VII Business & Legal Real Estate Forum (Oct 2, 2024)

Organizer: Legal Practice Publishing House

Topics Covered: Financing of construction projects, trends in real estate, shifts in real estate during the war, European integration and urban planning, prospects after the war, protective structures.

Agenda:

Session 1

CONSTRUCTION AND REAL ESTATE MARKET: WARTIME CORRECTIONS

Moderator: Ernest HRAMATSKY, President of AF "Hramatsky and Partners"

Session 2

REAL ESTATE TRANSACTIONS

Moderator: Roman TITIKALO, MORIS partner

Session 3

JUDICIAL CONTROL

Moderator: Yurii KHAPKO, managing partner of Totum, lawyer, Doctor of Law.

Transcript:

Part 1

Ernest Gramatskiy Without further ado, I would like to congratulate all of you, all of us, with the seventh annual Business and Legal Real Estate Forum 2024.

Ernest Gramatskiy I would like to give a warm welcome to our second member of the forum, a symbol of legislative reforms in the construction sector, Mrs. Olena Shulyak. You don't need to introduce Ms. Olena, but according to the implementation of the regulations, I will say that Ms. Olena Shulyak is the head of the party Sluha Norodu.

Ernest Gramatskiy the head of the Committee of the Verkhovna Rada on the Organization of State Power, Local Self-Governing, Regional Intelligence and City Construction, the head of the Coordination Council on the Solution of Problems in the Sphere of City Construction under the Presidents of Ukraine. And if you remember all the forums, all the forums, all the regalia of Mrs. Olena, then we will not have enough time, but we need to understand that all state initiatives on the issue of city construction, inclusivity, intelligence, business,

Ernest Gramatskiy business communities, the international arena. We see the powerful activity of Mrs. Olena everywhere. Tell me, please, how do you do it in general?

Olena Shulyak

Good afternoon, dear colleagues. I work at the NKVD. Good afternoon. Good afternoon, dear colleagues.

Olena Shulyak  I am not a lawyer by education, it is very difficult for me to communicate with lawyers in your professional language.

Olena Shulyak But I am definitely a fan of the construction market. And no matter what positions you have today, tomorrow or the day after tomorrow, the main thing you can do for the construction market to become modern, to become innovative, without corruption. And I think that now, when we are fighting for our right to democracy, and in general Ukraine is fighting for its European future, well, the construction market should definitely

Olena Shulyak to the new rules and standards, and we can do it all together with you. So thank you very much for the invitation. I would be very glad if we had not only my monologue, but also questions, wishes, criticism. I know that not all things are liked in the implementation of what the legislators accept.

Olena Shulyak But we are doing our best, we sometimes even make changes, if necessary, to the corresponding laws, so that it would be easier to use the mechanisms that we introduce. Thank you very much.

Ernest Gramatskiy Ms. Olena, the first topic is such a sudden renewal, terrible losses, we see these figures, we see

Ernest Gramatskiy A quick assessment of the damage of RDNA-3 is 480 billion rubles, and this is only the 23rd year. We see a school of economics with a loss of 160 billion rubles for reconstruction. Of course, the environment, the economy, the infrastructure, the demarcation of refugees, and so on. We cannot bypass the issue of restoration.

Ernest Gramatskiy We see that there was a proposed draft law on the principles of the restoration of Ukraine. There are some mechanisms of priority and so on. What about this draft law? There was a moment when a lot of people talked about it on the forums and so on. Now they have calmed down a little. Is there a prospect in it? Is it necessary? What about it?

Olena Shulyak In 2023,

This organization was created under the Ministry of Renewal of the Working Group, which included representatives of various ministries, representatives of the expert environment, representatives of various anti-corruption public organizations.

Olena Shulyak according to the legislative framework, about the basic principles of renewal. In May, this bill was published on the Ministry website for public discussions, but the dismissal of the entire team of Mr. Oleksandr Kubrakov took place. And you remember, our ministry was without a head for more than four months. Therefore, the bill was a bit

Olena Shulyak without supervision, I would say. We did not stop in the committee. Together with our international partners, with one of the USAID projects, we conducted public consultations. It seems to me that these were one of the largest public consultations, because about a thousand people joined, various experts, various representatives of communities, representatives of internally displaced people, representatives of the veteran community and those who have

Olena Shulyak The property moved from temporarily occupied territories. And we actively discussed what needs to be added to this bill so that it becomes an effective mechanism, an effective law. And now we are working on this report, and there is already a new head of the ministry. We will direct all these materials directly to the Ministry of Renewal. And I hope we will continue cooperation, because there are many things that need to be regulated at the level of legislation.

Olena Shulyak Of course, there are general things in this law, for example, about the principles of renewal. We have separated 14 basic principles. Well, now we really wanted all these principles related to permanent development, circular economy, green transition to be fixed necessarily at the level of the law.

Olena Shulyak But there are also very important things in the draft law, for example, how to renew the settlements, not even how to renew them physically, but how to make a decision. Who will make a decision that settlements should not be renewed, or vice versa, under what criteria?

Olena Shulyak How will the cooperation between the central executive body, local self-government, restoration agencies, etc. be? And all these things really need to be regulated. And, of course, you remember, I think everyone here knows about the digital ecosystem.

Olena Shulyak Our international partners are actively supporting us. Today, this system works in such an experimental order. The experimental order ends in November, as far as I remember. And we would like to reinforce at the regulatory level that DREAM is used by everyone, and municipalities.

Olena Shulyak and the Ministry, and the Restoration Agency, and our international projects, and partners when they give the appropriate funding, because this principle, which is embedded in the basic system, which we call everyone sees everything, it must be based on reconstruction. When we say that the reconstruction must be transparent, transparent, everything can be done directly by Dream itself. Therefore, we hope that work will be more active now,

Olena Shulyak You know that the decision is now in the Parliament, and the position with the government must be consolidated. If, for example, the Ministry of the Interior or the Parliamentary Committee cannot make such a decision, I think that here we will definitely find consensus for this work to be continued. So join us, all the information is on the Ministry website.

Ernest Gramatskiy This information is relevant to us, and if someone needs a proposal for this legislative framework, we will take it into account. Thank you very much. So, this is a legal project. First there was the PAST Recovery program, then the General Plan for Renewal until 2032. We see that a lot of agencies are working on renewal, of course. At the international level, we see the same situation.

Ernest Gramatskiy And we would like to start this forum with a short interview, I would say, on the projects of various, and all of them, as a matter of fact, are together, whether this law, and within the framework of this law, will already be written in this way.

Olena Shulyak Of course, we wanted the basic principles and approaches to be recorded in the legislative framework. You just mentioned how the first, I think, was called the Fast Recovery Plan. They took a table in Excel, made it, showed how many square meters were destroyed, multiplied by dollars, received 17 billion, went to international partners and said, look, we have 17 billion dollars here, give us money.

Olena Shulyak The judges looked at us with big eyes and said, of course, you are great, but there must be some approaches. Why did you calculate so? Why with such prices? What are the priorities? Do we need to renew it with the calculation of the events that brought us, unfortunately, a large-scale upheaval?

Olena Shulyak So my personal opinion is that we need to start with a framework legislation that clearly defines the approaches. Secondly, I am a fan of planning, because I believe that our communities can be successful when there is planning. Unfortunately, today we see how people are formed.

Olena Shulyak The main criterion is that if there is a project cost-benefit documentation, then it is normal to write down the renewal plan. This can happen. We are trying to inform our heads of the committee and the local self-government that it is necessary to pass the renewal plan.

Olena Shulyak to carry out the appropriate planning procedure. Of course, if you can't develop a modern development strategy, you can't, for example, make other strategic documents, anyway, at the level of legislation, we have provided a very simple document, but it is extremely important. It is called the program of comprehensive renewal. Before the community forms a list of its objects

Olena Shulyak should do the homework. The homework is to analyze the economic situation and what is happening in the community.

Olena Shulyak What can the community offer to the new business? Is it an industrial park? Are there any raw materials that can be used potentially? Is it a transport or logistics unit that can be developed? But look at your community and not all economic opportunities.

Olena Shulyak The second factor is the demographic. We talk about it a lot, we do not talk much. People, in order for people to come back, they must clearly understand where they will work, where they will have infrastructure, where the children will go to school, etc. Therefore, with the consideration of the demographic, it is necessary to plan such a renewal.

Olena Shulyak Of course, all the ecological issues, all the issues related to deforestation, all the issues related to construction waste, all this needs to be taken into account when planning a renovation. And, of course, the loading and, in general, the review of the public service networks. We know that even these communities

Olena Shulyak which were not in the occupation, but the population has grown in them. Already today, it can add up to 25-30 percent, because people have moved in. These people have come, the network of educational institutions, health care institutions is not working, and it is necessary to review in general

Olena Shulyak and create new requirements for it. Therefore, I repeat, through such programs of comprehensive renewal, it is necessary, through such planning documents, to approach directly to when the list of projects is formed, which are then put into the DREAM system and shown to our international partners. Now, please, let's help us finance it.

Ernest Gramatskiy The question of currency or money, of course, because no one will rebuild anything without money. Last year we said that there are three main sources of money. International aid, investment funds, confiscated Russian property. What is the relationship now and what money do we hope for more?

Olena Shulyak At the moment, the Parliament is in the process of considering the budget. Yesterday was the last day when we submitted amendments to the state budget for the 25th year. Terrible expenses in terms of defense. If in 2024 they were provided at the level of 1.6 trillion hryvnias, then by 2025 it will be 2.223.

Olena Shulyak And I think it can be such an unending thing. No country in the world, no country that is part of the NATO alliance, does not spend such money. Of course, we are going through a great war.

Olena Shulyak But the budget of the 25th year is the defense budget, not the development budget. Of course, there will be a victory, and then there will be a development budget. We cannot afford to renew some things now.

Olena Shulyak said about the report of the World Bank R\u0026D A3. It was formed in the 23rd year in December and presented in the 24th in February. This is just before these crazy shelling of our energy system. I think that when the fourth report will be made, this amount of 486 billion dollars, it will be much larger, because the indicators related to the energy system will also be included. Of course, in the first place is defense.

Olena Shulyak Secondly, we cannot ignore all our social issues, we cannot ignore the challenges that we face in order to finance the pension system. But we must not forget about the issue of renewal. Where to get the money? It is very good that Ukraine Facility is working with us. You know that by 2027 we will receive 50 billion euros.

Olena Shulyak as a country, and moreover, this money will go directly to the budget and will finance such a social and humanitarian sphere. But from this money, 16 billion euros will be formed in the form of such an investment fund, which will be joined by EBRD, the World Bank, the European Investment Bank, various other international financial institutions,

Olena Shulyak in order to finance projects that are primarily related to business development. Well, business is developing, of course, renewal is also developing. According to Ukraine Facility, 1 billion euros by 2027 should be received by our communities directly,

Olena Shulyak And now we are working with the communities, we say, please, plan first through the complex recovery program, then prepare projects, summaries, so that you are ready if money comes to you, so that you do not split your hands or give some old projects that you will add to the full-scale investment. Well, of course, now we have a lot of

Olena Shulyak We are counting on that money. You remember, on September 20, Ursula von der Leyen announced that Ukraine will receive 35 billion euros by the end of the year. This is precisely this scheme with the income of frozen Russian assets. And I am sure that a significant part of this money will go to defense, but there will be a part of the money that will be used to finance issues related to recovery.

Olena Shulyak And let's not forget, for example, the portfolio of various reconstruction projects, which were carried out by the team of Oleksandr Kubrakov. I know this figure for sure. He made about 5 billion euros. This is not money from the state budget. These are dozens of projects, which were financed by partners, by agreements with the team of the Ministry. Well, I would really like the new head of the Ministry to develop these projects as well, to have agreements with international partners,

Olena Shulyak so that they would trust and give this money to various projects. Of course, these are infrastructure projects in the first place, of course, these are projects that are related, well, for example, there was a huge project related to the construction of waterways in the Dnipropetrovsk region. Now we also have a question of providing the city of Mykolayiv with water. Of course, these are projects that are related, and they must continue to protect our energy infrastructure, because the enemy will definitely not go anywhere,

Olena Shulyak We need to have reliable protection so that we don't fall into some kind of a blackout because someone didn't do something.

Ernest Gramatskiy Do you remember, we talked about the concept when each country took control of some region, and there was such a map of Ukraine, and then there was England, France, Estonia, I remember Denmark with the Mykolaiv region, and so on. Is this a project now, is this concept being implemented further?

Olena Shulyak As far as I know, Danya continues to take very active care of Mykolaiv region. They are in constant contact with the head of the military administration, with the mayor of the city, and they finance various programs to help Mykolaiv region develop. I know that France is now helping both communities and, directly,

Olena Shulyak to the city of Chernihiv, for example, they are involved in the planning documents, and, for example, the destroyed theater in the city of Chernihiv, where there was an invasion, when there was this drone exhibition, you remember, France also takes on its responsibilities and they help. In Zhytomyr region, which began to actively cooperate with the Estonian government, and has already joined, it seems to me, the government

Olena Shulyak in Portugal, in order to help those affected communities, which had the most damage from the invasion of the Russian occupiers, they also work. Of course, this money is not enough, but, directly, every country that takes the responsibility is extremely grateful for the fact that, little by little, everyone, as much as possible, can help and give. All the same, this is reflected in the development of our communities.

Ernest Gramatskiy Standards. You say that when we renew everything, and now we are renewing something, well, when it is massive, then it is necessary to adhere to international European standards and it is better to build a normal one right away. On the other hand, we understand that it must be either fast or comfortable and correct according to the standards,

Ernest Gramatskiy And this will somehow affect the price. And quality, price or speed. How to find this balance. Because if it is according to the standards, it will definitely not be very cheap. On the other hand, the investor says that he is ready to invest money, but he wants to build as much housing as possible for people and get some money and so on. But then there will be no standards.

Olena Shulyak Your question reminds me of the summer of 2022. I am in Irpin. We are standing near a destroyed apartment building with the mayor of the city. Not destroyed, but damaged. And the mayor says to me, look, what to do? I have so much money there.

Olena Shulyak I can repair 5 such houses, and according to the new rules and standards, including, first of all, energy efficiency standards, I can repair 2. What to do? There is no money, people need to live somewhere, what to do? Well, I have only one answer, of course, to use new standards, because if we don't do it now,

Olena Shulyak like these wagons that are not given to us for temporary residence and say that it is temporary, and then it can temporarily turn into such a long-term period, and we would really, really not want that. The Verkhovna Rada has already, during a full-scale intervention, approved legislation, which I think is very important, it concerns issues related to energy efficiency.

Olena Shulyak This legislation establishes new requirements for the construction of facilities in accordance with these new standards.

Olena Shulyak energy efficiency, energy independence. This is a question of our safety now, and we will definitely not be able to allow ourselves to heat up the air endlessly, open the windows in winter, because there is heat in the house or something else, we will approach these things a little differently. Therefore, of course, to plan and build according to new standards, we, by the way, have another standard, which in Europe

Olena Shulyak and is not used in other countries. Unfortunately, we will use it all the time, and it is very expensive. These are safety standards.

Olena Shulyak We now have a new system of civil protection. We build shelters in our schools, we design double-deck buildings, for example, so that you can use the same parking lot as a bomb shelter, as a shelter in residential buildings.

Olena Shulyak There are many different ideas from our representatives of the public sector. They say, you are doing everything wrong. Russia will see where you are building these shelters, what kind of parking lots you are building. Everyone needs to make an individual concrete capsule. All of them need to be disassembled. There are many different great examples, but Russia sees everything anyway.

Olena Shulyak according to such standards, in order to be as safe as possible from the type of equipment that Russia uses on the territory of Ukraine. Of course, we will do and talk a lot about, we would like to talk less, do more in the field of green restoration, because green restoration and ecology, when we come to our partners,

Olena Shulyak Europe, they begin to tell us where they are already in development, at what stage, and we hear about all the climatic changes, what they are doing, what are the new approaches, standards, and so on. And here, I say, look, we are still at the lowest level, we do not know how to conduct

Olena Shulyak themselves with these structural damage. Because today, unfortunately, it is not formed. Well, yes, we have created polygons, we have taken out the structural waste there, we have even taken out the asbestos that the Verkhovna Rada has banned, but we do not know what's next. And the law, unfortunately, does not stimulate this secondary processing so that the same construction companies use such materials.

Olena Shulyak There are no preferences at the technical level, nor at the financial level, which can include some kind of stimulus through taxes. And this is such a huge challenge for Ukraine, because more than 100 million tons of these construction damage are now in Ukraine, and we need to find the right recipe for how to deal with it.

Ernest Gramatskiy The circular economy, as you say, is simply the processing of these waste. And the use of them again. But look, we have a Ukraine Facility, there are 160 indicators. In order to receive these 50 billion euros, we must carry out reforms, thank God.

Ernest Gramatskiy In order to get the appropriate tranche, our Ministry of Economy will have to develop a strategy, a national strategy that will be applied to the circular economy. But the strategy is a vision, it is not yet a specific plan of action. On this very issue, we would like more intensive, more steps that would already help to apply it at different levels, starting from the processing of such materials,

Ernest Gramatskiy new technologies, ending the use of these processed materials directly in the road economy or in civil construction. Thank you very much.

Ernest Gramatskiy We talk about Euro-standards, about urban standards, but we see very outdated norms, still Soviet norms, and we see how the DPRs, for example, have already renewed there, but we still draw a lot of things from the Soviet Union. The City Building Code of 2010, 2017, 2023, there were three attempts of such global ones, and now such a negotiation begins, and also such a framework, a basic city building code.

Ernest Gramatskiy How much is it needed now? Is there any misunderstanding in the working group? Are the builders lobbying something, not allowing it to be accepted? The builders are not lobbying anything, unfortunately or fortunately. Let's be honest with the builders.

Olena Shulyak Here I see the representatives of the builders, everything is fine. They agreed with the municipality, they have some corresponding conditions, they know that there are some reference points, here are the local conditions and restrictions, here is the permit, if the SS-2 is expensive, I will go to the SS-3, I will not pay in the DIA, I will not go to the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA, I will not pay in the DIA,

Olena Shulyak In order to change something, it is very difficult. You all know my unsuccessful attempt with 5655, such a total digitization and introduction to the market of private controllers. We saw a huge opposition. And those who opposed, I gave the opportunity, I, on my initiative, proposed, I say, create a working group. Please, if you want a urban development code, let's make a urban development code.

Olena Shulyak The working group is developing the urban construction code for the second year. They are now at the stage of developing the concept. We have not yet reached the urban construction code. The working group is working on the concept for the second year.

Olena Shulyak There was an appeal this year to an international project. They asked for $1,100,000 from the United States to write this concept. They say, give us experts, we will make round tables, discussions, support in the media, and we need $1,100,000 from the United States for this. It seems to me that this would be the most expensive concept in the history of our country. I don't want... I think it's a delay.

Olena Shulyak because it is profitable to leave it as it is and to leave these customs

Olena Shulyak on every route, get a land plot, get a town hall, get a permit, get an import into operation. Unfortunately, so far it will last. But there is good news. We have, as I say, there are eternal topics in Ukraine. This is the City Building Codex and the City Building Cadastre. But the City Building Codex, I think, will not be made in our cadence, and the City Building Cadastre, it got to the indicators in the Ukraine Facility.

Olena Shulyak And it encouraged the government to adopt the relevant legislation. We have already created a state enterprise, or rather a re-profiled one, which will deal with urban development at the state level. This means that we will finally fill it with modern urban documentation. Thank you to all the donors who have joined us. Now they are financing the development of urban development.

Olena Shulyak I don't know if this will affect Kyiv, but we understand that Kyiv and big cities are slightly different rules and approaches, and it's not always a question of money, because Kyiv definitely has money to develop new urban construction documentation, there are no certain wishes or political will.

Olena Shulyak But the urban construction cadastre will be, and we will go a little bit, not as fast as I wanted, but we will go to the automatic formation of urban construction conditions and restrictions, when everyone will be able to go there, see these restrictions, take it as a pull from the information and go on to design. Well, these are my dreams. When we started to create a single state electronic system in the field of construction, no one believed us, we laughed, they called me Lena Cabinet.

Olena Shulyak But now the system works. 105,000 users in it, more than 160,000 permission documents, 11 billion anti-corruption effects. Well, let them laugh, and we will do our bit.

Ernest Gramatskiy Thank you very much. We do not have time to ask about the demographic crisis, about educational programs, about the recruitment of veterans. These are your topics, veterans are renewed. But we did not fully understand how our Dream system works, because we tried to understand it practically. It has already worked, it has already developed.

Ernest Gramatskiy And in general, how do projects go there? But now is not the time, there will be a first section, and maybe there we can ask you. But in general, about the real estate market.

Ernest Gramatskiy Will the war end? What is its future in the next 3-5 years? I would ask about something else. From your point of view, legislative reforms in the real estate sector for the next 3-5 years, what do you have in your head, what do you think is the most critical? I don't have much in my head, but I will say that we don't have much time. I am very worried that those of us who work in the construction sector

Olena Shulyak Well, this is a very prejudiced attitude. Our society tells us, well, if you are a builder, if you are in construction, you are a corruptionist, you destroy everything green, and in general you are a bad person a priori. You haven't done anything yet, and you're already a bastard and a bad person.

Olena Shulyak And it seems to me that we have, well, I would really like the construction industry, I love it very much, it is about what to create, it is about the future. And I would really like us all to work together on this new image of the construction industry, on the new image of the builder, because the construction industry itself

Olena Shulyak projects, builds, creates, drives the economy. After all, in the construction sector, this is the highest multiplicative effect from when the appropriate money works in it. Now, in the construction sector, this is the production of building materials, this is new construction equipment, this is the market of contractors. And I am sure that there will be huge challenges

Olena Shulyak Regarding the post-war restoration, I am now communicating with the representatives of the construction sector, but everyone wants to rebuild according to the principle that we often talk about, to build better than it was. And everyone wants to see their new cities in a different way, not in this post-Soviet construction system.

Olena Shulyak Therefore, you see, this problem is not in the legal field, but in the heads, how to work, how to prove that construction is good, and that construction is not about theft, and that construction is not about destruction, but, on the contrary, about creation. And if we talk about legislative initiatives, of course, we will continue all things related to digitization,

Olena Shulyak We will now invite you all on October 21, we will have committee hearings, we will work on the digital component of project documentation and direct expertise.

Olena Shulyak They came in, looked at the expertise market, got a little upset, because there is no responsibility, there is no quality expertise, there is no quality expertise, there is no quality project documentation, there is no quality project documentation, the builder or the customer is to blame, because he is building something wrong there. Therefore, I am quite harsh about it.

Olena Shulyak If you break the law, if you don't meet the criteria, it doesn't matter where you work. Whether you are an architect, an expert, an engineer or a consultant, you have no right to work in the market. We have another bill, I think it was related to 5655.

Olena Shulyak It was related to personal responsibility, increased criminal and administrative, specifically to service providers. That is, the architect designed with violations, you will be responsible. Technical inspection, came, checked, signed those and those acts, you will also be responsible, you will not have a certificate, you will not have access to

Olena Shulyak to the profession, access to the market, but so far it remains a dream, but we will not stop, no matter what positions, no matter what cadence, 9th, 10th, 12th, we will not stop. Now we looked at a colleague, we still have a big problem, this is the Ministry of Culture, cultural heritage, and in general the ability to work

Olena Shulyak European, civilized, in this very sphere. There is still a lot to be done to make these rules modern.

Ernest Gramatskiy The Ministry of Culture is a pain, we will talk about it. As lawyers, we say about criminal responsibility, do not rush. There are many other responsibilities, but criminal is not always used properly in our country.

Ernest Gramatskiy Thank you very much for our conversation, for everything you said. We hope that everything will be the same and we will be there together. We invite you to the first session. We also invite all the speakers of the first session to the stage. Our first session is about the market, housing and real estate, the corrective of the war time. Thank you very much again. Thank you.

Part 2

Ernest Gramatskiy They avoid such discussions, such forums and understand why. We understand when the business will communicate, will ask questions. And finally, I see that the situation has not changed for many years, because there is a question, and the question is precisely for the executive authorities.

Ernest Gramatskiy Very often we appeal to the parliamentarians, but the parliament does not listen. This is also state power. But still, we work at the level of executive power, and every time we are in direct battle with them, but they are not there, and I want to ask a little more questions. The same Ministry of Culture is one of the executive bodies, about which we will also talk. Our topics,

Ernest Gramatskiyfrom year to year remain critically important. They are the same. As before, we had a discussion about legislative reform, any legislative reform in our field. We are also afraid of legislative reforms.

Ernest Gramatskiy and about market conditions, and about future investments in real estate. All the topics are relevant, but every year they somehow look like we are in the new world. On the previous forum, we talked about how the business adapted to terrible challenges. We talked about the deficit of labor, we talked about the breakdown in the supply of materials, electricity, we talked about how the business adapts to

Ernest Gramatskiy any challenges, including the ruined economy, the prospects for post-war restoration, and so on. But we are already talking a lot about restoration. It is possible and necessary to talk. There is even a separate forum, not only legal practice, about restoration. But what is very important to talk about right now is not about

Unknown Speaker It seems to me that we need to talk about transformation. And this is a new term. Because in a few years, business and all of us have adapted a little. It is impossible to adapt to this, but we have adapted. And now we have such a stage, a period of transformation.

Ernest Gramatskiy Maybe somewhat pessimistic, because no one is going to make predictions when this damned war will end, or after the elections this year, or next year, when it will not end, it will end, it is clear. But in any case, we have not adapted, but we are transforming. Why so? Even from a medical point of view, there are such syndrome of adaptation, stage of anxiety, depression, exhaustion, it is clear, but ...

Ernest Gramatskiy For more than three years, the human psyche has not been able to withstand such pressure. And in any case, our consciousness turns into a different state. Therefore, it seems to me that we are a little different. Now this period of three years is just passing.

Ernest Gramatskiy And talking to developers, developers, representatives of state authorities, in principle, I see that everything is the same as in the entire Ukrainian society, that a new shape has appeared. Faith in the future and an unwavering desire to live right now. Therefore, we say transformation.

Ernest Gramatskiy And although there is faith, the number of ruins is terrible, they simply cannot be imagined. Hundreds of thousands of lost houses, tens of billions of dollars and direct and indirect losses.

Ernest Gramatskiy But on the other hand, the desire to restore all this, the cities, the infrastructure, they are just as powerful. And when you prepare for the form, you constantly get the last ones in half a year, a year, all the articles, comments, numbers, all the analytics. And what do you see? A little about the figures, Ms. Olena said about it, but on the other hand, I want to highlight this problem. The World Bank and the UN, that is, quick assessment of damage.

Ernest Gramatskiy When the numbers are called 480 billion dollars in losses,

Ernest Gramatskiy You don't understand what kind of number it is. 10, 100, 500, and it's only the 23rd year. That is, we understand that after the shelling of the power plant this year and so on, it will be much, much more. This is the number that Ukraine needs. The School of Economics is more than real,

Ernest Gramatskiy The numbers are more clear, but also not clear. The School of Economics says that in the last year, Shkoda is worth 20 billion. Last forum, when we held the last forum, this figure for the School of Economics was 140 billion. And in the last year, plus 20 billion. And I already wanted to focus on 20 billion. Just focus on 20 billion.

Ernest Gramatskiy and talk about what 20 billion is. 20 billion is the GDP of Ukraine, every year there is an increase, 6-8 billion a year. And now, in the last year, the losses are 20 billion. This means that Ukraine is throwing us away for 3-4 years. That is, the lost years, only in the last year, are for 3-4 years. And then you understand what 20 billion is. And, well, it's...

Ernest GramatskiyIt's very, very scary. You read another analytics, for example, the Center for Public Finance. They say that we calculated all the losses that are in Ukraine, it is 860,000, you can provide housing to 860,000 families. It is also not fully understood, 860,000 families, then the figures are 2 million people, and 2 million people for Ukraine to provide housing, well,

Ernest Gramatskiy Not fully understood. And then everything becomes very clear when you understand that if for Estonia or for Latvia, just for all of Latvia or for all of Estonia, to build all the housing they have,

Ernest Gramatskiy This is exactly 2 million, that is, this is a loss of a whole country. You can build a separate country, all of Estonia or all of Latvia. And these are our only direct losses, direct losses. We do not talk about everything else, not directly, and in general, about the moral damage and how much we will heal it.

Ernest Gramatskiy Housing buildings – 60 billion. Infrastructure – 37 billion. 90 million square meters of destroyed, damaged objects. Every tenth house was destroyed, every tenth square meter. That is, the tenth square meter in the whole country is destroyed. The losses of the construction sector, they calculate directly, directly, directly – 13 billion.

Ernest Gramatskiy We also talk about the environmental crisis, which is new, which was not there a year or two ago, and now it is really understood. That is, if we talk about 100 million tons of garbage after the war, this garbage must be put somewhere, and this is 30 million hectares of territory that are polluted with this garbage.

Ernest Gramatskiy And I don't understand what to do with this problem, it will get bigger and bigger. That is, the amounts are simply unacceptable, these figures are unacceptable. A little bit about the market, a little bit about the real estate market. I'll start and then I'll give the speaker a word. Money.

Ernest Gramatskiy Well, as the National Bank says, as it used to say and now, that there is money. There is money in banks, there is money in people. People have 830 billion hryvnias in their hands. Another 11 billion in the currency on deposits. But it is clear that people do not spend this money, and especially do not spend it on real estate, because real estate is no longer the stable investment that it was before. International funds.

Ernest Gramatskiy The closer to victory, the louder they say that Ukraine is being considered as an investment object, but only after the end of the war, only in the process of restoration and reconstruction.

Ernest Gramatskiy If last year J.P. Morgan and BlackRock were more active, they are also getting tired and waiting for years, seeing that they are not so much talking about investments in Ukraine and a few more years and maybe the priorities in the world will change and BlackRock will do something else.

Ernest Gramatskiy Moreover, all foreign investors, they are like a gypsy post, one foreign investor is here now, they pass this post to other foreign investors and large funds, that Ukraine is fine, everything is clear, but the judicial system has a question, the law enforcement system has a question, the prosecutor's office can come to you tomorrow, that is, you invest millions, but tomorrow the prosecutor's office will be in the doors and will ask

Ernest Gramatskiy It may be a vindication claim, it may be a negation claim, it may be a forest, it may be a water fund, and so on. And the day after tomorrow, you have no real estate, no investments, no money, you have several court cases and a lot of criminal cases. Here are the portraits of the foreign investor and his future.

Ernest Gramatskiy As for the market, we see that it works at its own pace. Those who can no longer pull have already left the market without returning. Those who can still pull while they remain in the market.

Ernest Gramatskiy New projects are not very quickly adopted. Of course, all new projects are already adopted. Generators, shelters, autonomy, all this is already there, or almost there, but if you look at the number of MONs,

Ernest Gramatskiy and see that not so many new monies are being registered, so we understand that all developers are trying to finish their old projects and are not in a hurry to new ones.

Ernest Gramatskiy There are a lot of problems, of course, and the staff deficit. Everything is clear here why and how. But there was also a shortage of wages. If everyone used to run in IT and there was just a dream profession in IT, now builders in the construction sector can completely compete with IT for wages, among other things. And so, speaking of lending, our financial sector

Ernest Gramatskiy It's more correct to say that, but what I see is that with credit, everything is clear, it just doesn't exist. It just doesn't exist and that's it. There is a housing, for example, and it was a rescue circle for developers and buyers for some time. But, of course, these volumes are not at all what you can count on. Prices on the market.

Ernest Gramatskiy I would say it in a different way, here it is not understood stably. That is, in the past year, in the crown, with these things, nothing was understood. Someone sells for $ 5,000 per meter, someone sells for $ 1,000 per meter. And there and there there is some demand, on which it is based. It is not understood what volumes are there, we also understand that they are not at all the same as they were.

Ernest Gramatskiy I don't believe in statistics with an average price, but the official statistics on the websites of our well-known providers are that in Kyiv, for example, the average price per square meter is $ 1,300, in Lviv $ 1,400, in Odessa $ 950. These are dollars, dollars, dollars.

Ernest Gramatskiy It may be incorrect to say so about the average price, but what can be correctly said when you talk to builders is that they say that in fact, in reality, not for the press, we sell

Ernest Gramatskiy about 15% of apartments compared to the pre-war period. 15%, that is, 6 times less. Last year, by the way, they sold 25%, and now 15%. So what are we talking about? What are we talking about? That is...

Ernest Gramatskiy People no longer consider real estate as a stable investment, more as a critical necessity. Those who have money do not rush to buy real estate. Those who need housing right in the country do not have money. That's the circle, and that's how it remains. Therefore, there is still a long way to go. I will already finish.

Ernest Gramatskiy In general, our real estate market is not only bricks and stones, it is also such forums as our forum, and this is the foundation of changes in the final case. Let this forum be another confirmation of our stability, peace, and the future. Therefore, I propose to begin. Glory to Ukraine and glory to the Armed Forces of Ukraine!

Ernest Gramatskiy On our first panel, we will be discussed both the future and the present of the real estate market. The next speakers, you also see the program, know all these famous people, but for the protocol, I will still present them.

Ernest Gramatskiy Mrs. Olena Shulyakova will now return to us. Vitaliy Nestor, deputy of the Kyiv City Council, the first deputy head of the Commission on Regulatory, Deputy Ethics and Prevention of Corruption. Yuri Martyniuk, executive director of the Association of Western Ukrainian Builders.

Ernest Gramatskiy Sergei Mamedov, our forum friend, economist, a successful banker, more than 20 years of experience, the head of the board of the shareholder organization Globus. Globus is a top

Ernest Gramatskiy Top-1 on deposits, the most generous bank for the population, top-5 of the national rating of banks, top, top, top, top, top. Yes, yes, yes, this is from your Facebook page. Ms. Anna Layevskaya,

Ernest Gramatskiy Of course, he is the commercial director of Intergalbud. We will also talk about Intergalbud in a separate promotion. He is a member of the Intergalbud supervisory council. Next, I don't see Sergey. Sergey Dakhnovskyi is our colleague, a partner of the legal company Yan Legal.

Ernest Gramatskiy Next, Andriy Zhurzhiy is also our colleague, our friend, founder of the investment company INZHUR, in the management of assets of over 2 billion hryvnias, and there is a lot to say, we will also talk about it when we give you the word.

Ernest Gramatskiy We have Igor Nikonov with us, a Ukrainian entrepreneur, founder and president of one of the most successful development companies, Cannes Development. Well, Cannes Development should also be represented. Republic, Ocean Plaza, Senator, IQ, Business Center, 101 Tower, Faina, Comfort, Tetris, and so on, there is a very large list.

Ernest Gramatskiy Since our forum is all the same business and legal real estate, I proposed to start with business and all the same business thinking, as those who directly see with their hands and eyes everything that is happening, and so I will start with business. Igor Volodymych, are you in touch?

Ernest Gramatskiy We want to start with you. Yes, I think so. Thank you, thank you very much. We talked about problems, challenges, legislation. This is all good, but to implement this legislation and then live by this business, by this legislation. Therefore, it bothers all investors such a general question in general, in general, in general. What about the market? Is it there? Are we building or not? In a few words, please.

Igor Volodymych Well, look, thank you for the invitation, but the market is certainly there. It is not for everyone, because now people, well,

Igor Volodymych They are more attentive to the infrastructure that is built around these projects. And, of course, such tendencies have existed for a long time, let's say, abroad. Even once the mayor of Paris, Inka, she made her political program electoral in the fact that all districts are formed around schools. Schools, yes. That is, middle schools.

Igor Volodymych where it is really convenient for people, it is a big problem for children to go somewhere, to transport them somewhere, to travel. And so, for example, in our every project, we build all schools, we build kindergartens and kindergartens, and it really gives its result, so we are fine with the projects we started before the war, we continue them all, and they, in principle, work more or less successfully. In addition, the sales volume is less than

Igor Volodymych before the war, but the price is not lower, and even some are higher. Well, the price has certainly increased over this time, but in any case, it is alive and working. As for commercial real estate, the criteria have changed a little here. Basically, the rental of apartments works very well,

Igor Volodymych Renting, for example, for urban, inexpensive businesses and real estate, I wish it grew, if we compare it with pre-war times. And the commercial industry in central cities,

Igor Volodymych A little less. That is, not so many investors who want to invest, then do repairs and, let's say, not so many businesses that are preparing to pay this rent today and return these investments with a profitable profit.

Ernest Gramatskiy That is, with the price, it is clear that right before the war and so on, good, thank you, but here is a portrait of a consumer, of buyers, that is, your clients buy apartments, is it more for themselves or as an investment, repair, investment, resell, as it was before, or they buy and then rent, or is it still their own housing and that's it?

Igor Volodymych Well, you know, the statistics are as follows. About 70% buy as their own housing, and 30% really buy as an investment. And because today, for example, renting an apartment in our projects, well, it takes a day, well, maybe a day and a half. And you need to take it by chance. If it is still under renovation, then in general it is 2-2 hours, there are queues, and people in the sales department know exactly these applications for rent. That is, look.

Igor Volodymych Both the renter and the buyer are very clear about the transport component today. That is, do they need to waste time moving children around the city? I will tell you, we did such a survey, and you are very surprised that 80-85% of people do not even enter the territory of our city.

Igor Volodymych If all the conditions are created for them to receive all kinds of services that they have, that is, not only children's schools, but also shopping malls, fitness centers, and so on, then, in principle, they have nothing to go to. There are office premises, they organize a small business there.

Igor Volodymych I think this trend works and works very well, because people really have a sense to value their time. Now I want to say a little more.

Ernest Gramatskiy If you ask a question about how to sell, what people buy, what has changed. Well, this EOSL program is a great thing, I want to say a few words about it, but ... And this was my next question. What do you want to say about EOSL, about lending, what amount, how did it help you, developers, some buyers?

Ernest Gramatskiy But what about the future of this home? Is there any loan? There is no loan, of course. This is a big problem, because if you have a project under rent, it is not a leverage for the bank. And, of course, the regulatory policy of the National Bank does not allow

Ernest Gramatskiy to take this project from the bank, as in the rest of the world. In the rest of the world, if you have some documents on the plot, on the use of the plot, you have the documentation that you received, the project is agreed with everything, you received a driver's license, that's it. This is already an asset that can be invested in the bank and, in principle, some kind of downpayment has been paid, you have an open credit line and you are working.

Igor Volodymych There is no such thing, because the project is not a stand-in. And why is it not a stand-in? Because today we have, I say, four governments. I will tell you that we have four governments after, and the first government today is these, let's say, activists who have turned our lives today, let's say, they have turned some, I don't know,

Igor Volodymych I can't even find the right word, because they replace themselves with the authorities, with the courts, with their pressure on the same judges, on the same law enforcement system, on the same politicians.

Igor Volodymych Moreover, politicians, who are invading each other, use them and use their hands, thinking that they are fighting with each other, but the extreme is always business. We are always the ones who suffer. Today, in the association, we will put together a list of branches that were, let's say, frozen, slowed down, taken away, chosen illegally.

Igor Volodymych This is a violation of the basic principles of running a business with the help of these activists. We will publish this so that the public understands that they are just being led by us, and politicians are also leading.

Igor Volodymych It's not that the law is the main point of support for everything, but there is this pseudo-public opinion. It has become higher than the law, and it doesn't make any sense anymore.

Igor Volodymych I would recommend to the government to change the position a little. Look, now about 70% of people buy oil, and 30% only in the usual markets. I believe that if the government wants to start an economy, then it is necessary to either remove the possibility of buying in the second-hand market,

Igor Volodymych but to put those categories of the population who have really lost their homes and they need an apartment with repairs quickly, which may be at a cheaper price, maybe so. Because I believe that this program has, including, Olena, as you said, about the multiplier, which is already known to everyone, how much for 1 hryvnia, this is a minimum of 6, goes into the economy.

Igor Volodymych So I will say that this program must use this multiplier, it must run it. I would look into this matter. This is not that you need a CAN there, because practically our price category does not use the ESL program very much, but for the country it is a very important thing, and I would recommend paying attention to this.

Unknown Speaker Thank you. New projects? Are you in a hurry to start new projects? Do you see a powerful campaign? Do you have any horizon for planning?

Igor Volodymych No, you know, we are not starting a new project. We have even some projects that we have not sold any apartments. We froze and we are waiting, because today, well, indeed, this is an unforeseen situation. You will understand that the demand goes in waves, and it depends on different parts. First, there was a stop when the mobilization began. The second stop was when there were attacks, yes, that is, attacks. The third, when they started electricity.

Igor Volodymych and, let's say, unstable, it will then roll off, and people will somehow calm down, and this situation will become familiar. They are already used to it and move on. And new projects, you know, they need a lot of big risks and a lot of big investments from the beginning. Because we can't sell lower prices to attract people. This is a scam that we never get into, because I understand that they always end.

Igor Volodymych And to have that price and value today has grown a lot. There is one thing when you have a project, and in order to develop a new project, you need to spend money.

Igor Volodymych and positioning, and creating infrastructure, as you know, we create it in parallel or at the very beginning of our project. Therefore, no, we prepare new projects, we fight with, let's say, the community, almost for each of them, because, you know, they stood, stood, stood, and only when someone starts doing something, a bunch of activists appear and immediately say, well, let's do something with the park,

Igor Volodymych Or let's give status to some monument building. Yes, cultural heritage. I think that the authorities have to...

Igor Volodymych And now the new Minister of Culture, I think that somehow, in principle, it is necessary to convey to him what is being created, and we will make this list and, of course, we will familiarize him with it. And in this way, in recent years, since it was the last number,

Igor Volodymych I think that the right to ownership should be, let's say,

Igor Volodymych It cannot be moved, it must be final, no one has the right to touch it. If it is given, the right of ownership is illegal, which I also understand, it can be, then they must be punished.

Igor Volodymych those people who gave this right of ownership, and not the owner who received it. And today we have only the last one, who has this ownership. No one is responsible for the fact that for 30 years, for example, the Ministry of Culture or the public or local authorities did not provide documentation.

Igor Volodymych do not suffer from the fact that, let's say, the regime and the limits of use of monuments, architecture or history, they do not exist today. And they appear only after the investor has bought this building, 100% understanding that tomorrow he can build something on the basis of it. And he says, wait, do you understand? We believe that this is now cultural heritage.

Igor Volodymych So wait, can you give me back the money and somehow apologize and compensate me for the losses? But no one talks about it and doesn't even grumble. And no one, not the one who did not make this documentation, not the one who then gets this property from a person, but the one who owns this property on absolutely legal grounds.

Igor Volodymych That's what I'm interested in, well, not interested, but worried about. And it's not just me, believe me. And it somehow disorganizes people and has a very strong impact on the entrepreneurial mood and desire to do something, to climb something. Believe me, we are already taking a very strong risk by investing money in any project. You understand, the stock market is such a very, let's say, wave-like thing.

Igor Volodymych It can be in one moment, it can be any businessman, he does not risk. But listen, there is another risk that is added here. And that's why investors, foreigners, how can they come here if our document, by the way, let's say, you said about DIAM. DIAM, in my opinion, is the only body that really works as it should work. That's what I can say for sure, because I see and honestly surprised that it still works as it was planned by those who made it.

Igor Volodymych So, today, if the country thought about investments, then this paper, which is shown on the diorama, on the basis of all documents, it should be in the bank, it should be laid out, and it is a basis for any investor that he should invest money in Ukraine.

Igor Volodymych There are dozens of such examples in the city of Kyiv, which, unlike any investor, will not make any decisions.

Unknown Speaker Thank you very much. I must not interrupt you. I can't not ask the last question, but it is philosophical. What are the prospects of the market? What should we expect? I would say differently. Plan A, if the war ends. Plan B, if the war continues. What is the plan?

