Land market and village investment get powerful legislative impetus
On October 25, Verkhovna Rada debated in the second reading the Land Code bill in a more than tense atmosphere. In protest against adoption of this so-called agrarian constitution (apparently aware that not only the popular but also the electoral ground is slipping out from under their feet), twenty or so Communists, quite in the spirit of historical experience, blocked all access to the rostrum at the beginning of the morning session. They showed such a decisive approach to the lawmaking process with well-known slogans affixed, for more emphasis, on the wall behind the dais: “Selling land means selling Fatherland!,” “Let us save our native land, our people’s holy of holies!,” “The people say, the wise trade in goods, the simple in raw materials, and fools in land.”
It goes without saying that this position of the Left led to a direct confrontation. Most parliamentary factions have long understood that the agrarian constitution should be adopted. “The Land Code is full of compromises. No other document has been drawn up so carefully,” Kateryna Vashchuk, chairperson of Verkhovna Rada’s Agrarian Reform Committee, told The Day.
In the case of the Communists, no compromise was reached. This triggered a lengthy debate more resembling a tribal powwow than a European parliament session. It was a foregone conclusion that the numerous attempts of First Vice Speaker Viktor Medvedchuk (who kept calm throughout the unseemly session) to enter into a civilized debate with the Communist were doomed to failure. Then the first vice speaker took a tough stand, “The rules of this body require that the Land Code be voted upon, even article by article, if need be.”
Without taking the trouble of doing a complex economic and legal analysis, deputies from the Communist and other Left factions immediately leveled criticism at both the law articles and the approved procedure. “The procedure is invalid... The Land Code first-reading voting results have been rigged... The code itself was written for the latifundia,” the Communists and Socialists kept saying in their speeches.
“The document to be voted upon envisions the preservation of all forms of land ownership and leasing... The purchase and sales of land will be banned for five years, it is not allowed to sell plots of more than 100 hectares for 10 years. There is a ban on selling land to foreigners. We suggest establishing a specialized Land Bank within the next five years to register and appraise land before the provision on purchase and sale comes into force,” Ms. Vashchuk tried to respond to the Left’s accusations, still unable to mount the rostrum. Her explanations were repeatedly interrupted by the continuous ringing of the Communists who managed to break through onto the dais.
Ms. Vashchuk never succeeded in bringing the Land Code to a vote. Calling on the Communists to show wisdom and perhaps being aware that it was impossible to vote according to the usual procedure, Mr. Medvedchuk suggested that she read the code article by article, without mounting the rostrum. Faced with this turn of events, the Communist women deputies immediately attacked Ms. Vashchuk, and the first vice speaker had to announce a half-hour break, asking faction leaders to hold talks.
Summing up the latter, Mr. Medvedchuk said, “We will only find the way out by means of voting, whatever it is... If I am not allowed to put (the Land Code) to a vote from the dais, I will do so from some other place, even from the third floor,” he said. Then he suggested that Ms. Vashchuk read out the committee conclusions and bring the Land Code as a whole to a vote. As was to be expected, she failed to do so. Yet, after resting during the break, the Communists opted for an acoustic attack on Ms. Vashchuk, a method of struggle more civilized than manhandling.
The most militant, in obvious euphoria from the screams of their comrades, snatched the microphone from Medvedchuk and, when the first vice speaker gestured to the deputies to vote, broke the Rada electronic vote-counting system. The only way out of the predicament was a vote by a show of cards, as a result of which the Verkhovna Rada voting commission ruled that the Land Code had been adopted as a whole in the second reading, Commission Chairman and First Deputy Chairman of the Rules Committee Volodymyr Zayets (SDPU{o} fraction) announced on the evening of October 25. In his words, out of the 240 registered deputies, 232 (six more than needed) voted for passage, 2 against, no abstentions, and 6 ballots being found invalid.
Mr. Zayets also gave a preliminary number of the ballot cards taken by factions and groups for voting this agrarian constitution (in other words, the share of participation in voting). It turned out that 12 ballots had been issued to the Popular Movement of Ukraine faction, 45 to the Labor Ukraine group, 18 to the Democratic Union faction, 14 to the Reforms Congress faction, 21 to the Ukrainian Popular Movement, 16 to the Green Party faction, 20 to the Regions of Ukraine group, 14 to the NDP faction, 36 to the SDPU(o) faction, 21 to the Solidarity group, and 1 to the Fatherland faction. The Yabluko (Apple) faction received 3 ballots later found invalid.
Addressing the opening session of the International Economic Forum for Cross-Border Cooperation in Lviv, Prime Minister Anatoly Kinakh of Ukraine welcomed the passage of the Land Code. He noted that implementation of the law “will allow not only carrying out a more radical market-oriented agrarian reform but also establishing the institutions of efficient owners, creating investment- friendly conditions, and increasing the competitiveness of the Ukrainian economy as a whole.” He said this was achieved “thanks to years of effort by the Ukrainian people and state,” Interfax-Ukraine reports.
