On August 13, 2019, the Law on Privatization of Non-Agricultural Land Plots (the “Law”) was adopted. An unofficial translation of the Law is available in English at the following link: https://kostalegal.com/publications/law-on-privatization-of-non-agricultural-land-plots. The Law will come into force on March 1, 2020.
The adoption of the Law is an initial point from where the land privatization reform starts. Continued state ownership of lands is subject to partial termination as the land privatization process mainly concerns non-agricultural land plots. As per the Article 8 of the Land Code, “agricultural land is land provided for agricultural needs or designated for such purposes. It includes irrigated and rain-fed lands, croplands, lands with hayfields, permanent grassland, permanent crops and vineyards.” Land plots that fall outside the definition provided will be within the scope of the Law.
Together with the Law, Presidential Decree No. UP – 5780 of August 13, 2019 (the “Decree”) was signed. Under this document, the Government clarified the reason of delayed effective date. As per the Decree, a legal experiment for testing the procedure of non-agricultural land privatization will be carried out in Syrdarya region of Uzbekistan before the Law enters into force. The experiment is aimed at identifying shortcomings and may help amend the Law. Moreover, the adoption of the Decree implies that the Law will be effective within the territory of Syrdarya region before it officially enters into force. By the end of September, corresponding legislative act will be signed for the experiment to start.
According to the Law, the regulation of land privatization is centered on the following government authorities:
“Land privatization” for the purposes of this Law is the transfer of land rights to private parties that are residents of the Republic of Uzbekistan. According to the Law, privatization is based on the principles of legality, voluntariness (privatization is carried out solely on a voluntary basis), a fee-based principle, the unity of privatized land plots and immovable property located on them as well as the principles of openness and transparency (free access to all information concerning privatization).
As per the wording of the Law, residents of the Republic of Uzbekistan, both individuals and legal entities are eligible to privatize land plots. Non-residents and stateless persons are not regarded as subjects of the Law and, as a result, not allowed to privatize land plots. Stateless persons and non-residents are not entitled to acquire privatized land plots unless otherwise provided by the Land Code and/or international agreements of the Republic of Uzbekistan.
The Law explicitly lists the types of land plots that are subject to privatization. Similarly, the Law also indicates the list of land plots that are not targeted for privatization. (Please see Table 1)
Table 1. Land plots subject to privatization
As the Law provides, resident legal entities are allowed to privatize land plots on which the buildings, structures and industrial infrastructure facilities belonging to legal entities are located, as well as the land adjacent to them to the extent necessary to carry out production activities. Whereas citizens are allowed to privatize land plots provided to them for individual housing construction and maintenance of a residential house.
In the cases of share or joint ownership of real estate, the land privatization shall be agreed upon by all owners. Failing this, the land privatization shall be carried in accordance with the court decision.
The Law has clearly divided the land plots subject to privatization into 2 categories: land plots with immovable property and vacant land plots. Consequently, the Law envisages two procedures for land plots privatization. Privatization of land plots with immovable property is carried out through buyout. Vacant land plots are privatized through e-auctions. (Please see Table 2)
It is to note that the Law foresees the adoption of the Regulation on the Provision of State Services on Land Privatization by the Cabinet of Ministers. Such Regulation shall establish more clarified privatization procedures and, among other things, may provide for applications of standard forms.
Table 2. The procedures for land plots privatization
Pursuant to the Law, an applicant may be denied the right to privatize the land plots only in the following cases:
Unsatisfied applicant has a right to appeal to the Administrative Court against decisions taken by the Commission.
As the Law stipulates, the privatized land plots gain a status of a private property and become objects of civil circulation. The owners of the privatized land plots receive legal protection of their private property and an obligation to respect others’ private property – others' privatized land plots.
The Law allows for the seizure of privatized land plot only in the following cases: