Kareli Method "Comprehensive Land Reform"

Preface. While starting this work Iwas aware of a huge responsibility. When publishing articles on differentsites, I have received letters and feedback, they provided the impetus for theimplementation of my long - standing ideas- this project is the presentation ofideas from all my articles and accumulated ideas.

For your consideration, I offer mythoughts on existing problems in the legislation, and the state of affairs inland relations and suggest ways of solving them. Actually, the problem is more profoundand multifaceted than a simple "open or not land market." I am suremy ideas would have the opposite opinions, as "for" and "against",I will be equally happy because it can be the basis for beginning a deeperdiscussion of such pressing issues and problems.

I hope for your activity in yourfeedback and I thank you in advance.
In the project Kareli Method "Comprehensive land reform" activitiescontributing to the completion of land reform and launch a full-fledged landmarket in Ukraine are discussed (48 pages A4).
The project includes 2 bills

The project is aimed at legislators andspecialists of the land industry, land share owners, and a wide range ofreaders interested in land relations

Kakhaber Kareli

Doctor of economic Sciences,

expert on land issues,

Georgia (nationality) / Ukraine(permanent residence)

email: [email protected]

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©.K.Kareli.2016. All rights reserved. 

If the state carriesout  the pilot market launch by auctioningof public lands (as planned 1 million hectares), before the lifting of themoratorium and without share division of private land, it can cause majordiscontent (to put it mildly)of the population who were patiently waiting foryears. In the case of the implementation of land-share division process notless serious problem can be leases for the units that would have to be cancelled,that, probably, will not pass without numerous court interventions. About thedangers of financial intervention from the outside complains Yan Belogolovy(lawyer on land issues, "On consideration of the issue over the sale of 1million hectares of public lands", liga.net that 01.03.2016

There are a lot ofthought about shares and allocation of shares. According to the people's deputyof Ukraine Arkady Kornatsky: "if he (the owner of the unit – author’snote) sells the land (to the state – author’s note) at a price close to theminimum reasonable for investment to be justified, then this peasant, inaddition to the price, must get the rent during all his lifetime".(112.ua, 15.09.2015).

The questions arise:how much it will cost to the government the lifetime allowance to shareholders,is it reasonable to pay the owners of the units during their lifetime forordinary yet even solid profit? Who will install "close to the minimumfeasible price: the state or audit? If the state- does it have the necessarynumber of qualified personnel? If the audit - who will pay for its services? Arereasonable and market prices two different things? What if it is used on thepart of the functionaries to pressure on shareholders? There are a lot ofquestions, their number must be reduced to a minimum.

The desire of theowners of shares after the lifting of the moratorium to sell their lands is oneof the arguments against the alienation of shares. In various Internetpublications, there is different data about the number of people willing tosell their land. For example, M. Martyniuk cites that "According to the polls,20% of unit holders have allegedly declared their desire to sell it" ("Head of Gosgeokadastr: 20% of unitholders have indicated their desire to sell" zn.ua, 16.10.2015.), there isa little less quantity, according to the publication segodnia.ua- 10-15%("Land reform: does global redistribution threatens Ukraine,"15.05.2015). But   the People’s deputy of Ukraine from the fraction"Petro Poroshenko’s Block," the head of Committee on agrarian policyand land relations Taras Kutovoy expressed the view that: "no matter what anyonesaid, many owners of units today want to sell these units "("Kutovoy: many owners want to sell shares" agroportal.ua,16.01.2016. The impression is that the desire to implement their own shares isseen as a negative term of land share division, that the owners of the unitswant to do something illegal...

It should be noted that a million out ofseven million shareholders have died, approximately 30% are elderly people, andabout 12-15% are city dwellers. One of the main factors of the statisticaltreatment  of the units (by area) is  availability of agricultural equipment,information about which is clearly disappointing: according to statestatistics, one third of rural households treat the land in fatherly way - withhorses, and only 17% of households have equipment for field work (unian.net  04.03.2016. The same issue laments the head ofthe women farmers of Ukraine L. Klebanova, who notes that because of the smallamount of allocated funds the money is enough for the purchase of 1-1.5tractors for the region (infoindustria.com that 30.09.2015).  

The rent of agricultural machinery forprocessing of 4 hectares (according to Internet sites, the price of landcultivation alone starts from 240 UAH/ha), cost of seeds and chemicals may beunaffordable for many of the shares owners (especially pensioners), and citydwellers may be "should not" exercise such an investment. Who knows now,how they and other shareholders will behave after the lifting of themoratorium? A lot might depend on activity of real estate firms as for volume andactivity of the sale of land.   

Today it is impossible to specify eventhe approximate number of sellers of units, it can be significantly more of theabove data. And the question itself: "how much will be sold " isincorrect, because it does not specify the interested period of the activity ofthe process, because the real estate market is like a perpetuum-mobile - oncetaking the start, does not stop, as long as not being interfered.

