Ukrainian land reform at risk

Fields in the region of Odesa Photo: mramorn (cc) wikimedia.org

Land reform and the opening of the agricultural land market is a matter of pride for Volodymyr Zelenskyy, the president of Ukraine. At the last Ukraine-EU summit on October 6th, such achievements received a great amount of praise from European representatives. Meanwhile, a report by the Ukrainian investigative journalist Ihor Stakh contains information regarding corruption schemes in the State Service of Ukraine for Geodesy, Cartography and Cadastre (State GeoCadastre), a key institution related to the land market. We have decided to clear up the situation personally with Ihor Stakh.

MAXIM RUST: Did I understand correctly from your material that the State GeoCadastre, which is headed by Roman Leshchenko, is currently slowing down the implementation of land legislation in terms of opening the land market?

IGOR STAKH: At this point yes. As a condition for opening the land market there needs to be a complete inventory of agricultural land. At the moment only 0.12 hectares have been added to the inventory, which is five times less than in the previous year. The State Geocadastre failed to perform this task despite the fact that deadlines concerning the completion of the inventory were postponed by more than a month and a half.

Is this a matter of incompetence or corruption?

We in Ukraine, usually make fun of these situations. This is quite a competent and smart example of corruption. The thing is that the State Geocadastre is closely involved in various corrupt schemes related to access to land. In both a de jure and de facto sense private property often bypasses legislation related to the organisation.

Was there any private ownership of land in Ukraine before the Land Reform Law was adopted this year?

The ownership of land plots for individuals has existed in Ukraine for a long time, but it should be noted that it varies greatly for different categories of land plots. For the so-called ‘shares’, to which millions of Ukrainians are entitled, a moratorium has been operating for 20 years. This limits the rights of owners to sell their land freely, while, for example, “household plots” are free from such limitations.

So private ownership existed, but to a very limited extent and for certain categories. By the way, I pointed out in my material that Roman Leshchenko had paused the allocation of agricultural land to those categories of citizens who had the right to do so under the current legislation. As an explanation, an excuse was invented. This is namely that they took a ‘break’ until the system of land recording was cleared of corruption.

You wrote that as a result of this pause that the regional divisions of the State Geocadastre were now implementing a rather primitive corruption scheme. New orders on the allocation of land plots were being carried out using the “old” document numbers. Was that the purpose of the decision you had mentioned?

No, it is rather a side effect of corruption, when regional officials find a “loophole” to bypass the instructions of the central authority and continue their own corrupt activities. In this case, it is an official forgery, i.e. an outright crime.

What are the most popular schemes for obtaining land in private ownership?

The most common occurs through the use of morally dubious ‘straw men’, who receive a land plot as a ‘gift’. They then often change the designated legal purpose of the land from a “private peasant farm” to a “private household plot”, which can be freely sold under the current legislation. In this case, they use a legislative “loophole” that allows the ownership of land plots with the special purposes “for personal peasant farming” and “for a private household plot” to be quietly transferred to third parties. The moratorium does not affect either of these categories!

If the land is far from a settlement, it is easier to implement this scheme as I have described. If it is not far from the settlements, then it is more convenient to change its legal purpose and divide the lots into several smaller ones. To obtain more expensive land in nature reserves, corrupt officials often involve privileged groups like war veterans in their schemes. These people have the right to receive plots of 12 acres in these zones.

Here, the sale and purchase of the land takes the form of a loan from one private person to another, with a ‘pledge’ in the form of a land plot. It is clear that such schemes are possible only with the participation of officials from the State Geocadastre.

I would like to note that even if the prosecutor’s office shows interest in challenging these actions in court and returning the plots to state ownership, it is still extremely difficult to do so. This is because Ukrainian judicial practice tends to protect the rights of the buyer, rather than the state.

Large areas of land can be leased for up to 49 years. Here, the Geocadastre conducts an official auction of the land with only two participants. Of course, only one of the people genuinely wants to lease the land. It should be noted here that the circulation of newspapers where the conditions of these auctions are printed, including the date and place, consists of only a few copies. These always end up with “a lucky winner of the auction”. The auctions themselves are conducted rapidly, lasting up to ten minutes. As you can see yourself, the final price agreed in the auction exceeds the initial one by very little.

I can list you a few more equally popular corruption schemes, but I think the given examples are quite enough.

Do you think that President Zelenskyy consciously appointed a person with corrupt intentions to such an important post?

Currently, to the best of my knowledge, none of the investigative journalists I know have information as to the personal involvement of Zelenskyy in these schemes. They also do not know of any personal benefits Zelenskyy may have gained from the appointment of corrupt officials to key posts. But, nevertheless, I have certain doubts that the president is completely unaware of this situation. This is because these schemes are carried out in a very systematic manner.

The real problem is completely different. The president hasn’t got his own team, he actually has no criteria for the selection of staff. He has to follow the recommendations of his allies, who, in fact, are often involved in plans related to these corruption schemes.

Let’s look at Roman Leshchenko for example. He, as we say in such cases, was a “politician of a regional scale”, a deputy of the regional council in the Cherkasy region. Furthermore, during the presidential election campaign, he contributed a large amount of money (1.6 million Ukrainian hryvnia) to the funds of the “Servant of the People” party. This was around 64 thousand US dollars according to the exchange rate during the first half of 2019. After Zelenskyy’s victory he became the Presidential Commissioner for Land.

Roman Leshchenko played a very public role when the draft law on the opening of the land market was being reviewed by the parliament. Moreover, analysing his public statements, we can say that Mr. Leshchenko consistently defended the principles of the free purchase and sale of agricultural land. He even proposed more liberal approaches to the functioning of such a market than those adopted in law by the parliament’s deputies.

His appointment to a key post – the head of the State Geocadastre – was therefore somewhat logical.

However, you wrote that this appointment had been followed by a scandal…

Yes and the president should be very concerned. A competition to fill the position of the head of the State Geocadastre lacked transparency and all the required documents were completed retroactively. As a result, a person got a key post through a traditional corruption scheme, which, allegedly, had been left in the past by Zelenskyy’s government.

Well, today this person is becoming more and more of a problem for Volodymyr Zelenskyy. You can judge for yourself. Our president goes to the Ukraine-EU summit and discusses the ‘success’ of land reform, while his protégé slows down such reform and actively engages in acts of corruption.

Ihor Stakh is a Ukrainian journalist, blogger and author of numerous corruption investigations. In 2019, he was beaten several times by unknown persons for his activities. Currently, he resides outside Ukraine.

Maxim Rust is a political analyst and researcher of political elites in post-Soviet area. He has a PhD in political science from the University of Warsaw. He is also a contributing editor with New Eastern Europe.

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corruption, Ukraine, Ukraine reforms, Zelenskyy