law regulating the procedure for holding auctions for many years, forcing local authorities to define such a procedure on their own. The fact that these decisions were "outside the law", has led to uncertainty about the legal status of the successful bidder, as it calls into question the legitimacy of the prisoners in trading contracts.

Law of Ukraine "On Amendments to the Land Code of Ukraine regarding the order of the land sales by auction" from 05.07.2012, № 5077-VI [5] changes to the Land Code of Ukraine of 25.10.2001, № 2768-III (on the safety relay) on the procedure for land sales by auction. This law in the new wording of Article 135-139 safety relays, the scope of application of these articles, as well as their volume is significantly expanded. For example, the new version of Article 137 of the Land Code consists of 31 instead of 5. The law defines the legal status of participants in land auctions, fixes the principles of competition and provides guarantees to participants as land sales, as well as winners. Adoption of the law makes it possible to conduct land auctions, which was previously extremely difficult due to the absence of the procedure established by law. However, it can be stated that the Act was characterized by a number of significant shortcomings [6].

1. Excessive formalism of the new rules is a major obstacle to the auction. The Law of Ukraine "On Amendments to the Land Code of Ukraine regarding the order of the land sales by auction" is packed with the requirements, compliance with which is not essential for transparent and efficient conduct of the auction. Only to gain the status of the auction, you must go through a certain procedure: in addition to the application, you must provide a wealth of information, as well as documents confirming payment of the executor of land sales registration and guarantee fees, and before pay these fees to get the supporting documents, a certificate about the Application to register as a member (part 7 and 8 of the new version of Article 137 safety relay). Moreover, the law provides for two registration: – One registration not later than three working days before the auction (part 7 of Article 137 of the Land Code), the second – on the day of trading (part 9 of Article 137 of the Land Code). With so many formal requirements significantly increase the risk of non-compliance that threatens the legal status of the parties to the agreement concluded by the results of the auction. Restricting the same access to trading participants will keep their competition, so – setting the highest possible price.

2. One of the many examples of "formalistic" approach to regulation of land sales is also the "rule of three minutes." Instead, declare a winner after three announcements of price, if none of the participants will offer a better price, part 19 of article 137 of the safety relay is provided in the announcement of the winner, if within three minutes after the triple repetition of the last price is not offered the highest price. This deviation from the regulations may, under certain circumstances, be grounds for challenging the contract concluded at an auction. At the same time, there is no feasibility to establish a specific time period was not, in fact three times the price announcement – time, more than enough for the participants to make suggestions.

3. Some experts believe the positive rule 24 of Article 137 of the Land Code, under which the contract between the organizer of land sales and the winner is the day of the auction. During the review of the law was rejected by the best option, well-proven in the countries with developed legislation on auction sites such as Germany, the United States, as well as the well-known Ukrainian legislation (for example, Article 45-47 of the Law of Ukraine "On Mortgage"). This alternative provides for the conclusion of the main contract directly at the announcement of the winner.

As the experience of the application of the Law of Ukraine "On Mortgage", the stage of entering into a written notarized agreement at the auction is superfluous. It unnecessarily complicates and increases the cost of the procedure and creates unnecessary problems – when one of the parties refuses to sign a written contract. Requiring the signing of the contract, "the day of the auction" does not solve these problems, says Doctor of Law, Professor, Head of the Department of Land and Agrarian Law of the Kiev National University. Shevchenko Anatoly Miroshnichenko.

4. Another disadvantage is the prohibition of trading if they involve only one party (part 4 of Article 138 of the Land Code), and the requirement for participants to bid above the home, threatened the auction is not held (paragraph "b" of Part 4 of Article 138 LC of Ukraine). If the announcement of the trading was done in the prescribed manner, and it has been stated truthful information, the emergence of a buyer who is willing to enter into a contract for an initial price means the identification of the true demand and the current market price. Rejection of a bid in this case will only mean that the time and resources to prepare the auction have been wasted, and the goal – selling at the highest possible price – is not achieved. Therefore the land, which is being auctioned by simply remain unsold.

5. According to Part 29 of Art. 136 Land Code provides that in the event that the winner of the auction of foreign states or foreign legal entities contract of sale of land is only after obtaining approval of the Verkhovna Rada of Ukraine and the Cabinet of Ministers of Ukraine on the sale of land to such persons in accordance with the Land Code. Moreover, in case of failure of the Verkhovna Rada of Ukraine and the Cabinet of Ministers of Ukraine in this agreement, auction lot (this parcel of land), bought by a foreign state or a foreign legal entity is considered to be one that did not take place. This situation can be improved so that the agreement on the sale of land to foreigners granted not after, but before the land auction [7]. From vyshenapisannogo can conclude bulkiness and riskiness of land auctions in accordance with the established order. The legislator must return to the issue of regulation of land auctions and eliminate shortcomings in the Law of Ukraine "On Amendments to the Land Code of Ukraine regarding the order of the land sales by auction."

Conclusion

Analyzing the experience of land auctions, these problems are inexhaustible. Operational solutions first requires improvement of legislation. But it should be noted that in spite of all these shortcomings, in Ukraine, there are great prospects for the successful introduction and development of land sales on competitive basis, which, in turn, will lead to increased formation of a land market in Ukraine. The authorities need to understand that the auctions – a profitable investment that will pay for itself in no time. Purchase of land, on a competitive basis will bring the most profit to the state.

During the writing of the abstract Master's work is not yet is completed. The final completion of: January 2013 of the year. Full text of the work and materials on the topic can be obtained from the author or his manager after that date.

References

  1. Земельный кодекс Украины № 2768-III от 25.10.2001 г.
  2. Гражданский кодекс Украины № 435- IV от 16.01.2003 г.
  3. Купля-продажа земельных участков (консультация юриста) [Электронный ресурс]. – Режим доступа: http://bin.ua/news/economics
  4. Проблемы проведения земельных аукционов в Украине [Электронный ресурс]. – Режим доступа: http://livejournal.com/
  5. Закон Украины «О внесении изменений в Земельный кодекс Украины относительно порядка проведения земельных торгов в форме аукциона» от 05.07.2012 года № 5077-VI
  6. Журнал № 07.12 «Земельне право України» стр. 24 «Законопроект про земельне аукционы: шаг вперед есть, хотелось бы еще несколько» Кулинич П.Ф., доктор юридических наук, заместитель заведующего отдела проблем аграрного, земельного и экологического права Института государства и права НАН Украины
  7. Не в торгах счастье [Электронный ресурс]. – Режим доступа: http://www.eucon.ua/