Among other things, the moratorium is abright revealing social injustice in relation to the shareholders: at the time,when urban dwellers could privatized their leasehold apartment, and fully gotthe rights of owners, shareholders still lack this opportunity.

According to the National Institute forstrategic studies of Ukraine, after privatization of the housing stock, 95% ofhouseholds have their own housing. With such an impressive figure, Ukraine is aleader among European countries by number of owners of apartments.Interestingly, in this category of the socio-economic aspects on the leadingpositions are representatives of the former socialist countries - Bulgaria -87%, Poland - 75%, Czech Republic - 55%, in Sweden the number of happyhomeowners is 17% and in the Netherlands is just 5%. It is noteworthy that thenumber of Ukrainian citizens wishing to improve their living conditions by helpfrom the state is more than one million ("Ukraine leads in the number ofhomeowners in Europe" obozrevatel.ua, 17.07.2013). 

Rural residents, creating products andpaying taxes to the state budget, contributed to the economic growth of thecountry. All those houses, which the city dwellers privatized, were built onbudget funds. It is impossible to compare the value of apartments obtained inthe property, with the cost of land units, it would be incorrect, because urbanstudio apartment (albeit on the outskirts), costs as much as a few tens ofhectares. To try to observe social justice at a cost of privatized assets(house/land) would be more than foolish, but to prevent division of villagers’shares is really unfair.

Another argument against the launch ofland market - the low price of land, and authors to justify their reasons makeparallels to the data of foreign countries. Taking into account the fact thataccording to Ukrainian legislation, only citizens of Ukraine have the right topurchase agricultural land as property, such comparisons are inappropriate. Itshould be noted that different sites presented different statistical data onaverage revenue and cost per hectare of land (tab. # 2).

The table shows the countries withproperly functioning land market, despite the fact that the prices differsignificantly. To launch the land market it is not necessary to wait foreconomic progress of the country- with Spanish or French level.

Tab. #2

The market always and everywhere setsthe prices by itself, they differ both among countries and within countries. InUkraine, the price of land varies: one hectare of agricultural land in Zhytomyrregion is 200 usd, Cherkasy - 800 usd, and in Tarashchansky area - 1100 usd.Prices for apartments in Kiev (center/suburbs) are in 4-10 times different fromeach other, but that does not give anyone the motive to suspend the apartmentmarket.

The delay in solving ofland issues for an indefinite time would only worsen the problem. The extensionof the moratorium is not a solution to the problem. It is the same as takingpainkillers during the incurable disease. When and what consequences this canhave, it is better to predict in advance. The value of reforms for Ukraine wasclearly expressed by former US Ambassador in Ukraine, research scientistof  Brookings institution Steven Pifer,who said at the Kyiv security forum: "If you get engaged in politicalgames instead of reforms, you could be in a situation when the West will turnaway from you. ... that the patience of the West runs out, it is notunlimited" (If the reforms in Ukraine will not take place, the West canturn its back on Ukraine – Pifer, nv.ua

You can't accept the factthat the moratorium serves to exercise the mind, to find ways to bypass it. Agood example of a legitimate violation of the law gives Victor Kobylyansky: theseller and the buyer after a pre-made agreement, execute a mortgage agreementfor the land share, after the debt is not returned, the case is referred tocourt. During the process, the parties conclude a settlement agreement underwhich ownership rights to the unit are transferred to the mortgagee-buyer(LAFAZAN, LAKAREN andt MORATORIUM, liga.net, 06.06.2016). Andrew Koshil(Chairman of the Association "Land Union of Ukraine", "How tobuy land for a garden in Ukraine", infoindustria.com.ua that 22.01.2016.)and Artem Repenko (Doctor of law, lawyer, Alienation of land: problems andsolutions". liga.net that 01.04.2016. also complain about mazes in landlaws.

Given the depth of theproblem, that can not be resolved for more than 30 years, the parties of landrelations should be aware of the almost hopelessness situation, and go on mutualconcessions. The state must analyze its miscalculations in determining themaximum rate of the unit, and the owners of the units - the absoluteimpossibility of obtaining the position of the shares in full. Only in case ofreaching a compromise, it is possible to complete the land reform initiated inthe 90s of the last century and run a full-fledged land market.

The author of the project is asupporter of the free market. But the launch of the land market today, underthe existing legislative framework, taking into account the wishes of thegovernment to carry out the opening of the market by experimental auctions, heconsiders it a hasty step and a threat to the economy of Ukraine and stabilityof the country as a whole

Ukraine, seeking tojoin the common European family, will have to adopt the universal Europeanvalues, and in Europe, the protection of property rights valued not less thanthe protection of human rights in General (Kakhaber Kareli "Will  the EU close eyes on the non-existence of a landmarket in Ukraine", liga.net that 14.06.2015.)