Igor Volodymych Look, we are moving all our projects, we are even building schools. We gave everyone another school, we are building another one next year. We are building our plans, the projects that are going on, we believe that the war will end. And if it doesn't end, I still think that the atmosphere that is formed in the country, who lives here, they are used to it, and they understand that life goes on, and you still have to live. Moreover, you have to live, you know,

Igor Volodymych A large number of people, I think, have a philosophical attitude towards life. Today they are there, tomorrow they are not. So let's live in some good conditions today. And I think that the place of residence, and, let's say, the comfort that there is, and the fact that they save time, I think that this will pay a lot of attention to, and it will work.

Igor Volodymych So I think that the projects that are complex, they will work even during the war. And if it ends, of course, I believe that there will be a construction boom, and God willing, we will find specialists who will work on it. Thank you very much, thank you very much for the interview. Ivan, thank you. Stay in touch with us if you can, time allows. We will continue. Of course. Thank you, thank you.

Ernest Gramatskiy I want to give the floor to Ms. Anna Laevskaya, because, of course, we need to ask all the developers, all the builders, all the builders. So, Ms. Anna, we all know about Intergalbud, we all know what we can know from the official. We love the most private

Ernest Gramatskiy Ukrainian builder. You read the news and see that they have fully installed autonomous housing. In another place, they began to register MONs. There, further. You sell EOSL at some crazy pace. The third news. The fourth news. You are already building abroad. And you really are building, because your competitors, and this is such a ...

Ernest Gramatskiy It's a very good thing when competitors say, yes, we are building next to them, they are doing well, and we see how it is being built. Therefore, we understand how many such news, pleasant news, will not say to you that

Ernest Gramatskiy There are some problems in the real estate market. How is it there? How is your company there? Why abroad? Don't you believe in Ukrainian prospects? By the way, you have been recognized as one of the best talk managers in Ukraine. You know, so your opinion will be very pleasant and very useful.

Anna Laevskaya I was waiting for this provocative question, but in fact, the company always puts the Ukrainian market in the first place. First of all, it believes in the development of development in its native country.

Anna Laevskaya The question here is that it is necessary to first look at various segments of the real estate, understand the current state of the market, and then comment a little on the problems and nuances that exist now. Sometimes my competitors tell me that the interval is just for the market, so don't mock your indicators, because the situation is very different. But in fact, if you take the market as a whole,

Anna Laevskaya the housing segment of the property. At the moment, sales are from 20% to 40% of the pre-war, depending on the company and the specific region. And this proportion depends mostly on whether the developer

Anna Laevskaya is actively involved in the program of EOSEL, or is it engaged in the development of such a direction for the sale of products? Because you are absolutely right to say that EOSEL is now called such an apparatus of artificial ventilation of legumes for the real estate market, because it has completely replaced a part of the buyers, a segment of buyers,

Anna Laevskaya They moved out of the country, they do not plan to spend money on real estate, and gave the developers a completely new portrait of the buyer. Because this is a target audience of people who could not pay for the purchase of a new house, their income does not allow termination from the builder, their purchases do not allow to buy an apartment in a short period of time, for example, 4-5 years. Everyone, as developers, was given as much as possible.

Anna Laevskaya Therefore, those companies that have a ready-to-build housing, because, unfortunately, what Mr. Ihor said, that 30% of the housing is the primary market, this does not at all correspond to reality. 30% is with the sale of apartments with the right of ownership from the builders, in fact. And so that colleagues understand, the housing at the construction stage has only up to 10% of the housing. It consists of the number of years that were credited in this segment.

Anna Laevskaya And this is probably one of the key problems of this program at the moment, that in order for the demand to be more active in restoring construction and new projects, lending and demand for sales should be at the construction stage itself, so that it stimulates the economy in the first place. In this segment, there is a village where there are very small results. The second question.

Anna Laevskaya In this program, more than 60,000 unique applications could be issued in a month, which could potentially be loans. The conversion rate is up to 5% according to the program. Such a conversion rate is not only due to the requirements of the program itself, the problem of the interaction of borrowers with banks for some time. It is also related to the fact that

Anna Laevskaya Developers, who decide not to take part in the program due to some legal and financial reasons, are connected with the fact that few developers have already managed to switch to MONs, in particular, which allow you to pass accreditation more quickly, to have, more precisely,

Anna Laevskaya There is no need to increase the value of a square meter when crediting under EOSL. This is also due to the fact that those objects that are on the market, they are either under construction or at a low stage of readiness, they do not meet the requirements of the program regarding the possibility of accreditation. Therefore, at the moment, if we consider the number of houses, projects that are accredited, it is quite small compared to the demand in the scale of the whole country.

Anna Laevskaya And the most important issue is the financing of the ESL program. This issue really causes a fight among many market participants, because, unfortunately, financing can be unstable, unforeseen in its scope in a month and a half, some close perspective. But at the same time, ESL has completely killed the commercial mortgage. We must understand this with you.

Anna Laevskaya In order for the market not to fall into such a strong dependence, and then it was not a terrible surprise that the funds were over, or the new tranches were expected, it is clear that, I think, my opinion is that the partnership of developers with banks should be developed, that is, a commercial partner mortgage program, when the developer compensates the bank for a part of the interest rate or finds other mechanisms.

Up to 39 minutes

PART 3

Andriy Zhurzhiy When they say that real estate is not interesting, I do not agree. Commercial real estate is not the same. I do not agree. Professional, quality real estate, which is capable of generating cash in these conditions, in the conditions of covid, for example, you will not buy it, just no one will sell it to you. An example of our funds, as Tarnes says, supermarkets, McDonald's. The last example. We collected money for new McDonald's. Approximately 50 million hryvnias.

Andriy Zhurzhiy I don't know, only 20 apartments? Well, such small, yes, small apartments, two apartments. How do you think, in how much time can such an amount be invested without advertising, just on the existing base of industries? Well, some options, I don't know. A day? Class. And where did you see such cases?

Andriy Zhurzhiy No, okay, we have this case, yes, 4 hours and 20 minutes, 50 million hryvnias, yes, a huge number of people who say, wow, how, we didn't make it, we only exchanged dollars, yes, because why? Because the international brand, McDonald's, contract for 30 years, free situation on the market, feels that rent is paid monthly, tied to revenue. People are happy to invest. Next we talk, what is the resource? Sanctioned assets. Sorry, sanctioned assets are not only somewhere abroad. Sanctioned assets are also in Ukraine, arrested, nationalized assets that the state must sell and must prepare them for privatization. You announced that the head of the state fund will be today.

Andriy Zhurzhiy I have a big request, unfortunately I will not be able to ask her the question. How does this happen? You, lawyers, have to understand that the enterprise that was nationalized a year and a half ago has not yet changed the Russian management to the state one. Well, this is nonsense to any lawyer. You nationalized the company, went to the register and did not take control of it. You say, we are preparing something for privatization there. What can you prepare if the head of the enterprise has a fund set for a month before nationalization?

Andriy Zhurzhiy We are talking about Ocean Plaza, one of the largest assets, a large asset of privatization, and everyone is talking about it, officials, deputies, we will sell something. This is a huge problem on the one hand, but on the other hand, our case shows that people are ready to give up so that there is justice. Because this is, first of all, a quality asset, and secondly, it is justice. It cannot be that the next oligarchs came and bought at some starting price. There must be real trades. so that the state, in the first place, gets justice and compensation for the losses caused by the country's aggressor. There is a problem here. Again, the legal plane is similar to the elections. I don't go to the elections because I don't decide anything. Friends, if the whole Ukraine comes to the elections, we decide so, you can't even imagine. The same with privatization. Who will let you buy the Ocean?

Andriy Zhurzhiy Look, if 100,000 people die, you can't even imagine, we will not ask anyone. Because just 100,000 people, millions of people, the amount of money is infinite compared to any oligarch in Ukraine.

Andriy Zhurzhiy Second story. Reconstruction, once again, as a case of investment and energy. We have a phenomenal case today. When Ukrainians are responsible for the fact that they are extinguished by light and say, look, you have winter, the light will be there for 5 hours a day. They are responsible for the fact that we have a subscription, we have not yet released it to the public, but we have launched a fund for energy, won an auction with Ukrenergo for 5 years and in the euro we will build And the Ukrainians say, OK, a thousand Ukrainians, we are ready, 2.5-3 million euros, and that's not the end. That is, the Ukrainian responds to such a challenge that he will sit without electricity, I think, he should take money, buy dollars and sit and do nothing. People say, no, no, I will throw energy there, let it be.

Andriy Zhurzhiy So, once again, without time, I think that we have great challenges ahead of us, and we need to learn to unite and do common things. Our example will, I think, be shown to others, and there will be more such companies, because in Ukraine I think many lawyers know, in the first place, what is associated with joint investment. Developers have created a fund and through this fund sell real estate. And this is OK, because it does not work in a vacuum, it works in a situation when other developers work just for cash, not systemically. And you have to work somehow. But we need to move on to some international practices, when asset management is the actual investment of capital, when it is not about sales, but about purchasing, and when a small investor can become a serious player by combining with other such investors. Thank you. Do I have something there now? No, no, no. Thank you. I'm sorry, I have to run, I need to go to the committee. Yes, thank you very much. Thank you.

Ernest Gramatskiy One more problem that hurts a lot. I will now give the floor to Mr. Vitaliy. This is Dovhobudy, and we see that this is in Kyiv. The building of the Karpenko-Karovo University, the hospital in the observatory, Traeshchina, the building of the Ministry of Finance, the Darnyi railway station, these are residential complexes, and so on. Here you can count hundreds. In 2019, this was a thousand underbuildings of Dovhobudy. And now there is much more. And therefore, something needs to be done with this problem. Here, on the one hand, the city of Kyiv, its overall appearance is very understandable.

Ernest Gramatskiy Another problem is that large territories are being occupied. Another problem is the protection of the rights of investors. And here are activists, activists, activists, let's take away, let's make a social housing, or whatever we do. That is, there are dozens of problems that arise and that exist. Tell me how to solve them, how do you see what is happening in Kyiv? That's it.

Vitaliy NESTOR Thank you for the invitation, thank you for the opportunity to speak. Indeed, today the city is making colossal efforts to solve the problem of long-term buildings. Work groups are being created, temporary control commissions are being created, investors are being invited. Because the first place where every trustee who does not have a home today goes to is the city authorities. This is the closest way to get to the local authorities. And the main element and problem that trusts and investors are facing today is the contradictory behavior of the city authorities, the central authorities in relation to construction. What does it mean? For example, our latest events, which are known to everyone, are UkrBud, Kyiv-MizkBud, housing complexes Arkada, Evryka, and so on, those you mentioned.

Vitaliy NESTOR There is a specific attitude towards those with whom it happened, and what Ihor was also talking about, that there is a view that today it is possible to recognize as impractical or simplify the actions about which the relations that began in the distant 2005-2008 were discussed. For example, if we talk about UkrBud, a part of the buildings were ordered to be built by the Ministry of Defense in 2005. And today the Ministry of Defense recognizes that the agreements that have already been signed, where the apartments have already been sold, where the houses have already been built, have not yet been put into operation. And that's 110 houses in a minute, that's 11,000 investors who are currently in the management of the Kyiv-Mizbud holding. On average, 33,000 investors and their families in total. If we take the colossal and global problem of the city of Kyiv, then the number of investors together with families is one district. This is an average of 150,000 people who have left without housing and cannot get it today. When they come to the city government, They say, give us money or help us with the reconstruction. The city signs a memorandum, sets an agreement with them that we will cooperate and help rebuild. They come to the central government, the ministers all sign a memorandum, they say, we will give you money, loans, we will cooperate. When the resonance and agitation fall, accordingly, everything subsides. And more than that,

Vitaliy NESTOR The concept that you taught us 15 years ago, being your student, on the lectures of civil law, the controversial behavior, it has a place today in the practice of the Supreme Court, that no one can act contrary to their previous behavior. And in this case, the city, as a lender of land, as a guarantor of the rights of investors and creditors, in some cases, it can be called openly, because this is the case in many court processes and social networks, does not want and cannot and refuses to continue the activities of the lease agreements for Arkady investors in Sokorka. Having signed the contract in 2005, 15 years have passed, the developer wants to build houses for people, and the city says, sorry, we will in court order refuse you the continuation of the lease agreement. And an investor or a bank developer comes to the bank and says, give me the money for the construction, you have nothing to do with it, you will not come to our compliance, look at the court register of decisions as the first source that every developer who wants to receive a loan passes. This is a problem that 90% of all developers in Ukraine have faced today.

Vitaliy NESTOR We can deal with this problem in several ways, which we have worked on today in the Kyiv City Council and, in particular, in working groups. First of all, this is a way to involve the city's funds through the purchase of apartments, which will later fall into the balance of the departments of municipal property. And in the future, these apartments will be sold to future investors after construction, with the right to rent, with the right to buy. Another mechanism is the increase of the statutory capital in order to build on what people have been calculating for the last 5-7 years. If we talk about separate projects,

Vitaliy NESTOR Unfortunately, today the city does not have the opportunity to allocate its own money as a loan for investment, but we are ready to become a guarantor and a guide for the actions of developers and builders who in the future will confirm that they will will pass to their final investor the property they are calculating. Contradictory behavior is another issue that concerns the relations between the city and the construction sector. This is the shareholding. The shareholding that is provided for today and should be paid to everyone who builds a town.

Vitaliy NESTOR An interesting example was given to us from foreign countries, where our colleagues are also building, that all the expenses for leasing are already included in the value of the land for purchase. In the city of Kyiv, unfortunately, there is no such thing. Moreover, today, changes have been made to the law that leasing for houses that were built back in the 1920s and 1920s, today, construction companies must pay for this leasing. And the city, unfortunately, is not interested today in what infrastructure facilities were built, what engineering networks were held, where, how and how much money was spent on it. And this is the element of contradictory behavior, which I believe is irrational and unfair in relation to business and the city government.

Vitaliy NESTOR Unfortunately, the negative factor is that today the city cannot lend and cannot invest the money that the city budget of Kyiv has for this year is 72 billion hryvnias. The expenses for 12 billion hryvnias are more, but nevertheless, The free resource that the city could allocate today to launch certain processes, it is. You just need to use it correctly and rationally. Moreover, when communicating with investors and creditors in such a school in working groups, every investor and trustee knows the cost value and the construction stage of their housing complex better than some high-profile construction departments in construction companies for a long time. It all shows that we are aware and people are aware and believe that their houses will be completed. It all shows that the city must hear the position and the investor's vision. And I am convinced that if there is political will, the city will allocate funds to start solving the problems of long-term buildings in the city of Kyiv.

Ernest Gramatskiy Super. Super. Thank you very much. Maybe there are any questions? Because this is such a topic.

Ernest Gramatskiy Thank you. Then the next, equally important topic is cultural heritage and all about it. Because for all lawyers, for all builders, the topic of cultural heritage is a separate topic. And this balance between to preserve architecture and history, but on the other hand, not to be left alone. A large number of these objects, which in no way are in a state of emergency, are possible and not interesting, but pseudo-activists somehow block any processes, and therefore it is very difficult to find this balance between the smart and the not smart. You say that there is some work on the mistakes. Is it in the legislator, in the executor, in the executive authorities, or is it in the founders? Five. Five minutes, thank you.

