Economic Consequences and Risks When to Talk about Purchase of Land in Ukraine

by Anastasiia Lieberman
Wednesday, September 29, 2021
Economic Consequences and Risks When to Talk about Purchase of Land in Ukraine

Find out how to secure your business and be confident when buying land in Ukraine

The consequences can be very different, but all the changes speak only about positive results! First, the purchase of investing-in-ukraine/business-opportunities/agricultural/" rel="dofollow">agricultural land will become a new mechanism for investment. Rentiers can receive up to 10% of the invested funds of the annual income in the form of rent.
On the other hand, many experts say that the purchase of land for figureheads is up to 100 hectares. This possibility should not be excluded, since there are enough mechanisms to guarantee the protection of the rights of the "real owner", but it is doubtful that such schemes will become widespread.
Agricultural producers who lease shares, for their own safety, from July 1, 2021, must buy out the offer of plots that they have leased. However, they are not directly endowed with such a right. The compensation mechanism, which will allow tenants to indirectly buy out the leased land plots, is laid down in the law through the introduction of the right to transfer the pre-emptive right to third parties. With the help of this provision, the current tenant will be able to transfer his pre-emptive right to purchase a plot to a third person – a citizen (most likely, it will be a related person), notifying the owner of the land.

Thus, the bill carries a lot of risks:

  • it is possible to repeatedly sell the pre-emptive right by unscrupulous tenants;
  •  fraud and conflicts due to violation of pre-emptive rights, since information about the cost of land plots under the agreements will remain hidden and the tenant will not have evidence regarding the sale price;
  • it is especially important to properly use the preferential right for companies with foreign investments, because, unlike Ukrainian owners, it is difficult for them to find and trust Ukrainian citizens who can act as buyers of land.

GT Invest recommends that you carefully and responsibly approach the contract of sale of a land plot and not use standard contracts available, for example, on the Internet.

Firstly, because the legislation of Ukraine in the field of land relations changes quite often, and therefore the contract, quite high-quality and professional, prepared half a year ago, may well be irrelevant at the moment.
Secondly, the language barrier can lead to the fact that a foreign citizen simply does not understand the casual points that are in the contract, which can lead to difficulties in the future. Please note that we are not talking about situations of malicious intent of the seller, which also sometimes happens. Also, a preliminary check of the reliability and history of the seller and the land plot being sold, for example, the presence of legal disputes, encumbrances, etc., will not be superfluous.

Having extensive experience, we will easily collect all the documents that you will need to purchase a land plot on the territory of Ukraine.

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