In March of this yearthe President of Ukraine Petro Poroshenko urged the political forces and thepublic to discuss the formation of a land market in Ukraine. The lifting of themoratorium on sale of agricultural land and the launch of the land market isone of the requirements of Ukraine's key creditor – the International monetaryFund ("the Sale of land and other terms and conditions IMF: would theUkraine for tranche", business.vesti-ukr.com, 20.05.2016.

The problem of landrelations is old but urgent, the delay of ordering of problems, magnifies it.The problem should be addressed comprehensively, after thorough analysis, todetect errors and mistakes made in the process, and to identify ways of solvingthem. A clear and proper goal setting will guarantee to achieve the finaldesired result. And most importantly: the people must believed in theimpartiality and objectivity of such an important process, so they shouldbecome a direct performer of the whole process. Speaking about reforms, theU.S. permanent representative to the UN, Samantha Power noted that many of thereforms remained "still on paper" and "it is Important that theUkrainian people remained involved in reforming" ("Samantha powerurged Ukraine to reform "not on paper", G. 11.06.2015 tsn.ua).

It is necessary tomake decisive steps (even unpopular, first of all, to admit mistakes andmiscalculations), the importance of which must be reasonably and objectivelyproved. The confusion and indecision of action provide stable stagnation ofaccumulated problems; correct vision of causes of these problems (but notdeclaring problems as they are) would greatly facilitate the search of ways outof existing maze.  

By having prolongedthe moratorium for a year, the government has made another mistake. Without a clearplan and with vision problems, it would be better to extend the moratorium for2-5 years, than by annual renewal attract the attention of its own population,as well the global community that will have to wait for the onset of the1stJanuary 2017 with one question: what will happen to the moratorium. It casts ashadow on the state itself, on its unwillingness to reform and the ability ofqualified Ukrainian experts, whose voice should be heard. Taking allcircumstances into account, we can foresee that a moratorium will again beextended. 

The present problems is anatural outcome of mistakes and miscalculations made in the early years. Thisproject is an attempt to address those mistakes, to draw conclusions andidentify ways to eliminate/reduce problems. The variety of terms offered by thegovernment for the redemption of unit sections, can cause confusion anddistrust to the evaluation of units. Use of annual land rent as a unit for countingthe purchase price of the shares proposed by the project is an unbiased methodthat does not leave questions or doubts.

Comprehensive Land reformis seen as the only impartial, transparent, objective and reasonable method forthe solution of long-standing problems, existing today in the land legislationof Ukraine.

 2.The purpose of the project

The aim of the project is:

• Preparation ofrecommendations for changes to the legislative framework with the aim ofcompleting the land reform and launch of a full-fledged free land market.

• The establishment of thecivil right of land ownership.

• To demonstrate positiveand negative aspects of the moratorium on selling agricultural land

• Eliminating the shadowland market and corruption in land relations as a whole, providing move of allthe shadow relations in civil.

• Transparency, democracyand accessibility for all stakeholders in the process of comprehensive landreform.

• Involvement of localadministrations and the shareholders, cadastral companies and notaries in theimplementation of comprehensive land reform.

• Streamlining of reliableinformation of land use.

• To demonstrate a highlevel of democracy and transparency of the process, permanently to inform thepublic about the work done,through the media.

• Identification ofresources for the revitalization of land relations on the civic level.

3. The goalof the project

The objective of the project is:

• A model for the completion of landreform.

• The establishment of initiativegroups of shareholders who together with local authorities will implement acomprehensive land reform.

• According to the final data of theintegrated land reform in a particular village, to analyze for generalizationfor all land shares.

• Creation of conditions for launchinga full-fledged, democratic and transparent land market.

• To demonstrate the economic effectfor the state treasury and the development of different structures, both publicand private sectors.

• At the end of the work, to publish amanual for conducting similar work throughout the territory of Ukraine, inparallel with work to conduct extensive outreach.

4. Strategyand method of the project.

4.1. The strategy of the project is:

• A set of forms of land ownership:common ownership (articles 86 of Land Code of Ukraine) and personal farm(article 25 of the LCU).

• Joint work of all public and privateentities that have contact and experience in land relations,

• Collection and elaboration ofinformation about the actual situation in land relations;

• Comprehensive land reform - a set offorms of ownership of private farm (Art. 25LCU) and common ownership(article 86 of the Land Code of Ukraine).

• From the total square of share unit,1.00 hectare is transferred to the owner for personal use, and the remainingland of the area of the unit is transferred to common ownership.

• Create an array of common ownershipfor the lease. 

4.2. Method ofimplementation of the project.

The project isimplemented by the initiative group, created by the author of the presentproject, in close liaison with the regional service of the Ministry of agrarianpolicy and food of Ukraine, initiative group of shareholders and the localadministration, cadastral company (running 3-4 groups), the notary.

All work is performedin strict compliance with the Ukrainian legislation.

During theimplementation of the project, the main priorities are the interests of boththe state and the shareholders. In the event of any dispute through jointdiscussions of the problems to find common ground that will serve as a basisfor the desired positive outcome of the process.