Sergiy MAMEDOV Well, maybe it's very symbolic that, speaking about the work on the mistakes in the cultural community, we remain at the very end.

Ernest Gramatskiy And there is very little time. That's why, perhaps, it's also when, according to the final principle... Just a little remark about Sergei. All the forums have passed, we have banks left to the last. I promise, I said that Mr. Sergei, you will be earlier, because I understand, maybe you will be the last, and again banks and money will wait somewhere there. Banks have money for cultural heritage, but there is no money. This is clear.

Sergiy MAMEDOV Well, from the passages that many previous speakers expressed towards our central authority on the issue of cultural heritage, it is absolutely clear that, perhaps, if we talk about the urban sphere, then it is extremely difficult to imagine the most explosive union between cultural heritage and construction in the society.

Sergiy MAMEDOV Mr. Ernest asked why I work with mistakes. This sphere is very wide, considering the factors that affect it. Starting from the state of legislation, from the legal or judicial practice, ending with the effectiveness of the activities of authorized and controlled bodies and, of course, the goodwill of the participants of the market itself, which is sometimes not quite goodwill. At the same time, if we talk in general about the urban development sphere, it is absolutely obvious, it is absolutely fair to point out all these positive, radical, fundamental changes that affect the civilized development of our real estate market. But if we talk about the law enforcement segment, In my opinion, the practical effect of all these changes is the least noticeable. And the result of this is that we continue to feel this great resonance of any events in the sphere of their politicization recently, when not every urban transformation in the historical part of the city, regardless of whether there are legal grounds for this, or consider these or other legal factors, becomes the subject of public debate, causes public uproar, opposition and so on. As a result, we have a systemic complex problem, which we talked about today, that in fact, in recent years there has been such a demonization of the market,

Sergiy MAMEDOV the real estate, as well as those who are in the construction market, when it is the wealth of the builder and his sacks of officials who have nothing sacred, as Ms. Yelena said, it is applied to the entire market, it applies to each participant, regardless of the level of his moral behavior and his good conscience. Considering the limited time, I will say a few remarks from the practical experience that we have in this area.

Sergiy MAMEDOV In my opinion, the most painful issue in this problem is the insufficient level of security, in particular, the occupation of our landmarks or objects according to the urban documentation that concerns these issues, in particular, historical architectural plans in the form of general plans of inhabited cities or complex spatial plans of construction. and, accordingly, scientific and project documentation, which must determine the boundaries of the monuments, the boundaries of the protected areas, the types of use, and so on. Unfortunately, I do not have fresh data, but as of 2018,

Sergiy MAMEDOV Only 9% of the memories had scientific project documentation, and only 20% of the more than 400 historical settlements, which are determined by the legislature in Ukraine, had historical-architectural-based plans. There is no mention of their update there at all. And I, following the changes in legislation on this matter, will say that I understand that the legislature pursues the absolutely good goal of creating a single platform on the basis of a possible state land cadastre, where the urban construction cadastre, registers, documents, including the memorandum of security issues, will be attached. However, if we understand that at the moment, under each historical-architectural support plan, appropriate scientific project documentation must be developed, and its order has not yet been approved by the Cabinet of Ministers,

Sergiy MAMEDOV and unconstitutional requirements for the people who will account for it, and moreover, currently, according to the law, in the context of such a scientific project documentation, a project of the land system must be developed, which determines the limits and types of restrictions that are subject to the implementation of the state land register. Who practices in this area and understands the order of creation and the waste of time the composition of these documents, it becomes obvious that yes, we are talking absolutely about the right things, about the perspective, absolutely right. This is what will change the possibility of assessing legal risks and understanding of what the intention of the construction is to implement, in what ways, and so on. However, unfortunately, these changes, in my opinion, they are not in the subject of the issue that the severity of the problems of the cultural heritage should be resolved now. Why?

Sergiy MAMEDOV First of all, the lack of this documentation creates opportunities for various legal and non-legal manipulations of any parties and any participants in this market, depending on who and what is needed.

Sergiy MAMEDOV This is also applied to judicial practice. Judicial practice will be a separate panel on today's forum. I just want to remind those who are interested, maybe remember, how sensitive, so to speak, in recent years has been judicial practice on issues that concern, for example, determining whether there is a historical reality in the city of Kyiv or not. Does it correspond to the historical-architectural plan or not? The situation is the same in the city of Lviv, by the way, my colleague already mentioned it.

Sergiy MAMEDOV And, you know, if you add this game to relevance, when the court decision on the application of this or that norm is relevant, for example, for one dispute, which concerns the indictment of the miniculture, and is absolutely irrelevant when the denial of the issuance of local conditions and restrictions. All this, of course, is not in favor of the legal determination of these issues. Further, the question of the presence of this documentation greatly influences the ability to assess the subjects of the risk market. They are very specific and they need to be understood.

Sergiy MAMEDOV A lot of people, when talking about fraud, a lot of people, when assessing the impact on the future construction of the cultural heritage, are limited by the brought object or plot to the register. a monument of national or local significance, or to newly discovered cultural heritage sites. However, this is not the right approach, because there are a lot of underwater stones. The practice indicates that the object may not be a monument, but it may fall into the protection zone of other monuments. And here the corresponding additional urban construction restrictions may be changed, and requires a learned impact on future buildings, on the monument, and this, accordingly, can result in the corresponding limitation of the parameters of the building, primarily in terms of height. It should also be remembered that since May 2022, there have been temperate standards for determining the boundaries of the monuments, in case of the absence of such scientific project documentation.

Sergiy MAMEDOV Another example. The object is not a monument, but it can be attributed to significant or regular historical buildings. And according to the DBN of 2019, the plan to build a territory, a basic document in this area, it stipulates the corresponding restrictions on the implementation of urban transformations on such objects. And to know whether the building belongs to such objects, because there is no such determination in the law, and the legal status is not determined, can only be determined from the architectural plan. If it is, of course. And if it is, then the practitioner obviously understands the problems with the availability of this document and the possibility of its study or assessment, taking into account the state of the graphic part.

Sergiy MAMEDOV And there are a lot of such issues. I am not talking about the peculiarities of the Kyiv know-how. This refers to the famous decision of the Kyiv Council in 2021, which approved a list of buildings that can be destroyed or damaged, and which, again, can be brought to the newly built cultural heritage sites. There is no such legal status. The law gives a clear order of how the monument should be built, how the interiorization is carried out, the composition of public documentation and so on. At the same time, the decision has a recommendation character,

Ernest Gramatskiy It is recommended that the owners and users maintain their performance of preparatory or construction works before solving the issue of bringing them to cultural heritage sites. Mr. Serhiy, a very deep discussion. You already say such things. that not all lawyers understand. Everyone understood that your expertise is just great. You are watched by a lot of founders, these are your clients. Leave some information for business. We don't have any. No, no, no. Money loves silence. Thank you very much. The real topic is just great.

Ernest Gramatskiy We are not the only cultural heritage. Ms. Oleynoy and I started a forum, and we are now finishing the first session of this forum. I can't say a word. I can't say no and I can't say no.

Olena Shulyak

And how will it be? How to end all this? I'll say it very quickly. Look, our colleagues Yura Martyniuk and two representatives of the Ministry of Culture came out, Natalia Voitsiyshchuk and Vasyl Petrik. This is a huge positive thing, when representatives of the central executive body are sitting, listening, criticizing, ready to join. But not everything is in their hands. There are heads of the ministry, they are the directors of the department, but there is this dialogue. And I would very much like us to, on the basis of various platforms, on the basis of legal I have a legal ground at the base of any association. We started talking about the fact that business and our residents are worried about today. Because on the one hand, you see, all our monuments are being destroyed, and business after such stories as, for example, the flowers of Ukraine, it doesn't want anything. Because they came in, bought a room, wanted to restore. In the background, they brought souvenirs to the register, and the building is destroyed, no one needs it, and we all suffer from it as citizens of Kyiv. Therefore, it is necessary to find a solution. There will be no simple solutions, there will always be someone who will be dissatisfied, there will always be someone who will want to make money on it, and it will not always be officials. There will always be those who will do some manipulations, hate and so on. But the topic of cultural heritage is one of the key ones for the builders today, which is not resolved, let's say, at the level of legislation, does not give the opportunity to develop projects, invest and move forward.

Ernest Gramatskiy Thank you very much. I will really finish the first session. Thank you all, representatives of state authorities and local self-government, that you find time to communicate with business and our problems, and you listen to all this instead of the executive authorities. Thank you to the business that is being built. I think these are the most difficult times since the independence of Ukraine in the business, right now in the development business. We thank the banking sector, lawyers for their professional opinion. Thank you all. We invite you to a coffee.

PART 4

Roman Tytikalo Of course, we hear the problems, we hear the questions that arise, we understand the challenges that are in front of Ukraine, the challenges that are in front of the real estate market and everything else.

Roman Tytikalo In central Ukraine we see the fall of the market in Kharkiv or in other areas that were in line with the front line. We understand the zoning of certain moments, we understand the fear of investors to invest money. Moreover, I really want to confirm that there is a fear of even an internal investor to invest some objects, money, even apartments, some large objects. But on the other hand, we have

Roman Tytikalo Some positive examples of large privatization are the ones organized by the State Property Fund, large objects that have been unprivatized for years, and the corresponding results of this work. Of course, if we look at the number of plans for large privatization for 20 years,

Roman Tytikalo In the fourth year, it was 4 billion, if I'm not mistaken. Accordingly, in the budget, I don't know how much the State Property Fund has done, raised this bar. But Ms. Ivana Vasilievna Smachilova, I think, will tell us. Many other aspects of this work of the State Property Fund, the first, respectively,

Roman Tytikalo We are very glad to see you on our panel, on our forum. I would like to note that you are not only a high-ranking official, but also a colleague. We know that you are a lawyer with a lot of experience and a positive background.

Roman Tytikalo In addition, it is very interesting that a person grows step by step over many years, from the head of the justice department, then the ministry, then to the state property fund. This is positive when we have professional leaders in the state sector, those who have both experience and legal knowledge and understand how privatization should take place from the point of view of the law.

Roman Tytikalo But there are big challenges, as for me. There is a lot of discussion about whether to privatize other assets during the war, whether there is a better situation in the market. We have to understand that during the war, you can take much less money for an asset than during a peaceful time. But on the other hand, any asset that will stand for a long time, it will lose accordingly in price.

Roman Tytikalo I am convinced that the state is not an effective owner as such. That is why there is a private sector that must be managed, the state must regulate certain relations. We know about the privatization plan of the Hotel Ukraine in the competition that took place. We know about the joint chemical company.

Roman Tytikalo There is also the OCEAN PLAZA, but the speakers have sent you Russian managers who were assigned to OCEAN PLAZA before the war, to manage the investment union Libid until today. They say that from the previous panel there was a move in this direction, as far as it is possible, when the owner has changed, and the management has not changed.

Roman Tytikalo Therefore, there are many challenges to the State Property Fund, but on the other hand, the work that is taking place is clearly visible. We see a lot of activities that are being carried out on the State Property Fund. A significant number of state enterprises are being transferred to the property management and, in fact, privatized. The State Property Fund is doing well. You have been working on this now, fulfilling your duties. I hope that you will be appointed

Roman Tytikalo I don't know if you want to say something. The floor is given to the first rapporteur, Mrs. Ivanina. Thank you for the introduction. Indeed, the Treasury Fund has much more challenges and more tasks than it used to be, because now, in addition to privatization, in addition to the rent of state property, the management of state property, we also have

Ivanna SMACHYLO such areas as the administration and implementation of sanctioned property, the Land Bank, so the challenges have increased. Regarding whether it is necessary to sell property during the war. You know, in theory, you can say yes or no, but we have reality, we have what we see

Ivanna SMACHYLO what happens to the property, how many buyers come to us, how many participants in auctions. I want to say that if before the war, on one auction, on average, three participants came to us, then we now see that on average, in the last six months, five and a half participants come to us. Well, this is the average number of those who participate in privatization. Therefore, privatization is necessary.

Ivanna SMACHYLO Privatization takes place only in transparent conditions, through public auctions. This year we started a big privatization. For the first time in the history of Ukraine, a big privatization takes place in transparent conditions, which ensures competitive conditions. We do not know who came to the auction, no one knows the participants, and there is a real fight for one or another asset.

Ivanna SMACHYLO The value of the square meter, the value of the assets that we sell is no less than what we sold before the war. Why do we need to sell it? First of all, we need money in the budget. Everyone understands that. But it's not even about money. The state is not an effective manager. I think everyone understands that.

Ivanna SMACHYLO It is impossible to estimate how much the generation of losses is caused by the management of the state, state enterprises, the management of state property, real estate, how much losses such management generates every day. Hotel Ukraine, the place, the building, the history and the loss.

Ivanna SMACHYLO Years of waste, accumulation of debts. And this is not even about how we sold it successfully. We did not expect. We thought that if everything is fine, it will be 1.7 billion. It turned out 2.5 billion. From GDP 3.2 billion. 3.2 billion. This was a success and it is a success. We understand that these are jobs, that these are investments. And this is not even about how much we sold, but about how much the state

Ivanna SMACHYLO All the debts will be paid off, and then the investment in one or another asset will begin. Therefore, the result of privatization, not only the amount received by the state from the sale of this property, but also how it will revive the economy and the market, how this asset will look, this is already an effect. And this is really the motivation for why you need to do privatization.

Ivanna SMACHYLO They invest money, create jobs, pay off debts that have been accumulated for decades, even less than 30 years. There are such enterprises where debts have been accumulated for 50 years, 70 years. Therefore, the more we release non-profile assets to the market, the more economical it will be. Thank you for highlighting the issue that I did not hear about Ocean Classic.

Ivanna SMACHYLO I can answer, right? Yes, of course. We call them sanctions. In fact, when they come to us, they will already be taken into the hands of the state. This is a state property. Today we have more than 5200 assets.

Ivanna SMACHYLO They are different. There are those that we cannot sell because of their specificity and they are transferred to the Defence Forces, for example. But everything that can be issued for privatization, we try to adopt and implement. Each case, each asset is individual. And there is, for example, let's take an example. We have a company Orok, a very interesting company. We know that, we are convinced that

Ivanna SMACHYLO We will sell it. In a few days it will be on auction, we will sell it. But how did we get it? A good company, where the previous owners deliberately destroyed all the documentation. That is, zero information and about 20 different errors. We can't sell it like that. We took action to remove all the burdens, all the restrictions, to completely restore all balances, all the documentation.

Ivanna SMACHYLO when we have prepared this asset for the new owner, for the buyer, where he will see all the advantages and disadvantages, all the documentation, and this asset will not be followed by any incomprehensible burden in criminal proceedings and so on, we honestly put it on auction. And it takes time. This or that asset needs more or less time. Regarding Ocean Plaza, there is a problem. First of all, we are not 100%.

Ivanna SMACHYLO Secondly, there is a loan. A loan that burdens this enterprise. Now we are waiting for the decision of the High Anti-Corruption Court. We do not know what it will be. Will the loan be withdrawn? Will the loan not be withdrawn? We cannot move forward because the court must accept it. And it is clear that now we do not have the right to put on sale an asset with an incomprehensible loan case, because we, first of all, will cause problems for the new owner,

Ivanna SMACHYLO On the one hand. On the other hand, if the issue with the loan is resolved, then the added value of this asset and the price will increase. Regarding why managers stay in one or another enterprise. When an asset comes to us, we look whether it is better for us to stop the activity there, or whether it is better for the activity to take place in the future.

Ivanna SMACHYLO With the aim that during the preparation for privatization of the sanctioned asset, it did not lose its market value as much as possible. Therefore, different decisions are made in each asset. We stopped Aeroop, realizing that it would be so attractive if we stopped Oceanplus. And now there would be no one there. Obviously, the value of privatization would have decreased. Therefore, we are interested in it working.

Ivanna SMACHYLO Management. Not always management is a representative or a collaborator. Our situation has changed. We see that if the leaders cooperate with the state, if they give us all the information, agree on their actions, we can work with such a management, because there is a team. There are teams in the assets where there are more than a thousand people working. To disperse everyone, to destroy,

Ivanna SMACHYLO In any case, you need to make a different decision. As for the reason why the managing company works there, I think Mr. Andriy knows, but he didn't mention it. The previous owners, when they made a contract with the management,

Ivanna SMACHYLO They made a warning in their agreement that if such agreement is broken, the company has to pay 12 million dollars. And I have a question. Can we, as a state, take this responsibility, take this risk and pay these costs to the managing company? I think that we need to find a healthy balance here. What is profitable for the state, and what is not profitable. That's why it's hard, like nothing else. It has its own specifics.

Ivanna SMACHYLO I hope that we will get the final decision of the court, we will make a decision about the starting price, and as soon as possible, and we are interested in it, we will sell this asset. And the new owner will then decide how he should work with another co-owner. If we had 100% ownership, this question would have been considered from a completely different perspective. So this is about the issue that was raised.

Roman Tytikalo I would like to ask you, thank you for the frank conversation, for the frank answers. Of course, we see for what money the Hotel Dnipro, the Hotel Ukraine was sold. But I read the statistics about the sale and the number of sales of the respective assets. I understand that you calculate them in hryvnias. Did you calculate them in dollars? This is the first question. We understand that the bond of square meters usually does not take place in hryvnias, but in inflation.

Roman Tytikalo Thank you very much. Are you calculating dollars? This is one part of the question. What do you think about your top three successful objects? What will be interesting in the market next year? What should investors pay attention to? We calculate in hryvnias.

Ivanna SMACHYLO What is the advantage of the fact that all the privatization and all the rent goes through Prozorro? The advantage is that the market will still form a price. If it is increased, no one will buy it. But we see that the market actually better determines the price of one or another asset. That is why public auctions give the opportunity to sell at a real price. And we understand that even according to Hotel Ukraine, it is possible to sell a little higher.

Ivanna SMACHYLO Objectively. Regarding the cases we are preparing, on 9th of October, we hope to have a sale of GKK. We are also preparing for privatization of the same L.I.B.I.T.O. Ocean Plaza, but we are waiting for the court's decision to understand the value of this asset. Demurinskyi mining and enrichment plant. Vinnytsia-Pobudkhin also came to us. It is the so-called, if you remember, Ushat and Nyanya.

Ivanna SMACHYLO flour, soap and everything else. Quite an interesting business, we are working on it, we are trying to prepare it as soon as possible, clean it. Our task is to ensure that the buyer receives the most transparent and correct asset. Shell, we are also preparing for privatization next year. Motorbank. Therefore, there are many assets for large privatization. Large privatization does not allow us

Ivanna SMACHYLO to lower the price, so we know for sure that we will not receive less than the fixed amount, but only more. And I, with your permission, taking advantage of the fact that I still have some time, I want to share also a very good news not only for the State Property Fund, but in general for the country. Yesterday we had the first auctions for the rental of land of state property of agricultural purpose. We all know, obviously, that for years

Ivanna SMACHYLO This land was owned by the state, and now it is being used. Many oligarchs have grown on it in recent years. It was a difficult technical process, a lot of changes in legislation. Yesterday we had the first 16 auctions. We were worried about how it would be, and in fact, the auctions were fierce. Some auctions had 51 participants, the largest number.

Ivanna SMACHYLO For example, the land plot in the Vinnytsia region, the starting price is the normative price. The normative price was 450,000. There were 13 participants, if I'm not mistaken. We sold it for 300,000.

Ivanna SMACHYLO And it's not just that we sold them. Every year there will be a payment. That is, this is rent, this is permanent payments to the budget, annual payments to the budget. And we saw that, in fact, the market value of rent, even in our 16 auctions yesterday, is much higher than the statistical data.

Ivanna SMACHYLO We still have a lot of work to do. We have to release all this state land on public auctions. We saw that the majority of participants in auctions are farmers. They are not agro-holdings, they are farmers who are ready to pay a real price for the use of land.

Ivanna SMACHYLO And the process will be dynamic. By the end of the year, we will try to transfer more than 100,000 hectares to rent and continue it. But the question is that we are coming out of a valuable corruption story. And when it's a systematic thing that happened yesterday, there will be no turning back. That's why I think this is a very important case and a very important victory of our team.

Roman Tytikalo I wanted to talk about it and I see that I have enough time. I will use the moderator's rights to ask you a small question in this context. I really wanted to get interested in this. I am convinced that this is a very positive reform. Previous agreements on joint action, joint processing, this is the past. These are both risks for farmers and risks for the heads of state enterprises.

Roman Tytikalo I am very glad that this process is taking place, that these state enterprises have been transferred, that the procedures for the open transfer of the right to rent are being carried out. But, analyzing these specific auctions and these specific proposals that are being issued, I am worried as a lawyer about the purpose. Do you think you can solve this issue somehow? Because most of this land is for some scientific activity, something else. That is, the farmer takes this land,

Roman Tytikalo Most of these lands belong to some scientific institutes. They are for other purposes, not for military production. The fact is that these lands are transferred from the state-owned enterprises, which are engaged in scientific activities, especially the National Academy of Sciences,

Ivanna SMACHYL They are transferred to the Cabinet of Ministers, and now these lands that are rented are in the state enterprise, the Land Bank. That is, they no longer belong to the state enterprise. But the purpose of the land is still there. Every land plot is a work of art. Somewhere the purpose of the land is changing, somewhere it is being cleaned, somewhere there are disputes, and somewhere the opposite. That is, every land plot is an excursion.

Ivanna SMACHYLO This does not mean that we pressed a button and it flew. This means that each land plot was worked out there. And now we see that the land is being auctioned. The land that we have already prepared as much as possible. Then comes the process of daily preparation of others. And, in particular, the issue of purpose is also at work and they work with it.

Roman Tytikalo Thank you for your answer, Mrs. Ivanovna. You gave very positive examples. I hope that we have understood that the state-owned property fund, to a large extent, is the manager who brings these assets to a market condition and puts them up for sale.

Roman Tytikalo This work is really important. Preparation of the object for sale and its placement and sale for adequate and market prices is a very important work. Good luck to you in this area of work. Thank you for your participation, for taking part in this discussion. I would like to turn to the next speaker, Mr. Ivan. Accordingly, he is the head at the moment of Korodyuk Ivan Shaginovich, the head of the office of anti-raising.

Roman Tytikalo Accordingly, he is also a lawyer, an experienced lawyer from 2004, as far as I know. Accordingly, in this office of anti-raiding, he has been working for 4 years, he has great experience, great knowledge of how it happens. Therefore, I would like to give him a word, but before that, I would like to ask some questions.

Roman Tytikalo I would like to ask you to pay attention to the number of complaints. What percentage of complaints are satisfied? I noticed that before the war, the number of complaints increased with each year.

Roman Tytikalo On the 19th – 1720, on the 20th – 3000, on the 21st – 3197. In the interview, the relevant representatives of the Office for the Action of Raiders talked about the goals of the relevant groups of people who systematically engaged in raiding. Only on the previous panel they talked about the risks.

Roman Tytikalo for the foreign business that will enter Ukraine, that the law enforcement system, and some other risks, the risk of losing their assets. Therefore, the work of your office, which protects the business, including when it comes to real estate, development companies, is very important and very necessary in the creation of normal market conditions on the market.

Ivan Korodyuk Thank you for your participation. Good day to everyone. I would like to thank the organizers for the invitation and for the opportunity to provide information about the work of the Office of Protective Action of the Ministry of Justice. Before answering your questions, I would like to continue the topic of the previous speaker, which concerns the land.

Ivan Korodyuk I would like to emphasize that there is a tendency for competition between local authorities and the state.

Ivan Korodyuk The local authorities have a tendency to be independent of the region.

Ivan Korodyuk In Kyiv, this is observed the most, but in each of the regions, local authorities are trying to get, if not control, then to register these land plots as ownership of the municipal community on the basis of the law on the demarcation of land. Such complaints were also under consideration.

Ivan Korodyuk in the office of counteracted raiding, and the state property fund was also responsible for these complaints. In addition, there were complaints of the state property fund, which concerned enterprises, corporate management, including related to sub-sanctioned assets. Therefore, there is a common feature here, and in this case, the state authorities are moving in unison in order to both accumulate and return resources to the management

Ivan Korodyuk Why are we talking about land now? Because in the context of the military situation, the biggest complaint is related to land resources.

Ivan Korodyuk It does not depend on whether it is the registration of property rights or other property rights, because the biggest fight today is between, as already mentioned, agro-holdings and smaller entities that deal with the processing of land plots for the rent of these land plots. This is actually a serious asset that is making a profit to this day, so it is clear why there is a fight for it.

Ivan Korodyuk There were many such complaints as before 2022, but today this fight has become more active, of course, because a significant part of the territory of Ukraine, including agricultural fields, is in the zone of active hostilities and under occupation. Therefore, the number of lands, in general terms, which are available for processing, has, of course, decreased.

Ivan Korodyuk I remind you that the office is a department of the Ministry of Justice, which examines complaints in the sphere of state registration, in the sphere of real estate and business. That is, there is talk of registration in two registers, the State Register of Human Rights and the EDR.

Ivan Korodyuk We have a state registry of enterprises of the state organization, as well as individuals of the enterprises and public organizations. According to the statistics on the increase in the number of complaints, it would be worth to divide into several blocks. Why is this statistic changing and why was it accumulated for a certain period?

Ivan Korodyuk If we take the figures of 2021, a year before the full-scale intervention, then the total number of complaints, again, it is stated that the Ministry of Justice considers complaints according to the claim principle.

Ivan Korodyuk That is, we can assess these either raider actions or illegal actions in state registers exclusively from the point of view of the number of complaints that are addressed to us, because we cannot see the whole objective picture, because we do not have the authority to check the registers on the subject of illegal actions, both in one and in the other register. In 2021, the total number of complaints was 3,261.

Ivan Korodyuk There were 2,560 complaints against illegal activities in the register of the property. The number of complaints against illegal activities in the register of the property

Ivan Korodyuk The number of complaints in the registration of the business is much higher. If we take the proportionality, then approximately 30 to 70 are in favor of illegal actions in the register of unregistered property.

Ivan Korodyuk Starting from February 24, 2022, the Ministry of Justice, as the holder of the registers regarding the anti-raider supporters, also closed access to state registers, both real estate and EDRC.

Ivan Korodyuk It was also done on experience and until April the registries did not work. It was clear that there were no registration actions. Hence, a significant reduction in the number of complaints on the actions that took place in 2022. In addition, the colleagues of the Ministry of Justice did not work for some time.

Ivan Korodyuk He resumed his work in April 2022 and looked at the accumulated complaints that remained from 2021 or came in the first months of the year of full-scale intervention. In 2022, the number of complaints was 1,373, of which the amount was 982. Then the increase in the number of complaints begins.

Ivan Korodyuk In connection with the fact that the work of the state register was resumed, one of the obstacles that was used by the state was the limitation of access of notaries and notaries to state registers. For more than a year, not all state notaries and notaries could receive these accesses. Previous blocking and cancellation of accesses were considered, and in order to receive access, it was necessary to undergo a special procedure.

Ivan Korodyuk We can't say that it is a normal work of the economy, but there were activities in the EDR and in the register of real estate, which are related to the purchase of sales, rents, transfer of property to mortgages.

Ivan Korodyuk Due to this, the number of complaints increased, and the limitation of access was also used as a kind of a barrier from the registrars or notaries, who in the past have shown themselves, let's say, not from a very good side.

Ivan Korodyuk Next, about the number of complaints. For the first half of the year of 2024, the number of complaints in the field of illegal property in 2023 was close to 1,500.

Ivan Korodyuk In the first half of the year of 2024, the total number of complaints was 1,700, about 1,700, and the number of complaints in the sphere of state registration of unauthorized property, among them 1,360. That is, we can say that in 2024 the number of complaints to the Ministry of Justice will be the same as in the pre-war year of 2021.

Ivan Korodyuk Why such a number of changes were made to the Ministry of Justice? If we look at the previous period, it is 2019, 2020 and 2021. We can remember that these were Covid years.

Ivan Korodyuk Then, the only way to introduce changes to the normative acts of state registration were the municipal enterprises, the registrars of which carried out state registrations, and the main mass of the so-called raider actions was carried out by these state registrars. We could talk at that time about the fact that

Ivan Korodyuk Registration was carried out both in EDR and in DRP without any documents. In order to pass the functional register, it was enough to load anything near the Arcus paper. That's why, so far, there has been a cleaning of all illegal registration acts during the period of 2016-2019 and in connection with the liquidation of the ICC. Therefore, the number of complaints has constantly increased. But then there were changes in the law.

Ivan Korodyuk It is important to say that the term of complaint to the Ministry of Justice is different from what is provided in the procedural court code. There is a general term of appeal for three years. We know about the processes, independent, civil, economic. As for the complaint of registration and in the sphere of unauthorized property to the Ministry of Justice,

Ivan Korodyuk is not provided and is not limited by time. There was a short period of time when the date was set. This is a year from the moment of registration. However, changes were made to the law again, because we saw that there is a large number of property owned by state property, which were registered in the 16th, 17th, 18th years.

Ivan Korodyuk That's why we came back to the fact that it is worth removing this restriction. This period is included in the date when the victim either found out or could have found out about the illegal registration of this person.

