Land legislation: large-scale developments due on 1 March 2015

15.01.2015

Legal update No 488

Goltsblat BLP advises that, on 1 March 2015, extensive amendments to the land legislation, introduced by Federal Law No. 171-FZ of 23 June 2014 “On Amending the Land Code of the Russian Federation and Certain Legislative Acts of the Russian Federation” (hereinafter FZ No. 171) will come into force. While most of the amendments pertain to public land (that is, land in state or municipal ownership), they will also indirectly impact on privately owned land plots.

Voluminous and rather comprehensive, FZ No. 171 amends not only the Land Code of the Russian Federation, but also the Civil Code and Urban Development Code, federal laws on the state real estate cadastre, state registration of real estate rights and transactions, agricultural land transactions and the subsoil, as well as many other legislative acts. To boot, it is quite a challenge to analyse and the logic behind many of its innovations is not quite clear.

The new legislation will definitely affect ongoing projects related, first of all, to acquisition of public land. We recommend focusing particularly on Article 34 of the Law, which contains transitional provisions. In particular, it sets out the rules to be followed if an authority vested with management of public land is changed or types of permitted use of land plots are adjusted in consideration of the Classifier approved by Order of the Russian Ministry for Economic Development No. 540 of 1 September 2014, and so on.

Note that regulations adopted at the level of the Russian Government and Ministry for Economic Development, as well as regulatory and legal acts of constituent entities of the Russian Federation, will be crucial for implementing FZ No. 171. Many of these may be expected to be adopted in the first six months of 2015.

During January and February 2015, we will update you on the legislative developments we believe to be most important; in particular, we will issue seven alerts on the following topics:

  • Changes in public ownership of land
  • Changes to the system for acquisition of rights to public land
  • Use of public land without land plot allocation or easement
  • Easements over public land plots
  • Allocation of land plots under the new legislation
  • New opportunities arising from land plot reconfiguration
  • Changes in regulations for using leased public land.

This alert focuses on changes in public ownership of land. To begin with, note that there has been no change to its fundamental structure: land remains in undelimited or delimited state ownership and no adjustments have been made to the grounds for delimitation.

A new Chapter V.5 will, however, be added to the Land Code of the Russian Federation (articles 39.30-39.32) setting out additional grounds for gratuitous transfer of federally-owned land plots to regional or municipal ownership. Municipalities and constituent entities can mainly expect to obtain federal land that is used ineffectively or land plots to which the Russian Federation obtained the title without good reason.

Substantial changes will be made regarding powers to manage land in undelimited state ownership, previously vested in municipalities. They will now be transferred to urban and rural settlements, provided that approved Land Use and Development Rules are available for such settlements (Article 3.3 of the Federal Law of 25 October 2001 “On Enactment of the Land Code of the Russian Federation”). Urban areas will continue managing land in undelimited state ownership located within their territory. Also, constituent entities will lose their right to pass laws authorising them to manage land within their administrative centres (capitals). Note, however, that, under Federal Laws No. 136-FZ of 27 May 2014 and No. 485-FZ of 29 December 2014, constituent entities pass their own laws redistributing powers, including pertaining to undelimited land management, among local and government authorities of the relevant constituent entity.

The Law addresses situations when acquisition of a land plot (for example, under preliminary approval for facility location or by auction) is launched before but completed after 1 March 2015. The basic principle is that the authority that commenced the procedure is to complete it. For example, if a preliminary approval for facility location is given by the municipality on 15 February 2015 but, from 1 March 2015, the land plot in question will, by virtue of law, be managed by the relevant urban settlement, the allocation decision will still rest with the municipality.

Also, as you might recall, a new concept has already been introduced providing for delegation of powers to manage land in undelimited state ownership to the Federal Agency for State Property Management (Rosimushchestvo)/Federal Housing Development Foundation (Article 3.4 of the Federal Law of 25 October 2001 “On Enactment of the Land Code of the Russian Federation”). The asserted goal of this move is to provide professional assistance to the municipalities, as the income from undelimited land management by the Federal Housing Development Foundation will still flow into the local budgets.

In a week, we will consider in more detail the key changes to the system for acquisition of rights to public land.

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For all issues related to publications, news and press releases, please contact:

Ksenia Soboleva

Head of PR and Communications

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