All decisions aretaken by absolute consensus. In the case of the hopelessness of the problems(ideological confrontation), it is recommended referral to the court.

Everyone who wants todisengage the share unit, has to appeal to the local administration.

For the efficiencyand transparency of the process, it will be created an initiative group by the shareholders,whose members will represent the interests of the members of the subgroups (basedon quarters of the array). The initiative group will be based in the buildingof the local administration.

Each stage of theimplementation process will be discussed in the meetings of the initiativegroup of shareholders. The frequency of meetings of group members with theshareholders of the sub-groups can be held due to the situation, but at leastonce every two weeks. The  representatives of the subgroups will berequired to inform the members of the subgroups about the taken decisions.

Meetings of theinitiative group both with shareholders and other parties of the process, willbe organized according to the situation, but at least once per month.

If necessary, the actcan written on the results of meetings, which is certified by signature andseal of the head of the local administration.

Laboratory work withthe documentation is conducted- the number of units and their total area isstudied.

After concordance ofpositions, the arrays for division are selected.

Selected array isplaced on the existing in the local administration map, and is certified withthe seal and signature of the head of administration. The act is written. Theact together with a map, is sent to the regional Department of the Ministry ofagrarian policy and food.

Plots of land forcitizens’ private ownership are allocated strictly on the outskirts of thatland mass, part of which these sites are.

The promisinglocation of plots is selected according to the proximity of residential houses ofa stockholder, or other area (if there is one, on his or her choice).

Selected on the map arrayis divided into prospective areas, and each site is given an individual number.Allocation of plots is produced exclusively by drawing lots. After thefindings, on the basis of mutual consent, it is possible to exchange plotsamong the shareholders. The Final outcome is proved by an act.

Out of the total areaof the unit, 1.0 ha is allocated for transfer to private property (plots ofland for subsidiary farming).

According to the LandCode of Ukraine, public act is made for every part of a farm for transferring  into ownership, and for plots of land ofcommon ownership the certificate is made. The old certificate of the land shareis cancelled.

Transfer of the act,which shows the boundaries of the land parcel, is made directly on the plot.

5. Estimated project development time

The terms of projectdevelopment are designed for work in particular administrative unit, with thenumber of share units 300-400.

• Work with the localpopulation and the administration - clarification and coordination ofpositions, in the event of a dispute- making appropriate suggestions - 5-10working days (hereinafter-w/d);

• Office work withdocuments - 10-20 w/d;

• Visual inspectionof the territory - 5-10 w/d:

• Final coordinationof positions of the local population and administration - 5-10 w/d:

• Field topographicsurveys, demarcation of units with fixed borders (3-4 working group) - 20-30 w/d;

• The draw for theparcel of shares between shareholders, making the final act (quarterly) - 5-10 w/d;

• Notarization of thedeed of purchase and sale between the owners of the units and the state- 10-25 w/d;

• Preparation ofdocuments and transfer of plots to the owners-10-25 w/d;

The implementation ofthis project in a particular village, with the number of units of 300-400, needs70-140 working days. The ideological confrontation of the population (includingshareholders) and meteorological conditions may have an impact on theobservance of the work schedule

6. The economic effect of the project

To prove theeffectiveness of the project, the author calculated the cost of thedisengagement of the units to be transferred to private property of citizens (7million units), purchase of shares by the state (27 million hectares), as wellas the income received by the state by transferring these lands to the lease.

6.1. Cash costs for theproject

6.1.1. The purchase of shares.

The question of thepurchase of part of a unit by the government may be evaluated as the dictatesof the state, and then be compared with the nationalization of the land.

To avoid this impression,the state must provide acceptable conditions to the owners of the units.

Today, the rent for landplots of agricultural purpose is defined by a presidential decree (02.02.2002)and is not less than 3% of the value determined by the Goszemkadastr. She, thenational average is about 400 UAH/ha.

The calculations were madebased on the purchase of 21 million hectares of land, with taking to accountthe attached draft Law of Ukraine "On completion of land reform by meansof complexity".

Purchase by the government of1.0 hectares, taking into account the purchase price of 400 UAH/ha, 20 timesmultiple of the payment, will cost about UAH 168.000.000.000:

21.000.000 X 400 X 20 =168.000.000.000 UAH

6.1.2. The cost of notarialservices.

Expenses on registration ofcontracts of sale (including 6% of the total amount) will be approximately 720000 000 UAH

6% of 168.000.000.000 =10.080.000.000.

Note: tender cansignificantly reduce costs.

6.1.3. The cost of cadastralwork.

Costs for cadastral workson demarcation of plots (fixation of borders), taking into account that thedemarcation of one area will cost 300 UAH for each phase (7 million)and  would be 2 100 000 000 UAH.

7.000.000 X 300 =2.100.000.000.

Note: tender cansignificantly reduce costs.

6.1.4. Total expenditure onpurchase of land.

All expenses of thegovernment for the purchase of 21 million hectares will cost about UAH180.180.000.000:

168.000.000.000 +10.080.000.000 + 2 100 000 000 = 180.180.000.000.

