Ukraine farmland market draft law published by ministry

The Ministry of Economic Development, Trade and
Agriculture published on Sept. 20 a draft law on the conditions for launching
Ukraine’s farmland market. Among its key conditions are (1) canceling the
farmland trade moratorium in October 2020, (2) limiting trade to Ukrainian
citizens and legal entities registered in Ukraine, (3) selling state-owned
farmland through auctions, (4) current tenants having a preferred right to
purchase their rented farmland, and (5) restricting land ownership by one
entity to no more than 15% of farmland in a particular region/oblast and no
more than 0.5% of total farmland in Ukraine.

Andriy Perederey: The moratorium cancellation and farmland market opening will be
positive for Ukraine’s economy and investment climate. International investors
will be able to buy and own farmland through Ukraine-registered legal entities.
Also, we see that many large agricultural holdings will not be able to buy the
land they currently operate in their possession due to the proposed size caps.
The 0.5% restriction of farmland concentration means one entity (including
related parties) won’t be able to possess more than 153,000 ha of farmland, we
calculate. Companies like Kernel (KER PW) and Ukrlandfarming (UKRLAN), which
operate over 500,000 ha; MHP (MHPC LI, MHPSA), which operates about 370,000 ha;
and Astarta (AST PW), which operates about 280,000 ha, won’t have even the theoretical
ability to possess the land bank they currently operate.