Moscow region: amendments to the land legislation

17.01.2013

Legal Update No. 401, 17 January 2012

Goltsblat BLP advises of a number of changes to the Moscow Region’s land legislation adopted in late December 2012:

1. Moscow Region Law No. 218/2012-OZ of 26 December 2012 “On Amendments to the Moscow Region Law ‘On the Investment Policy Pursued by the Public Authorities of the Moscow Region’” and the Moscow Region Law “On Land Regulation in the Moscow Region” (which came into effect on 1 January 2013) establish that land plots in undelimited state ownership are to be let for construction on investment conditions with preliminary approval of the future facility’s location. These conditions include:

  • rental payable for the land plot to be determined on the basis of the market rental rates;
  • construction completion and finished facility commissioning times;
  • cost of construction, reconstruction or repair of the social, engineering and transport infrastructure, cost of other works, services and/or property to be transferred to state or municipal ownership.

The procedure for agreeing the investment conditions and exercising control over their fulfilment and also the procedure and conditions for paying the rental for use of land plots granted for construction on investment conditions are to be determined by the Moscow Region Government.

2. Moscow Region Law No. 203/2012-OZ dated 26 December 2012 (which came into effect on 29 December 2012) establishes the basic 2013 rental payable for land plots owned by the Moscow Region or in undelimited state ownership within the Moscow Region. The basic rental in Moscow Region municipalities has increased by an average of 10% over 2012.

In addition, Moscow Region Law No. 220/2012-OZ of 26 December 2012 “On Amendments to the Moscow Region Law ‘On Land Regulation in the Moscow Region’” (which came into effect on 29 December 2012) sets out that local government representative bodies may not establish rental adjustment factors of less than one. Previously, the minimum factor was 0.5. The factors applicable in consideration of the type of permitted land use in the residential construction sphere have also been increased, in particular for individual home construction (from 1.5 to 4.2) and comprehensive development for residential construction (from 1 to 4.2).

3. According to Moscow Region Law No. 219/2012-OZ of 26 December 2012 “On Amendments to the Moscow Region Law ‘On Land Regulation in the Moscow Region’” (effective from 29 December 2012), the powers of the government authorities to regulate certain land relations have been re-allocated. In particular, local government authorities of municipalities and urban districts have been granted the power to assign the category of agricultural land to land plots in undelimited state ownership (previously, this function was fulfilled by the Moscow Region Government).

The Moscow Region laws mentioned here obviously demonstrate a drive on the part of the Moscow Region authorities to boost budget revenues from use of state-owned land.

If you have any question or would like more detailed information, please contact: Vitaly Mozharowski, Partner, Real Estate & Construction, Goltsblat BLP, by phone +7 495 287 44 44, or by e-mail Vitaly.Mozharowski@gblplaw.com; or Yuri Chernobrivtsev, Partner, Real Estate & Construction, Goltsblat BLP, by phone +7 495 287 44 44, or by e-mail Yuri.Chernobrivtsev@gblplaw.com; or Maxim Popov, Associate Director, Real Estate & Construction, Goltsblat BLP, by phone +7 495 287 44 44, or by e-mail Maksim.Popov@gblplaw.com.

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