6.1.5. The cost of the project

The cost of the projectwill be presented/discussed in details if you are interested in the project.

6.2. Funds received by the state

6.2.1. By selling 1 million hectares of land

From the sale of 1 million hectares of public land expertsestimate income from 2 to 11 billion usd. Such a large scatter is due to thefact that area for sales has not been chosen yet.

6.2.2. By rent of 27 million hectares

The procurement by the government of the former unit areas(27 million ha) makes it the lessor, and the annual revenues will be around UAH10.800.000.000:

27 000 000 X 400 = 10 800 000 000.

6.2.3. By taxation of 7.0 million hectares of private landownership

After the transfer of 7 million hectares into the property, thestate Treasury will receive in the form of taxation about21.000.000.000-28.000.000.000 UAH:

7.000.000 X 3.000 (4.000) = 21.000.000.000 (28.000.000.000)

6.2.4. Profit as a consequence of income taxes (from the funds ofthe cadastral companies, notaries and banks)

 After the registrationof contracts of sale, in the form of taxes, the state Treasury will receiveabout 1948800000 UAH in the form of one-time premiums.

 6.3. The economic effect.

Purchase of 27 million hectaresof land by the government will cost 180.180.000.000 UAH, which is about 7.21billion usd.

According to variousestimates, from the sale of 1 million hectares of land it is possible to obtainfrom 2 to 11 billion usd. When you consider the selection of land plots forauctions, it is possible to cover the cost of the purchase fully, and in theform of taxes the state Treasury can receive about 1948800000 UAH.

The government, havingobtained 27 million hectares of land, from the rent of these lands willannually receive 10.800.000.000 UAH. Today, there is rate which sets the rentat least 3 % of the cost. It is stipulated in the presidential decree of Ukraine from 02.02.2002 G. Itshould be noted that the Verkhovna Rada registered a bill No. 3345 "Aboutprotection of the rights of owners of land shares" (authors - O. Lyashkoand O. Kuprienko, Lyashko Radical Party), which suggests rents of not less than10% of the value of land, that will be about 1330 UAH/ha. In the case of theadoption of this bill, the state from the lease of 27 million hectares of landswill annually receive about UAH 35.910.000.000.

The state, after thetransfer to citizens of 7 million hectares of land as shares in privateproperty, each year will get profit from 21.000.000.000 to 28.000.000.000 UAHin form of taxes to the budget.

From the calculations ofcosts and profits above it is obvious that the balance of the economic effectsof comprehensive land reform is definitely positive.

But, in addition toeconomic positive effects, comprehensive reform has a great moral and politicaleffect.

Note: all the calculationswere made taking into account the possibility that the state share parcels willbe purchased at 20 times the annual rent. Of course, the real situation will bedifferent from the situation of the proposed project. Part of the units will bepurchased in 10 fold volume, and some even will refuse to sell. It isabsolutely impossible to predict the behavior of shareholders. On this basis, actuallynecessary and predicted by this draft amount for the purchase of unit sectionswill be different, also there may be a difference between the data actuallyreceived to the state Treasury funds and predictable. The calculations weremade in order to prove the positive effect of the project.

7.The cost of the project

The cost of the project,with a detailed calculation will be presented if there is the interest in theproject.

The cost of the projectwill include:

7.1. Hiring by the author ofthe project a working group for the implementation of the project.

7.2. The works ofcomprehensive land reform in the administrative division were 300-400 unitsland units are located, hiring of 2-3 lawyers, 2 specialists in measuring.Costs for the purchase of the units and services of notaries, cadastralcompanies and banks are not provided.

7.3. The involvement ofadvanced students (8-12) from  legal,geodesic and land management faculties for practice on land relations, scholarshipprovided.

7.4. According to theobtained results, the publication of a manual (with a circulation of 2-5 thousand,depending on demand), on a comprehensive land reform. The guide will thoroughlydescribe the details of the whole process, including large text and graphicmaterial.

7.5. Blank certificates andstate Acts on land of common ownership and private ownership.

7.6. Advertising is theprocess of comprehensive land reform in the media.

8. Thesis ofthe project

8.1. The government's acknowledgement ofmistakes and miscalculations in the process of land reform.

8.2. The transfer of agricultural landin private property of citizens in whose legal use they are.

8.3. Division of area unit into plots ofprivate farms and common property.

8.4. Transfer into property 1.0 hectare(or smaller) square of land shares.

8.5. The multiplicity  of sums for the acquisition of shares,depending on the date of conclusion of the sale contract.

8.6. The use of annual land rent as a unitfor counting the purchase price of the shares.

8.7. Non-assignability of the shares inthe inheritance.

8.8. For maximum transparency andreliability of the whole process, the involvement of both the public andprivate entities, and the shareholders.

