On 22 November 2017, the Cabinet of Ministers of Ukraine approved Resolution No. 890 On Introduction of Amendments into Certain Resolutions of the Cabinet of Ministers of Ukraine (hereinafter referred to as Resolution No. 890), whereby amendments were introduced into the Model Land Lease Agreement, approved by Resolution of the Cabinet of Ministers of Ukraine, dated 3 March 2004, No. 220; such amendments were aimed at improving the management tools applied with respect to utilization and conservation of lands, preservation and renewal of subsoil fertility.

The approved amendments provide for the following:

  • Determination in the lease agreement of quality characteristics pertaining to the subsoil layer of a land plot as of the moment of commencement of lease of such land plot
  • Reimbursement to the landlord (owner of land plot) of losses incurred as a result of deterioration of quality of the subsoil layer of the leased land plot or bringing a land plot into a condition unsuitable for its further utilization in compliance with its designation
  • Determination of a time limit for effecting a lease payment due for utilization of a land plot and enhancement of liability in the instances of failure to effect such lease payments on a timely basis (penalty, fine).

The aforesaid mechanism for assessing the quality characteristics of the land plot’s subsoil layer is to be introduced as a result of agrochemical classification of the land plots’ subsoil layers, with issuance of respective agrochemical passports. At the current stage, production of such passport costs, approximately, UAH 1,500.00 per land plot, and it may be issued within two weeks.

The issuance of a passport for the land plot shall be mandatory in the instances of commencement of lease of the state-owned land or municipal lands and is recommended for private lands.

In addition to the above, in the instances of commencement of lease of the land plots intended for production of agricultural goods, farming business and land plots (with agricultural designation) of private agricultural households that are located on the reclaimed lands as well as on those lands, on which hydrotechnical reclamation works are performed, the land tenant shall also assume the following obligation: to make investments into the development and improvement of the respective reclamation systems, including facilities related to the engineering infrastructure, and to render assistance in connection with their proper operation; nevertheless, no fixed amount of such investment to be made, has been determined so far.

It should be pointed out that Resolution No. 890 has not yet entered into full force and effect.