Lease of state and communal land

The armed aggression of the Russian Federation against our country continues, however, even in such a difficult situation, the economy of Ukraine must work. That is why the question of renting land that is in state or communal ownership is an urgent issue. If you plan to rent the land for a certain period, the specialists of our legal office Prykhodko and Partners will help you with this.

Legislative framework of the issue

Leasing of land is provided for by the Land Code of Ukraine (we are talking about Article 124). The following is stated in the Land Code: plots in communal or private ownership are leased based on the decisions of the relevant local self-government body or executive authority (Article 122 of the Land Code).

If land auctions are held for the lease of land that is in state or communal ownership, a person can submit a corresponding application and support it with a package of documents (Article 137 of the Land Code).

With the introduction of martial law in Ukraine, the Law of Ukraine enters into force, which specifies changes to some legislative acts (subparagraph 7, paragraph 27 of the Transitional Provisions of the Land Code of Ukraine). According to the changes made, from April 2022, land auctions related to the transfer of lease rights to plots of land that are owned by the state or owned by communal institutions and additionally have an agricultural purpose have been canceled. Currently, land auctions for agricultural land are conducted only in the Prozorro electronic system. As for the transfer of land by direct agreement, it was cancelled.

Let’s consider the issue of the amount of rent in more detail. The rent is specified in the lease agreement, however, the amount of payment per year cannot be less than the amount of land tax.

Peculiarities of drawing up contracts during martial law

All contracts related to the lease of state and communal property are drawn up exclusively in electronic form. Such contracts are not automatically renewed. This means that the tenants will not have a preferential right to conclude a similar contract for a new term or to purchase the land plot in case of its sale. This also applies to land that is subleased or repurposed.

After martial law is terminated or abolished, all concluded/renewed contracts, in accordance with the law, will continue to be valid until the time of their conclusion expires.

Please note: there are currently 2 prohibitions on communally and state-owned lands. First, a ban on the free transfer of land was introduced. This means that land that belongs to the state or is in communal ownership cannot be transferred to private ownership.

Secondly, land auctions are prohibited. This applies to land transactions that are related to lease rights, the surface of communal or state-owned agricultural land plots. Bids that have been announced but not completed by April 2022 are considered cancelled.

Thus, martial law is accompanied by a ban on the free transfer of communal and state-owned land into private ownership.

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