8.9. No sale (by auction) of stateagricultural land before the process of demarcation of the units.

9. Finalprovisions of the draft

The author of this project hasextensive experience in land relations:

• diploma with honours in specialty"Land Surveyor", agricultural Institute (1983);

• work experience over 30 yearsassociated exclusively with land issues: the positions from engineer landsurveyor at the design Institute, to the head of district registration serviceof the National Agency of Public Registry of Georgia, in different years wasthe chief of the three regional services;

• experience in land reforming: fromthe beginning of the land reform process in Georgia, was the curator of the 4areas;

• experience of work in internationalorganizations - the project of the world Bank (WB) and the internationalorganization for agriculture development (IFAD)- the chief of the districtregistration service (8 years);

• the theme of doctoral dissertation-"The results of the land reform and ways of its improvement by the exampleof Kvemo Kartli region", 2004.);

• participant of internationalconference of students (Academy of Agriculture, Jelgava, Latvia, 1982);

• training at the design Institute inthe city of Kalinin (now Tver, Russia, 1982.);

• participated in the development oflaws, legislation and benefits for land reform and registration;

• organization of 3 meetings/conferencesat district enrollment services; participant of many national conferences.

• took a course on land and realestate registration in the UK;

• author of numerous scientificarticles and publications in print and online publications, including on theUkrainian sites;

• in Ukraine, participated in manymeetings related to land issues, including the Verkhovna Rada of Ukraine;

• was invited to the internationalconference "Support for Ukraine" April 28, 2015.

Based on the foregoing, the author of theproject on his own experience clearly sees the problems that exist today inland relations and offers solutions to them.

According to the author of theproject, the government must recognize the gross errors and miscalculationsthat were made at the initial stage of the land reform in Ukraine, which arethe causes of today's problems. This may be unpopular, but a bold step could bethe basis of positive goodwill and trust of the population to the governmentwith solutions to land issues.

The author believes that today’ssituation is a set of problems, and must be addressed comprehensively. Thoseagricultural lands, which are in lawful use of the citizens of Ukraine, must bedeclared their private property; for the full functioning of civilized land market,to make the demarcation of land shares to plots of personal peasant farms(article 25 LCU) and common ownership (article 86 of the Land Code of Ukraine).

The author is an adherent of the freeland market, but the launch of the market under the current legislation is a greatererror than the effect of the moratorium. Years of unresolved problems even moreaggravated and put vital necessity of solutions to these problems on theagenda. Moreover, in his opinion, market launch by a pilot sale of one millionacres of public land fertile (as it is foreseen by now) before the process ofdisengagement of shares, is fraught with great danger, both economic andpolitical, and for the stability of the state as a whole (Kakhaber Kareli"Time bomb under the code name of a MORATORIUM", blog.liga.net).

According to the author, today'sattitude towards land issues is too passive and straight. Despite numerousmeetings at different levels, the lack of direct dialogue with the public(shareholders) is felt, as well as the ability of the government to admit theirmistakes, or of legislators to vary in solving the problem.

The author of the project believesthat both sides of the relationship, the government and population must realizethe hopelessness of the current situation today. The owners of the unitsdo not have discretion to dispose their own property or own their land sharesin full, and the government can not carry out either action without theconsent of the owners of the units and because of the inevitability land sharedivision. That is why only the mutual concessions from both sides will allowpositive solutions for many existing problems in land relations.

The Project

©.К.Каreli.2016. All rights reserved

The law of Ukraine "Ondeclaring agricultural land as the private property of the citizens in whoselawful use they are’’

Article 1. General provisions

Thepopulation of Ukraine uses the land for agricultural purposes for many years onlegal grounds. These lands have not  beenfully transferred to their property yet, and are public property, whichnegatively affects both the country's budget and objective and reliableinformation on land use in the country as a whole.

The currentGovernment of Ukraine selected democracy based on European values, where thepriority is respect for and protection of the rights of the owners, as thecourse of development of the country.

Consideringthe interests of both the state and the population, it is necessary toregularize land tenure in the country and to make the legalization of theselands as private property. That will be a step which encourages the free landmarket

Article 2. The procedure fortransferring land plots into private property

Agriculturalland, which as of 1 January 2016 is legally used by citizens of Ukraine, todeclare their private property.

Land istransferred to Ukrainian citizens as private property free of charge.

Article 3. The scope of the lawimplementation

The effectof the recognition of property rights apply to the land gardening,horticulture, country and personal farm. All the above land is described asplots of land to private ownership for agricultural purposes.

Article 4. The purpose of thehomestead lands of private ownership

When usingplots of private property for agricultural purposes, there is no need forchanges in purpose within the categories of agricultural land.

Transferringof plots of private property into other categories and changing their purposeare implemented in accordance with the Land code of Ukraine (article 20).

Article 5. Documents certifying the lawfuluse of land plots

Documentscertifying the legality of land ownership are the following: an extract fromthe family/house book from the local, extract from the land-corded book of theagricultural enterprise, a certificate from the archives, certificate from theBureau of technical inventory, Books of the members of garden association, thecourt's decision.