The Left factions of the Ukrainian parliament view adoption of the Land Code in a completely different light. Last Friday, during the morning session of Verkhovna Rada, Communist Party (KPU) faction members walked out in protest against what they called Land Code vote fixing. Volodymyr Matveyev, a KPU fraction member, emphasized that the Communist deputies would walk out until this matter is investigated. Perhaps they forgot the reason why this document had not been voted on in the session room the night before.
The Socialists explained their stand in a more traditional way: they claim the very process of voting was falsified. Member of the vote counting commission, People’s Deputy Stanislav Nikolayenko (Left Center fraction), asked in his speech to put the Land Code to a repeated vote. “Yesterday (on Thursday — Author) one could get a stack of ballots for all faction members, irrespective of where they were at the moment,” he claimed. “Somebody wants to push through the Land Code,” he claimed.
To tell the truth, one does not need to look for any mysterious somebody. Quite recently, Ukrainian farmers picketed Verkhovna Rada in broad daylight. The parliamentary majority has also insisted on passing the Land Code. In other words, the necessity of adopting, to quote Minister of Agrarian Policies Ivan Kyrylenko, the “fateful document” and establishing the private ownership of land has been shared by all those who favor a legal, not shadow, land market and the attraction of investment in agriculture.
Obviously, the Left is worried about the likely “piratical privatization” of land. Yet, as People’s Deputy Hennady Udovenko told The Day, “They should read the law more closely.” It will be recalled that the Land Code declares a five-year moratorium on the purchase and sale of any land. In the period of 2005 through 2010, an individual will be allowed to sell not more than 100 hectares of arable land. The code also sets out that no agricultural land can be transferred (in any case, before a proper decision has been made) as property to foreign citizens, persons without citizenship, and foreign legal entities and states. “Should such an operation be carried out, the land can be confiscated,” Ms. Vashchuk explained to The Day.
In addition, the right to buy land for commercial farming belongs only to those citizens of Ukraine who have an agricultural education, experience of work in the agrarian sector, and legal entities whose foundation documents envisage commercial agriculture. It will be noted that natural and corporate persons, as well as territorial communities and the state, enjoy the right to acquire land plots on the basis of exchange, donation, inheritance, and other civil law relationships.
Under the Land Code, “central and local government bodies shall effect the sales of land plots in state communal ownership to natural and corporate persons who have the right to acquire land plots as property.” Moreover, Ms. Vashchuk told The Day, “Before the land purchase and sale clause comes into force, we suggest setting up a Land Bank to register and appraise the land.” In her opinion, this will preclude land from being sold for a song.
The Left also want this. But the point is that this way of the legislative confirmation of economic realities seems not only to be running counter to the Communists’ and Socialists’ ideology but also tearing them off the, so to speak, “electoral ground.” As Hennady Kriuchkov, a KPU faction member, said on October 26, the Communist Party is appealing to the Constitutional Court to have the passage of the Land Code revoked. As it became known, the Communists have even drawn up a document to submit to the CC. As Mr. Zayets rightly noted, the Communist deputies’ behavior, documented in the session record, considerably diminishes the chances of the Left to win any such suit.
COMMENTS
Leonid KOZACHENKO, Vice Prime Minister of Ukraine for Agrarian Policies:
“It should be noted that the adopted Land Code is far from being perfect and requires further improvement. It is no secret that in most civilized countries analogous documents consist of hundreds of pages. Yet, it was necessary that Verkhovna Rada adopt it because the very process of agrarian reform has to be legally spelled out. Now one can work actively not only to reform the legislation. The adoption of the Land Code enables agricultural businesses to receive long- term and intermediate credit, as well as to solve social problems more effectively. However, some provisions need basic modification, which is not a one-day affair. In my opinion, the most important of these are introduction of a governmental land cadaster, differentiation between land in state and communal ownership, mortgage loans using land as collateral, the improvement of real estate (including land) registration, land payment system, etc.”
Ivan TOMYCH, President, Association of Ukrainian Farmers:
“I approve the adoption of the Land Code. On October 25, farmers received about 615,000 hectares of arable land in private ownership free of charge. Besides, this document is a new step in promoting the idea of private property in this country. Still, we feel no euphoria over it. No drastic changes have occurred. Only five years from now will farmers have an opportunity to freely buy and sell land. There are so far no ample grounds to say that the investment climate in agriculture has improved substantially. For this to happen, a number of other laws have to be passed, for example, on mortgage, on the land bank, etc. What also needs adoption is a clear-cut and transparent procedure of land dispossession by a creditor in case of debt default. Nonetheless, we are very grateful to the people’s deputies who voted for the Land Code.”