Ivan Korodyuk can appeal to the Ministry of Justice regarding the complaint. As for the EDR, such a term in one year is preserved to this day. The terms are not distributed only in cases of violation of the sanctions legislation. That is, the relevant body that monitors and controls the order of use of sanctions does not apply to the complaint of such a body.

Ivan Korodyuk And I would like to say that the trend is changing. How does the state react? The state reacts through technical means. This is the improvement of the state register. In our case, we are talking more about the state register.

Ivan Korodyuk I can say that until 2019-2020 there were many registrations on the basis of court decisions, which simply did not exist.

Ivan Korodyuk Or the decisions of the judges were carried out, which were completely different? Or the decisions were made in detail? We do not establish details. I will tell you about what we saw in the registers. Or allegedly it exists, but there is a decision from the EDRSR or a decision in criminal case, which no one could see.

Ivan Korodyuk The state will further improve this process. Today, there is an interaction between the State Register of Human Rights and the Court Register.

Ivan Korodyuk Without cooperation, the state registrar has no right to carry out registration, without having pulled this decision from the court register. What other obstacles are used by the state? In the field of real estate, we see that, to a certain extent, the economic activity has possibly decreased. Investors want to invest money.

Ivan Korodyuk But the number of complaints in the sphere of state registration, which we appreciate, indicates that it remains at the same level. If these are not new issues, then I would say that someone wants to close his old issues. To register the objects of property, including large residential complexes, on the basis of documents that today are not provided or are not available.

Ivan Korodyuk There is also an interaction between the State Registry of Human Rights and the State Registry of Construction, which gives the possibility to sign a declaration and see whether these objects are allowed to be used.

Ivan Korodyuk The development of documentation, construction, implementation. Today it is not ideal yet, but there are recommendations of the Ministry of Internal Affairs, which allow to obtain these documents and to load them manually. If we talk about the time to introduce these documents,

Ivan Korodyuk I was surprised. It seemed that everything was built in Ukraine until 1992, because it was a special period of registration. The number of documents was not required.

Ivan Korodyuk A large number of real estate objects are trying to be registered today.

Ivan Korodyuk which do not have the relevant documents on the land plot. In order to start a large construction, you need to have land. There is a requirement of the law that the land must be owned by the future owner or the user, the legal status of the land plot on which this object is built.

Roman Tytikalo Some of them have already signed a lease agreement, some of them haven't. Some of them have numbers in their cadastre. This is not a behavior, but a violation of the law. Thank you for your answer. I have one last question for you.

Roman Tytikalo You raised a huge problem that there were not many documents, or the documents were not valid until 1991. We see that the legislation is indeed being improved. A register of court decisions is being drawn up, a register of construction activity.

Roman Tytikalo But when I look at your decisions, I see that they are not always attached to the responsibility of the registrar. When you, as the Commission, have the right to cancel a decision, you also have the right to attach it to the responsibility of the registrar, to stop all other activities. What percentage of this? And don't you see the problem in this?

Roman Tytikalo Why? Because these raider schemes are carried out by state registrars, who bring some data to the relevant register. You have a complex question. I will say that a specific sanction, which should be imposed on a state registrar for one or another offence, is not normatively established.

Ivan Korodyuk If there is a violation of the registration law by the registrar, there is always a reason to hold him accountable for blocking or canceling access to state registers. As a rule, the colleague recommends holding him accountable, although the terms of this blocking

Ivan Korodyuk There are cases in connection with changes to the registration law, when the registrar does not formally violate the registration law, but violates the general principles of state registration.

Ivan Korodyuk What does it mean? It means that as a result of the formal and legal actions of the state registrar, the state register did not respond to the reality. I will give you an example. In this case, the register is an electronic thing.

Ivan Korodyuk And by way of unauthorized access to this register, or hackers, or through phishing letters, or by way of physical access to the key of the notary or the registrar, they can enter the register and remove the burden that hindered the registration. The state registrar, by his own decision, acts absolutely legally, because nothing hinders him from registering.

Ivan Korodyuk However, when the decision of the State Registrar is complained, we cancel it, but there is no basis for the withdrawal of the State Registrar. I tried to make an analogy. This is just one of the obvious examples when we cannot draw the Registrar to responsibility.

Ivan Korodyuk According to the Fund of State Property, in this case, we have registered huge mass graves that belonged to the DPR of Ukraine in Zakarpattia, on the basis of the documents of the Ministry of Internal Affairs.

Ivan Korodyuk such registration by complaint, if I am not mistaken, of the enterprise Depelis Ukraine. In two months, a complaint comes to us again, where the registrar, on the basis of the same documents, on the basis of which there was a previous registration, again registers and does not change anything. Here, too, there is a great desire to punish this state registrar.

Ivan Korodyuk But there are different cases. Each case needs to be sorted out separately, where it applies to them, but, as a rule, these sanctions apply. Otherwise, all the registrars would get access after a full-scale invasion. I would say that there are 50 per 50. Thank you for the answer. Your work is really well done.

Roman Tytikalo In a civilized country, this should not have happened. In general, there should not have been an office against raiders. But we see the conditions, the sanctions, the Russian business, which is trying to re-register illegally.

Roman Tytikalo to remove corporate rights from the sanctions. We see your work in this direction. Thank you for the comprehensive answer. My question about the registrar was aimed only to draw attention to our subjective position that it is impossible to get rid of this phenomenon without responsibility. But you are a person who works in this direction every day. I think you understand and know this problem.

Up to 42 minutes

PART 5

Yuriy CHUMAK Ownership, land, construction is a serious problem both for the law and for the economy. Because when someone was building, there were different rules. The land plot could not be given. Then it took 10-20 years, they come and say, usually the prosecutor's office, or rather local authorities, say that this is your property, because the land plot was not given.

Yuriy CHUMAK But, in my opinion, in every such case, it is necessary to understand.

Yuriy CHUMAK For example, the contract was denied and the question arises whether it was granted when the construction began. Even worse is the situation when the lease agreement breaks and ends, and the question arises as to what was built there, but was not introduced into operation and what it is. Let's remember the most important thing, that this is a principle approved by the legislation

Yuriy CHUMAK The court practice is the unity of the land plot and the building on which it is located. This is very important to understand, because many disputes are still being resolved, for example, regarding only the land plot or the building.

Yuriy CHUMAK of the Civil Code of Ukraine. The Great Palatinate was based on the fact that in fact it is about protecting the owner of his right to the land. Therefore, to stop the right of ownership to the object that may have already been registered in the State Registry of Human Rights, to cancel state registration and so on. This is all ineffective.

Yuriy CHUMAK If you are the owner of the land and someone built something there, let's go back to what is written in 376. What do you have the right to do? You have the right to either recognize the right of ownership of this building as the owner of the land, referring to the court with such a requirement, or to demolish this building. Therefore, the Grand Chamber, having disassembled

Yuriy CHUMAK on this issue and concluded that there are two methods of protection. But as it turned out, I am criticized for criticizing the Grand Chamber, the same councils continue to address and say, well, you told us that the cancellation of state registration is ineffective and refused. And it turns out that we have made a court decision, demolished that facility,

Yuriy CHUMAK But it turned out that the record of its existence in the state registry remained, and taking into account those legal positions, which, as the Supreme Court says, are established for book ownership, it turns out that since there is registration, then there is ownership of this object, which was demolished, it is illegal. Well, state registrars

Yuriy CHUMAK who carry out the provisions of the law on the state registration of human rights, the order of registration, they say, well, you have taken the object of the decision to be taken, and we are here with what, well, we have taken it, and that's it, what are we to do? Therefore, there was a question in those councils, how they can then dispose of their land, if there is an object registered on it in the register. Another question that arose after this position

Yuriy CHUMAK The 476th Civil Code says that the person who built it should bear the blame. As a rule, the council and prosecutors give the blame not to the person who built it, but to the person who built this building.

Yuriy CHUMAK He says he doesn't know anything, there was a record in the register, the object was physically there, I bought it. The legitimacy of my actions is obvious, because it is in the register, and the information from the register appears legitimate, as long as it is not falsified.

Yuriy CHUMAK And, accordingly, I have to pay for my costs. And the case was handed over, you see now, and already on this case there is a resolution part, there is no full text yet. We also handed it over, I was there with all my colleagues, and put two pages.

Yuriy CHUMAK The first question is who should be responsible, who built it or who is the last owner. And the second question is about the state registration. As far as we understand from the resolution part, the Grand Chamber has decided that the last owner should be responsible. We will not criticize it. In principle, in the case of the civil and commercial,

Yuriy CHUMAK If you don't agree with it, it's your right. And the second point is to cancel the state registration of the right of private property by closing the relevant section. That is, in fact, the Grand Chamber somehow understood that the record that will exist for an unlimited time in some register of property rights on an object that does not exist,

Yuriy CHUMAK in some way will affect the entire land area. But we are waiting for the full text. If you are interested, write to us. You see, at 18.09 the case was resolved. Another question, in my opinion, is also interesting.

Yuriy CHUMAK about the land of the Water Fund. See, 17.09.24, I'm trying to make it more fresh for you. This is about the land of the Water Fund. Well, here you can talk for a very long time, as much as Mr. Yuriy started with this, as much as the Supreme Court expanded this explanation about the negligible claims on land that could not be removed from ownership and were not removed. You know, it all started, by the way, with the land of the Water Fund.

Yuriy CHUMAK Then there were positions on the lands of the Forest Fund, but the Grand Palace of Verkhonskoye said that the forests were in need.

Yuriy CHUMAK But then the lands of the nature reserve, historical and cultural appeared. Now, looking at the Great Palatinate, I can say that the land is iron. And then I predict that there are lands of science, especially valuable lands. And then, as they wrote in the scientific papers, the land is not a mobile property, but a resource that belongs to the entire people. In general, if it was not legal, then it did not exist.

Yuriy CHUMAK Yes, it's funny, but the prosecutors took everything seriously, and now, according to each object that has been there for 20 years, complaints are being made about the fact that they did not buy, sell, privatize, and so on, because it was a violation, so it did not happen, right? Tereshchenko's court is nearby, he is also very involved in this case, right? I said involved, right? Not a bad word, right? Super. Yes, the Great Chamber of Commerce wrote involved.

Yuriy CHUMAK I am not to blame for this. But what about the Land and Water Fund? What is the question? If you take Kyiv or any big city near the river, then there are about 10-20% of coastal protected areas.

Yuriy CHUMAK If they literally accept it, then, excuse me, Piva-Bolonia or Podola and so on will be demolished. For this, there is a city building documentation. There was a different editorial office there, which regulated the city building documentation. But you understood the main difference, if we are talking about cities. Well, first of all, the fact that there is water there is obvious. It should be taken into account.

Yuriy CHUMAK This is very obvious. Secondly, if there is no construction documentation, it does not mean that there is no position of the Land and Water Code on the land of the Water Fund. That is, we have some builders, they say that they have not developed construction documentation on this, so we built it on the shore, or the council gave it.

Yuriy CHUMAK But this is bad, wrong, because if it does not exist, then the provisions of the Water Code are used. If it exists, then local authorities have decided that certain objects can be built.

Yuriy CHUMAK There is a situation regarding the land of one fund, that is, they do not expire. There are also situations when from 10 hectares we consider 2 hectares of coastal protection. What to do with them?

Yuriy Khapko There are a lot of cases in the Supreme Court that seem to be so simple, but the land belongs to the same fund. But if 10 hectares, half a hectare of land falls into the coastal protective layer, it is possible to take it away.

Yuriy CHUMAK Are we all 10 or what? There are such questions. Now it is difficult to say how they will be resolved. In principle, I would not say. And the last thing from the interesting.

Yuriy CHUMAK You see, everything is fresh in September. The Grand Chamber withdrew from the case, sorry, from the position that was in the case, it seems, I don't remember whether it was in 2020 or 2022. Well, it's a question of bilateral restitution. Well, a certain next revolution took place, but maybe more positively than negatively, in my opinion.

Yuriy CHUMAK The double-sided restitution is mandatory again. I remember that there was such a case at the Grand Chamber in Katierynchuk's report. The Grand Chamber said that the double-sided restitution can be one-sided. And if you think so, you can continue to state that it is double-sided. Now the Grand Chamber has confirmed this in the case of Blisinforum.

Yuriy CHUMAK I don't remember, February or some month, but the bankruptcy case was published. It seems that it was only published at the beginning of the summer. And this case is also fresh. Double-sided restitution. What now? Even if the caller did not declare the use of double-sided restitution, it is applied by the court. Very briefly, so that you understand. The court said that

Yuriy CHUMAK The Supreme Court's position is that the acknowledgement of an impractical agreement, carried out or partially carried out, without declaring consequences, is ineffective. Because it does not lead to restoration. So you, as a caller, declare, or more precisely, the prosecutor,

Yuriy Khapko The court declares the use of a one-sided restitution. Give the object. What should the court do, even if you, the respondent, do not ask to return the money? The court, making a decision on the recognition of a non-actual agreement, let's not confuse it with a demand. Where is the restitution? I hope my colleagues understand the difference between the demand and the restitution. If the court recognizes a non-actual agreement, it returns the object.

Yuriy CHUMAK But at the same time, we have to make a decision to return the money. Now we are not talking about losses or other expenses that may be due to this inactivity. You can present this one to one. But now there is such a situation.

Yuriy CHUMAK On the one hand, I think that the time will end. This is a progressive position. On the other hand, as far as I understand, it will be very difficult, especially in cassation. Because now the court said that the judges should not do it in the first instance, but at the stage of cassation. Despite the fact that this object, as long as it reaches cassation, can already be sold if there is no supply. And such a situation, by the way, was.

Yuriy CHUMAK The person has already sold it and returned it to you. I sold it a year ago, and he said that he would return the money. I hope you heard something new. Thank you very much. Thank you very much.

Yuriy Khapko I have a question regarding the value of the decision. Does the Cassation Court have to order an expert assessment?

Yuriy CHUMAK As far as I understand, it is about the restitution, the return of what was received. If a land plot was sold, another property, let's say, for a million hryvnias, then the buyer is taken away from the buyer, and he is returned a million hryvnias.

Yuriy CHUMAK Inflation, 3%, losses. It is obvious that if 10 years have passed and you have been returned a million hryvnias, you can say that it is not a question, but the price of money is 3% and 625. It can be 2 million.

Yuriy Khapko Thank you for the answer.

Yuriy Khapko We had a tendency of forest, water, after that there was a cultural wasteland, now agricultural lands, which are accumulated there, more than 10 hectares, in what way they were destroyed. As for water and limited economic activity in coastal protected areas, you can follow the path that they went through the forest and said that not everything should be left, but what part. But there is a problem of who will order documents.