Article 6. The procedure of landregistration

The stateservice of Ukraine for geodesy, cartography and cadastre (Gosgeokadastr), registeras private property household land, when applying, attaching relevantdocumentation and measuring of the drawing.

The statetax service must make the appropriate changes in the tax base.

Article 7. The lack of restrictions onparcels acquired by the present law

Land,declared the property of the citizens by this law and registered by Gosgeokadastras private property, is not the subject to the moratorium on sale ofagricultural land.

Article 8. Final provisions

This Lawenters into force at the date of its publication.

The Cabinetof Ministers of Ukraine within two months from the date of entry into force ofthis Law provides for changes in the legislation of Ukraine, also in theregulatory framework of the relevant structures.

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The project

©.K.Kareli.2016.All rights reserved.

The law of Ukraine "Oncompletion of land reform by means of completeness"

Article 1. General provisions

This Lawdetermines legal, economic and organizational arrangements for the completionof the land reform and launch of a full-fledged land market and protection ofrights of land owners by the state.

Land reformheld in Ukraine was accompanied by errors which led to today's existingproblems, the main of which is the moratorium on sale of agricultural land.Because of the moratorium, Ukraine has failed to form a civilized andtransparent land market, which is one of the main characteristics for a modernand democratic state.

In thecourse of the land reform, 28 million hectares of agricultural land wereallocated to 7 million citizens of Ukraine. Free transfer of such amount offertile land into the property is impractical- it would adversely affect theagriculture, the economy and the stability of the Ukrainian state as a whole.

 To complete land reform, which began more thanthree decades ago and to launch a civilized land market, the process must becarried out by means of complexity.

Article 2. The scope of thelaw.

ThisLaw regulates relations related to the demarcation of parts of the area of theunit, provided for the transfer to the private property of citizens for privatefarming (Art. 26-8 of the land code of Ukraine), common ownership (article 86of the land code of Ukraine) and the purchase by the state.

Article 3. The completenessof land reform.

Comprehensiveland reform provides for the completion of land reform by means of completeness- aggregate of private (private farm) and common forms of land plots ownershipthat represent the parts of land units.

Article 4. Areas foreseenfor the partition of the units

Outof the total area of the unit, 1.0 ha of land is allocated to unit holders forpersonal farming free of charge; the remaining area of the unit is credited tothe area of common ownership or is purchased by the state.

Ifthe area of the unit is 1.0 hectare and less, the land share is transmittedentirely into the property.

Article 5. The parties and theparticipants of the process, their powers

1. Powers ofthe Ministry of agrarian policy and food of Ukraine

(a) the staterepresented by the Ministry purchases unit areas.

b) theMinistry performs the selection of banks, notary and cadastral companies ineach district for work. The selection is made solely by means of tender.

C) to observeand be a direct participant in the whole process.

g) At anystage to demand from the local administration and initiative group to acquaint itwith the progress of work, to make its comments and recommendations.

d) to controlthe actions of notaries and the cadastral companies, the compatibility of theirwork with the conditions described in signed with them contract.

(e) After thesigning of the contract of purchase and sale with the shareholder, to makemoney transfer.

g) to apply witha statement to the registration service for the registration of land acquiredas public property.

2. Thepowers of the local administration

a) toobserve and be a direct participant in the whole process.

b) ifnecessary to ascertain the acts and protocols of different meetings and themeetings of Ministry representatives, members of initiative groups andshareholders.

c) ifnecessary and at the request of the initiative group to present the necessarydocumentation for work.

g) togetherwith the initiative group to choose an array for transfer to the property forpersonal farming.

d) at anystage of the work to require from the initiative group to inform on theprogress, provide comments and recommendations.

3. Thepowers of the initiative group and its members

a) In aparticular administrative division for review and the transparency of theprocess, the initiative group is created. Shareholders quarterly select membersof the initiative group, who will complete the initiative group. The work ofinitiative group members is not paid.

Theinitiative group will be located in the building of the local administration.

The choiceof the members of the initiative group for the transfer of powers is made by willof the shareholders. It is drawn up, signed and confirmed with the seal of theadministration.

b) The memberof the initiative group protects the interests of shareholders who delegated him.At the meeting of the parties he voices the opinion of shareholders and aftermeeting acquaints them with the decisions.

c) Eachstage of the process is discussed in the meetings of the initiative group ofshareholders. Frequency of meetings of the group member with the shareholdersof the sub-groups is due to the situation, but at least once in every twoweeks.

Conductlaboratory work with the documentation - to study the number of shares in theunits and their total area.

Togetherwith the local administration to select the array to separate into sections by1.0 ha each, for transfer to the property under the personal peasant economy.

Based onlaboratory and field works, to ensure the drawing of lots among theshareholders of  divided in advance sites.

d) the groupmust ensure delivery of shareholders in the notary office for the registrationof contracts of purchase and sale as well as the presence of shareholders of  allocated areas for the delivery of land andtransfer of land Act.

