EU Project “Pravo-Justice” co-organized online consultations dedicated to eliminating the shortcomings of legal regulation regarding foreclosure of land plots

On September 16, 2022, supported by EU Project “Pravo-Justice”, online consultations were held, the topic being “Eliminating shortcomings of legal regulation regarding the foreclosure of land plots.” These consultations were conducted by the Ministry of Justice of Ukraine during monitoring how legislation is applied in the field of enforcement proceedings. The event was attended by representatives of the State Enforcement Service, SoE “SETAM” and SoE “Prozorro.Sales”, private enforcement officers, and notaries.

Online consultations started with welcome remarks by Oleksandr Oliinyk, Director of the Directorate of Justice and Criminal Justice, the Ministry of Justice of Ukraine. He noted how important it is for the regulator to hear about the challenges faced by participants in enforcement proceedings in practice and to work out ways to solve them together with professional community representatives.

“We are interested to hear about the challenges from a practical viewpoint - what enforcement officers and notaries face. It is just as important to hear what is suggested to solve this or that challenge. Your answers will form part of a conceptual study on further legislative amendments. It will be easier for us to explain to the Members of Parliament why we need to change this or that norm,” Oleksandr Oliinyk addressed the participants of the event.

Vitalii Chepurnyi, President of the Association of Private Enforcement Officers of Ukraine, delivered opening remarks. The President of the APEO said that the enforcement officers’ professional community initiated work on challenges related to land auctions in enforcement proceedings even before the first land auctions to sell seized land plots under the new rules started.

“This time, a little less than a year turned out to be more than enough to see the lay of the land and determine shortcomings. Most of them are legislation-related – they concern the Land Code, the Law “On Enforcement Proceedings”, the Law “On Mortgages” and others. Our key proposal is to provide an opportunity to sell the seized property for both SoE “Setam” and SoE “Prozorro.Sales”. The competition will only increase the quality of services.” That is the opinion of the enforcement officers’ professional community expressed by Vitalii Chepurnyi.

During the event, Katilin Popov, EU Project “Pravo-Justice” international expert stated that it is necessary to unify Ukrainian legislation governing foreclosure of land plots.

“In my opinion, the main problem is that norms of various legal acts governing the sale of land plots at electronic auctions are inconsistent. The Law “On Notaries”, the Land Code, the Law “On Enforcement Proceedings” and the Law “On Mortgages” contain norms setting forth various auction requirements and governing the procedure for selling land plots,” said Katilin Popov. According to the expert, the sale of debtors’ land plots should be regulated by a single legal act, then it will be a cohesive and understandable process, primarily for the user.

“Regardless of the object of the e-auction - movable or immovable property, the platform on which it is sold - SETAM or Prozorro, the procedure must be uniform and set forth in one legislative act, the Law “On Enforcement Proceedings”, for example,” said Katilin Popov and gave the example of Bulgaria, where almost all types of property are sold according to a single procedure. The exception is selling company shares.

“In such a case, the procedure is regulated by the legislation on corporate rights and shares are sold on the stock exchange,” Katilin Popov added.

Oksana Rusetska, a private enforcement officer of the enforcement district of the Dnipro region spoke about the challenges in preparing to sell land plots in enforcement proceedings.

“We need clear legislative rules so that neither the parties nor the participants in the enforcement proceedings have room for manipulation when selling the land,” said Oksana Rusetska.

Mykyta Bezmohorochnykh, private enforcement officer of the enforcement district of the Zaporizhzhia region, outlined three main shortcomings of the stages in which land auctions are conducted and formalizing their results. Valerii Prytuliak, his colleague from the enforcement district of the Odesa region, drew attention to even more nuances related to formalizing the results of land auctions during the enforcement proceedings.

Representatives of the notary community also spoke during online consultations. Halyna Parusova, member of the Commission for Analytical and Methodological Support of Notaries’ Activities, private notary of the Kyiv City Notary District and Inna Bernatska, Head of the Commission for Analytical and Methodical Support of Notaries’ Activities, private notary of the Ostroh Notary District of Rivne Region, spoke about the peculiarities of notaries’ work related to registering title of ownership to land plots.