SIMPLIFIED LAND LEASE DURING MARTIAL LAW

On 7 April 2022, Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine on Ensuring Conditions for Food Security under Martial Law” No. 2145-IX (“Law”) came into force.

The Law simplifies granting the rights to use agricultural land plots and land shares (“Agri Lands”) to ensure a sowing campaign during martial law. In particular, the Law:

• automatically extends for one year all Agri Lands use agreements that expired during martial law;
• empowers district military administrations (“Administrations”) and some permanent land users to lease out the Agri Lands for up to one year, provided that:
  • the Administrations may transfer the Agri Lands into lease exclusively for commercial farming;
  • lease agreements are executed in electronic form with a qualified electronic signature;
  • rent does not exceed 8% of the Agri Land’s normative monetary valuation;
  • instead of registering a lease right in the State Register of Proprietary Rights to Immovable Property, the Administrations must register lease agreements in the Book of Land Possessions and Land Use Registration which must be developed by 8 May 2022;
  • information on the Agri Lands that were formed for further leasing out by the Administrations, is not entered into the State Land Cadastre;
  • a tenant has no right to renew or re-enter into the agreement, transfer the Agri Lands into sublease, establish easements, construct on, divide or merge the Agri Lands, change their designated use, etc.;
  • the agreement will terminate upon expiry of its term, regardless of whether the martial law is lifted;
• releases landowners and land users from liability for non-use of the Agri Lands in accordance with their designated use;
• cancels those land auctions for the rights to use the Agri Lands that were announced but not completed by 7 April 2022 and prohibits new auctions; and
• prohibits free of charge privatisation of any land plots.

We believe that such amendments will prove their effectiveness in ensuring continuous agricultural production during martial law and will restrain the reduction of grain yields.