Meeting ofthe initiative group, both with its shareholders and other parties of theprocess will be convened at the request of the situation, but at least once permonth.

Ifnecessary, the meetings shall be drawn and certified with signature and seal ofthe head of the local administration.

4.Powers of cadastral companies

a)Cadastral companies act strictly according to the items described in thecontract concluded with the Ministry of Agrarian policy and food of Ukraine.

b)The Company carries out the measuring and measured work on the site, selectedfor this purpose. When performing work it is guided by the cadastral data, asagreed between the parties.

c)The Company carries out the disengagement of the sections, and the fixing ofboundaries for the identification of objects (columns). Based on the obtainedresult, presents the map to parties for the draw.

d)The Company is present during the draw of areas and, if necessary, givesexplanations.

e)The Company is directly involved in the delivery of the parcels to owners atthe place, using the data of the draw.

5.The powers of notaries

Registrationof contracts about purchase of a share is notarized, by the notary office,selected by tender. Payment for notarial services must be made by the state.

Inthe case of the requirement of a stockholder, a contract can be  produced by another notary, payable to theshareholder

6.The powers of the Bank

Grantingfunds for shareholders is done by the bank selected by tender.

Ifrequired by the shareholder, to take advantage of other bank, in this casepayment of bank services is made by the shareholder.

Article 6. Shares purchase,the amount of purchase and form of payment

Thepurchase agreement for the unit is between the owner of the unit and the staterepresented by the district service of the Ministry of agrarian policy and foodof Ukraine, on the basis of the statement of the unit holder. The applicationis the only basis for the signing of the contract. Contracts are drawn up by anotary.

a)For agreements of purchase and sale entered into before 1 January 2018, thepurchase amount per hectare of the unit is 20 times the amount of the annualrent specified in the lease. For treaties concluded after the aforementioneddate, the purchase amount of one ha unit is 10-times the amount of rent. Thecontract can be concluded at any date, upon receipt of a statement of the unitholder. In the case of a contract signing after receipt by the shareholder ofthe annual rent, the amount shall be deducted from the total amount.

Thoseunit holders who do not take advantage of this law, shall receive an annualrent, in an amount according to the lease agreement.

Afterthe death of the owner of the unit, the land unit is not transmitted byinheritance, and is transferred to the state land Fund.

b)payment of the purchase price to be single, within 30 calendar days from thedate of registration of the contract.

c)the owner of the unit, when receiving the amount for the sale of the unit tothe state, shall be exempt from taxation, provided the tax code.

d)payment is made by bank transfer to the unit holder account. For a comfortablemaintenance for the population and reduce the cost of banking services, the bank- partner will be determined by tender.

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Article 7. Documentation onsites

Theplots generated after the disengagement of unit areas, in accordance withUkrainian legislation need:

•The state Acts on the passed in property areas of a farm,

•Certificates in the areas of common ownership.

Whenthe new State Act and Certificate are issued, pre-existing Certificate to theunit will be cancelled.

Article 8. The division ofshares and amendment of lease

Thework of delimitation of cadastral units is performed by certified companiesthat are selected by tender.

Forthe purpose of rational use of land and prevention of fragmentation of landareas, land plots for personal peasant economy are allocated strictly on theoutskirts of that land mass, part of which these sites are.

Thedemarcation and allocation of plots is produced exclusively after the harvestby the tenant or by monetarycompensation of the harvest costs by a shareholder to the tenant on the basisof mutual agreement between them...

Thedivision of the area (s) of the unit is not allowed to be withdrawn or transferredinto ownership, when:

•the lessee made capital investments under the lease agreement and carried outin strict accordance of the project (construction of a building or structure,planting perennial crops, etc.). The restriction does not apply to illegalstructures, if the legislation does not provide other;

•tenant does actions of national strategic importance.

Ifnecessary, in some cases, it is allowed the allocation of equal-area plot to aprivate farm, from the lands of communal property of the correspondingadministrative division (article 12 of the land code of Ukraine).

Afterthe disengagement of the units and the allocation of the plot out of shares,the appropriate changes to the lease are made from the adjustment area ofsub-rented plot and cadastral maps.

Aboutchanges in the lease, it is reported to the tax office.

Article 9.Abolition/suspension of obligations the adoption of the Law of Ukraine "Onland turnover"

Forwork on delimitation of parcels of shares and transfer of part of the area inthe property, to abolish/suspend the obligation of adopting the Law "Onland turnover" as unnecessary and inhibiting factor of such an importantreform.

Article 10. Final provisions

1.This Law shall enter into force on the date of its publication.

2.Within two months from the date of entry into force of this Act, to provide:

a)for the Cabinet of Ministers of Ukraine, changes in Ukraine's legislation, alsoin the regulatory framework of the relevant structures.

b)for the Ministry of agrarian policy and food of Ukraine, development andapproval of instructions, with a detailed description of the activities tocarry out the relevant works.