Comprehensive Territory Development (CTD): Major Regulatory Changes

Legal Update No 827

Bryan Cave Leighton Paisner (formerly Goltsblat BLP in Russia) advises that Federal Law No. 494-FZ dated 30 December 2020 “Amending the Town-Planning Code and Certain Legislative Acts of the Russian Federation for Comprehensive Territory Development” (the “Law”) has come into force. Dubbed the “All-Russia Renovation Law”, it takes a different approach to CTD matters, expanding the opportunities in this sphere.

In line with new chapter 10 of the Russian Town-Planning Code, the Law now differentiates between the following four types of CTD:

  • Comprehensive greenfield development (previously known as integrated territory development),
  • Comprehensive residential area development  (previously, comprehensive brownfield development),
  • Comprehensive non-residential area development (previously, CTD initiated by local governments), and
  • CTD initiated by owners (the term has not changed).

Key novelties:

  • There are now many more possibilities for land and other real estate to be compulsorily purchased for state and municipal CTD project needs. Not only properties meeting the criteria set by the Russian Town-Planning Code, the Russian Government or Russian regions (unsafe dilapidated buildings, buildings to be demolished, etc.) may be so purchased, but also “normal” ones located within the same planning unit (neighbourhood, community or quarter) as the above buildings (articles 65 and 56.12 of the Russian Town-Planning and Land Codes, respectively).
  • CTD decisions and planning documents will now be of paramount importance and will prevail over higher-level town-planning documents. Specifically, such CTD decisions may still be made no matter how the territory is defined in the land use and development rules (part 5.2, article 30 of the Town-Planning Code), while these rules, together with the master plan, should then be aligned with the approved territory planning documents (part 2.1, article 24, part 3.4, article 33 and part 10.2, article 45 of the Town-Planning Code). This is a certain departure from the fundamentals of town-planning laws (article 2 of the Town-Planning Code), indicating that local communities are now less involved in town-planning activities.
  • Moreover, CTD decisions may now be made not only by local governments but also by the Russian government, the supreme executive bodies in Russian regions and legal entities nominated by them (article 66 of the Town-Planning Code). So it is presumably these bodies and entities that will play the key role in CTD projects.

Transitional provisions are regulated by article 18 of the Law: comprehensive and sustainable territory development contracts already in place will, generally, survive and be governed by the laws effective on their signing dates.

These new developments are clearly designed for CTD purposes, such as achieving performance goals, including housing construction and better housing targets, set by Presidential Decrees, national projects and government programmes (clause 2, part 1, article 64 of the Russian Town-Planning Code). One such target is to provide better housing for at least 5 m families a year and to increase housing construction to at least 120 m square metres by 2030 (clause 2, Presidential Decree No. 474 dated 21 July 2020 “Russian Federation National Development Goals until 2030”).  

So, when the Law is put into practice, we will see how often real estate owners’ rights and legitimate interests are breached and how administrative decisions promoting increased housing levels will, over time, impact on the social and economic development of territories and on comfortable living environments.

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