On November 25, 2014 the Law of Ukraine "On Amendments to Some Legislative Acts of Ukraine on De- termining Ultimate Beneficiaries of Legal Entities and Public Figures" (hereinafter, the Law)1 shall come into effect.
The Law provides inter alia for the repeatedly discussed and the long-awaited opening of the register of real rights to immovable property and their encumbrances (hereinafter, the State Register of Rights). Thus, Article 28 of the Law of Ukraine "On State Registration of Real Rights to Immovable Property and their Encumbrances"2 is laid out in a new wording. According to it, information about registered rights and their encumbrances contained in the State Register of Rights shall be open and public.
Furthermore, legal entities and individuals may obtain information from the State Register of Rights exclu- sively regarding the property they are interested in (i.e. information about all registered rights to real estate of a particular subject will still be closed)
The Law stipulates that individuals and legal entities may obtain information in the following ways:
- In electronic form through the Website of the Ukrainian State Register;
- In paper form by submitting an application in person to authorities in charge of the state registration of rights and to notaries;
- In paper form by sending a postal item to authorities in charge of the state registration of rights and to notaries.
As for officials of state authorities, local self-governments, courts, enforcement offices, prosecutors’ offices, the Security Service of Ukraine, notaries who obtain information from the State Register of Rights due to the exercise of their powers defined by law, information shall be provided to such applicants both regarding the real estate object and the real right subject, in electronic form by means of direct access to the State Register of Rights, provided that the relevant official is identified by using his/her digital signature.
In this case, information about the registered rights and encumbrances obtain in electronic or paper form with the help of software for maintaining the State Register of Rights, is official and is used in accordance with the help with the law.
In turn, the owner or other rights holder can obtain information about persons who have obtained informa- tion about the registered rights and encumbrances on the real property that belongs to him in the form of an extract from the State Register of Rights.
The procedure for obtaining information will be determined in more detail by the Cabinet of Ministers of Ukraine. At the same time, the transitional provisions of the Law set a period of three months from the date of entry into force of the Law for the Cabinet of Ministers of Ukraine to bring its regulations in compliance with the Law.
Free access to State Register of Rights will undoubtedly have a positive impact on the investment attractiveness of the Ukrainian real estate market, as any investor will be able to obtain information about the actual owner of a potential investment object and the encumbrances of real rights thereto. Besides, if the progressive rule prescribed by the Law regarding the possibility to obtain information online is implemented in practice, access to the data contained in the Register will be actually unobstructed due to avoiding the bureaucratic element.
At the same time, it should be noted that information contained in the State Register of Rights is limited only to the rights and encumbrances registered after January 1, 2013 due to the initial registration of rights or a notarial transaction (as we know, information from the registers that existed before 2013 was not trans- ferred to the State Register of Rights automatically and appeared there only at the relevant entity’s request). In this context we should also mention the transfer of data from the State Land Cadaster to the State Register of Rights as announced by the Government. Thus, till the end of the current year information about 1.5 mil- lions of land plots registered with the State Land Register before January 1, 2013 is going to be automatically transferred to the State Register of Rights. Therefore, is the announced data transfer takes place, individuals and legal entities will have access to information about real rights to land plots registered before 2013 as well. Meanwhile, the opening of data in the actually unfilled State Register of Rights will hardly bring the antici- Meanwhile, the opening of data in the actually unfilled State Register of Rights will hardly pated effect, while the advantages of open access will be available only in the distant future.