On September 25th, the Ukrainian government approved the first bill on land reform, opening the market to foreign investors.
“Today we approved the first draft law, the first of the land reform package. Today we will submit it to parliament,” Ukrainian Prime Minister Alexei Honcharuk announced.
On September 20th, about a thousand Ukrainian landowners in the Odessa region came out to protest against land reform.
As the Ukrainian prime minister said in early September, land reform will provide for the possibility of acquiring agricultural land by foreigners “provided that they register a legal entity in Ukraine and pay taxes here.”
Former Prime Minister of Ukraine Yulia Tymoshenko condemned the land reform, saying that it would sell 72% of Ukraine’s land to foreigners.
“The first thing this law is about is that 42 million hectares of Ukrainian land can be sold in full, including to foreigners,” she said.
Tymoshenko clarified that 42 million hectares of land is 72% of the territory of Ukraine.
She urged for a referendum before selling most of Ukraine to foreigners.
“Based on the election program of President of Ukraine Volodymyr Zelensky, I now appeal to the President of Ukraine on behalf of our party, on behalf of our faction, demanding: before you put down such bills on the sale of 72% of the territory of Ukraine to foreigners, [it’s necessary] to appeal to the people and to hold an all-Ukrainian referendum to find out if there is support for Ukrainians in the sale of agricultural land actually under the hammer,” she urged.
She explained that quite possibly anybody could purchase the Ukrainian land.
“Under the law, land can be sold to Ukrainian citizens, including those who have dual citizenship. And the second – legal entities can be buyers of land if they are created according to the law of Ukraine. But we all know that Ukrainian enterprises can be registered under the law of Ukraine, where 99% of the ownership of the company may belong to foreign citizens or foreign companies,” she clarified.
She also criticized the assertion of the Ukrainian government that the sale of land would not allow it to be concentrated in one hand.
“The law provides that one can take 210 thousand hectares of land in one hand, that is, one enterprise with foreign investment can buy 210 thousand hectares of land. And several affiliates can buy up to a million hectares of land, that is, this is the development of an agrarian oligarchy, which is destroying the agricultural sector of Ukraine,” Tymoshenko said.
The Ministry of Economic Development, Trade and Agriculture of Ukraine on September 20 published for discussion a draft law that provides for the lifting of the ban on the sale of agricultural land from October 1st, 2020.
It is noted that citizens and legal entities of Ukraine, territorial communities, and the state can acquire such plots. At the same time, the draft law contains a norm that individuals and legal entities, foreign states that fall under the sanctions law will be deprived of the right to purchase land.
There is also a loophole in the land reform: foreigners can acquire the right of ownership by will. This, incidentally, is one of the existing schemes for the shadow sale of land in Ukraine. This would potentially be made legal.
As Tymoshenko mentioned, the law includes restrictions on the concentration of land: one owner can own no more than 15% of the land within the boundaries of one region and no more than 0.5% (approximately 213.6 thousand ha) within Ukraine. But the real area of Ukraine now is a matter of political interpretation.
“If within the framework of monitoring it becomes known that some Russian or Russian company has become the owner of Ukrainian land, the land will be confiscated,” promises Deputy Minister of Economy, Trade and Agriculture Taras Vysotsky.
It is clear that a certain amount of land is already owned or leased by Russian companies and citizens. That even includes the “new Russians,” political emigrants from Ukraine who became citizens of the Russian Federation over the past five years.
Another important topic is Crimea. The citizens of Crimea are Ukrainians, as the Ukrainian government continues to maintain. Many of them own land in mainland Ukraine, and all of them have Russian passports, since Crimea became a part of Russia. What would happen to them? Would they lose their property, and will they be allowed to purchase land, after all they’re Ukrainians?
The dire state of the Ukrainian economy has left it in a precarious situation in which the only thing to sell is land. Ukrainian President Volodymyr Zelensky and his government may throw Ukraine into an even more severe crisis than what former President Petro Poroshenko managed to cook up.
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