Yuriy Khapko And the registration basis of the DZK is probably absent, but the water fund is developing. Now we have a few claims concerning ports, ports, status of these ports, whether they are local ports, whether they are of national importance, who should be the distributor of those lands nearby, whether it is a district,

Yuriy Khapko And this is a stone, as prosecutors usually say. But the presumption is that the business is going on and the business is suffering, and we need to prove it in reverse order. For example, as for the forests, the situation is very sad, because everything there is based on planned cartographic materials of forest management. They are in paper form.

Yuriy Khapko The district office was located in the Kyiv region, in particular, it was located in Bucha. And there was a direct contact. Accordingly, they were in the same office, and we receive complaints that the land was destroyed in the 90s. The prosecutor says, prove that you had a cabin order to remove the forest.

Yuriy Khapko More than 20 years have passed, and how can we justify this position, when the owner has changed twice or thrice? The building itself was under occupation, the complex itself. Therefore, there are certain details and nuances with which it is worth dealing with, and it is necessary to remind the appropriate prosecutor's office that they usually keep us in tune, give us work, we are grateful to you for this.

Yuriy Khapko Every year it gets more and more interesting, especially from the Prosecutor General's Office, when we start to deal with archaeological monuments. We want to understand the boundaries of this archaeological monument, where these excavations should be. The Institute of Archaeology says, you don't understand, it's everywhere.

Yuriy Khapko Starting with the Bronze Age, Paleolithic and ending with Prince Oleg. It is quite interesting and in fact there are experts who could establish it. People, experts in certain areas, their individuals in the country. I say in fact, for example, in the culture department there are two specialists for the whole country and one of them is fighting.

Yuriy Khapko And one specialist works in Bakarios and in Knyse in Kyiv. And who was the first to do an expertise, for example, some prerogatives. But still, I would like to give the floor to the representative of the Office of the Prosecutor General. You are generating all this. Please share how you are going to protect

Yuriy Khapko What are the interests of the state in the field of urban development and land relations? What will be interesting or what is already interesting? Natalia Vasylenko, please.

Natalia VASILENKO I am very sorry, in fact, that the legal community sees the prosecutor as such a heavenly evil, whose activity is aimed at something bad. I want to assure you all, and in fact, you can look at the register of court decisions, the entire activity of the prosecutor is very transparent, clear and open. From the moment the prosecutor sends a appeal to court, any person, whether it is an advocate or an ordinary citizen, can see what the prosecutor is doing, what appeals he is submitting.

Natalia VASILENKO We also have 99% open processes, so you can come and listen to what position the prosecutor is in. And the prosecutor is not engaged in the revision of some old legal relations in order to somehow hurt someone's rights. Certainly, all the same, the parents of the Constitution, those who wrote it, indirectly provided such a constitutional function.

Natalia VASILENKO to protect the interests of the state in court, so that this function is like the function of the last hope, so that these interests of the state are still protected. If the legal community says that everything is more difficult for you, then this is a recognition that we should at least try to fulfill our function and protect the good interests of the state in court.

Natalia VASILENKO Thanks to our appeals, the interests of the state are somehow managed to protect. The objects that you are talking about are the ones that have been removed from circulation. I would like to inform you that this is not some prosecutor's blunder.

Natalia VASILENKO I am very sorry that the Constitution is based on the perception of its norms, direct, mandatory for everyone, for any citizen, for any lawyer, for the court, for everyone, as declarative. We have a right to the land and, limited in turn, the regime is not another element of constitutional order, and therefore it must be protected.

Natalia VASILENKO Let's start from the basis. Triad, state sovereignty, land sovereignty, food sovereignty. These are all elements of the constitution law. This is not a base, but unfortunately, the perception. We have the protection of the land in Article 13 of the Constitution. This is all the right of the Ukrainian people.

Natalia VASILENKO That is why the issue of sovereignty, that is why it is a separate subject of property rights. And the authorities that carry out the order of this land area must act within the limits and in the way set by the law. And we are talking, if we talk about these objects, forests, protected areas and all categories of land that are taken from the circulation, they are taken in order to ensure sovereignty.

Natalia VASILENKO and ensure that there is a basis for the coexistence of a person, to carry out historical monuments and cultural values at all levels of the state as a component of national security. The Ministry of Culture and the representative in our room will confirm that they have proposed a fourth component of national security. The Constitution of Ukraine guarantees that the state protects the lives of people. The use of property cannot harm and so on.

Natalia VASILENKO We have a lot of decisions, I did not bring them all on the screen, because there are actually many of them. This is the duty of the state.

Natalia VASILENKO There are restrictions in civil law and the law of protection. This is also a very large number of norms and laws. And it is not for nothing. I will now read it to you. I understand that I have a lot of time. But I would like to point out to you that this is not just a matter of revisions and revisions of business. This is a matter of our life and activities, the functioning of the state as a legal one, and the performance of its constitutional function as a state, as a state body for the protection of human rights. Because, in fact, the interest of the state is no longer something illusory.

Natalia VASILENKO When there was a question of the prosecutor's authority, what is the interest of the state, we gave a lot of conclusions about the interests of the state.

Natalia VASILENKO of a specific person, society, public interest, and this all makes up the interest of the state. And our claims are aimed at protecting this interest of the state. And I showed you that restrictions and regimes are set by specific norms. There are specific examples on the QR, either court decisions or the stories that we filmed, they will simply show a more extensive example. For example, let's take the energy sector.

Natalia VASILENKO We had a court dispute, it came to the Supreme Court, a concrete example, where there is a gas pipeline network under strong pressure. Above this network, they built a rest complex with manholes, that is, absolutely dangerous activity with a large crowd of people. The prosecutor won this lawsuit and today a decision will be made to demolish all these facilities. Of course, this is an intervention into a specific law.

Natalia VASILENKO Is it justified? Of course, it is justified. If the gas pipeline is torn down and a large number of people who live in this pension will die, then the state should have prevented it. There are no such people at the moment, but if there are, it will be the life and health of the people above.

Natalia VASILENKO and suffer from the activities that are illegal on such a land plot. Therefore, I give an example that these restrictions are not accidental. The legislator therefore establishes these restrictions in order to ensure the constitutional rights and freedoms of citizens. The next category is

Natalia VASILENKO Land transport is also an example when land is transferred around airports and other facilities. And here I have a novel about the consequences, about the fact that planes fell, some parts, and what were the negative consequences for the land. Therefore, if it is not possible to build there,

Natalia VASILENKO This is provided by the law for specific purposes. Those categories of land must be protected. If a business wants to carry out legal and legal activities, it must conduct an audit of that land area in order to prevent unnecessary disputes and costs. In any case, we will hope that the law will still be on the side of the state.

Natalia VASILENKO For example, if we talk about the land of the Academy, then I would like to draw attention to the fact that especially those people who stayed in our Academy of Sciences, members of the correspondents of the Sciences, with whom we communicate, and we define for ourselves what is the social interest of the Academy, they clearly explain, for example, the land of the Academy, those who are concerned with agricultural land, we are a food country, the land of the Academy,

Natalia VASILENKO They are also used to ensure the scientific potential of the country. If we, as an agricultural country, do not grow our own grain, our own agricultural material, we will be dependent on external supply. External supply, as we can see, in the context of a war, can be anything. Reduction of supplies literally per month, and we do not carry out sowing. In order for this crop of the country to be high, we must have our own agricultural material,

Natalia VASILENKO It will provide us with quality seed material, considering our climate, our pests and so on. Therefore, given the importance of the agricultural business, this business must be provided with seed material. Therefore, we do not need to cut the juice on the tree where we sit.

Natalia VASILENKO For example, the National Academy of Sciences of Ukraine has specific institutes in its part. When cities or settlements are being developed, they try to cut off pieces of the academy's land in order to build it. As a result, the area where scientific research is carried out decreases, and we undermine the base that the state has provided for the academy to ensure the scientific development of this area.

Natalia VASILENKO There were cases when it was used by institutions directly engaged in defense. For example, the land of the Paton Electrode Institute. In general, it is dangerous to even assume that these land areas, which were illegally mined by local self-government, beyond the boundaries of the authorities, the method is established, they are directly forbidden by law. People who are building there, they will

Natalia VASILENKO They are constantly at the risk that the tests conducted by the institutes of the Academy of Sciences will be at the risk that something will break there. Therefore, this is not only a question of scientific potential, but also of the security of the settlement, which is developing and distributing land in an illegal way for people.

Natalia VASILENKO As a society, as a legal community, we must look at the problems from this side and understand that if we want a legal state, we must act in a legal and legal way.

Natalia VASILENKO There is a position of the Supreme Court, thank God, that these are objects taken out of circulation. There are direct prohibitions in the law on the transfer to private property, respectively, to ensure the protection of the environment, to ensure the rights of people.

Natalia VASILENKO In fact, the property owner of this land is not a specific local self-government body, but the people of Ukraine.

Natalia VASILENKO It is a practice that they are the ones who do not go out of the loop, because the norm of the law is always such that it dominates over the specific decision of the body. If it is taken out of the loop, then it cannot be introduced into the loop by a specific decision of the local self-government body. This decision, in its own nature, does not meet the requirements of the legislature, because the law determines the legal status and ownership of this object. This has become a practice. The QR code is shown by the Natural Resources Fund.

Natalia VASILENKO and parks and squares. A separate direction is what we have taken into our work, which we have been working on in recent years. This is the protection of cultural heritage, art institutions, state enterprises from this category. Because often these objects are

Natalia VASILENKO These are objects in the field of vision of people who want to develop the city and at the same time they become objects of illegal exclusion in different ways, in different schemes.

Natalia VASILENKO This is an example of how the Grand Chamber of Commerce defines what cultural heritage objects are for us and why we keep them. Why is it a matter of national security? There is an understanding in this sense, thank God.

Natalia VASILENKO The court of Tereshchenko. This object was in moratorium and once it was taken out of circulation, it could not be in circulation. I would like to draw your attention to the fact that there was no legal procurement here. It was a scheme in exchange for the concept of an investment agreement with certain changes to the item.

Natalia VASILENKO And with the payment of money. That is, there was no legal way of privatization. In fact, we have an old decision of the Constitutional Court of 2009, which states that all property, state and municipal, can be removed in a legal way only in two ways. This is privatization, not privatization, but there are absolutely other objects that are regulated by other norms of the law. That is, the removal of property can take place on privatization competition grounds.

Natalia VASILENKO The way of expropriation is completely different. When there is a privatization way of expropriation, I am talking about something else. This object could not be expropriated. There was a moratorium at that time. Privatization expropriation is the possibility of involving all participants. This is the most investment-intuitive involvement for the state of the buyer who will develop this object.

Natalia VASILENKO which will offer the best conditions for the development of a specific factory or cultural heritage site, which will pay the highest price, and this money will go to the budget for the implementation of specific programs that are laid out by the budget, whether local or state. That is why the legislator has decided on this method of eviction of property. There is an interest here, because

Natalia VASILENKO In this way, the balance of those who buy, because they have access to the privatization processes, and the best involvement of those who will develop. And when there is a privatization agreement, specific conditions are written out in it.

Natalia VASILENKO The privatization agreement is not just a purchase and sale agreement. I bought and forgot. The privatization agreement provides for the obligation to the state to maintain the profile of the enterprise, develop it, and so on.

Natalia VASILENKO The purpose of what we brought to the court is that this object was planned to be demolished. It is historically important, it is a monument. The owner for 20 years did not take any measures to restore it. He brought it to a critically poor state and the projects he promoted were those to demolish it and build a commercial facility.

Natalia VASILENKO Therefore, I think we are doubtful that it is necessary to protect such objects, to follow the procedures, rules and interests of the state that everyone is interested in, including business. Here is an example of an archaeology position.

Natalia VASILENKO We are a country that has incredible archaeological monuments. The question is why there are no monuments in the state catastrophe of specific areas. This is a question for the bodies that should govern in this area.

Natalia VASILENKO But I would like to make sure that each monument has an appropriate passport, has specific cartographic materials. And in fact, it is well studied by the Institute of Archaeology. The Institute of Archaeology is an academic institute that has a certain set of knowledge. And they know exactly where the cultural sphere is. The law refers to the cultural sphere as a specific understanding of where the monument is located. And it is recorded in

Natalia VASILENKO That is, it is not a big problem to install a monument somewhere within the limits of this monument.

Natalia VASILENKO And the position of the Grand Palace speaks of the fact that with the calculation of such materials, there is already a position formed, because archaeology has been taken out of circulation. And it cannot dominate how many examples of discoveries and discoveries we have discovered over the last years of research of what was happening on the terrain of this land. It is certainly a dominant interest to destroy these monuments and to destroy or build them. Here is an example of one of the methods

Natalia VASILENKO which managed to protect the interests of the state, is to withdraw the memorandum in the form of a complaint on the basis of formal reasons for deprivation of the regime and the status of the memorandum. There are specific positions of the Supreme Court, which have determined the criteria for the fact that the violation of the procedure of acceptance cannot testify to the immorality of the remittance and other reasons. Therefore, to this day, we see from the monitoring that

Natalia VASILENKO Attempts and attempts to deprive the monument of its status, to demolish it, are much less than it was literally two years ago. Therefore, it is thanks to such legal positions of the Supreme Court that the implementation of the 54th Constitution of Ukraine is ensured. The Constitution of Ukraine says that the state ensures. This is imperative. It is thanks to the Constitution of the Supreme Court that we ensure.

Natalia VASILENKO Great. Thank you very much. I have a few remarks, but before that I will start ... I'm not finishing, right? Well, let me read it. Give me two more minutes. Okay, good luck. Considering that I am one opponent, and everyone is against, so give me a little more time. No, we are not opponents, we are looking for a communist.

Natalia VASILENKO I understand that everyone will be against me, so I will continue. Here is an example of the illegal scheme of the withdrawal of the land and the establishment of the so-called joint activities agreements.

Natalia VASILENKO On the one hand, the one who suffered in the hands of the business, set an agreement with which he supposedly conducts restoration work of the Ukrainian Kinochronika. Accordingly, under these contractual conditions, they build a housing complex, destroy the communications of the Karpenko-Karlo University, build a housing complex there, in addition to any normal conditions under which they had to do something for

Natalia VASILENKO The conditions are not provided by the University of Kinokhroniki. With the consideration of these legal relations, I think you are all mature and intelligent lawyers, you understand that the buildings will be built, the communications will be destroyed, and on the other hand, under such conditions, no one will ever do anything.

Natalia VASILENKO It is a direct ban on construction in such territories. It caused a great resonance for the Karpenko-Karovo University itself. Half of the university came to the meeting. They were very angry with their institution. They understood what would happen when the premises where they were shooting movies were destroyed. It was important for these children. It is important to see that the state is just, to see that we have a right and that the interests of the state are protected.

Natalia VASILENKO Here is an example of insubordination, displayed on the screen. This is about the law and about the revision that we have been doing in recent years. A park with specific signs, with an understanding of where this park is located, where the locals go.

Natalia VASILENKO A person who owns a land plot next to the park is privatized. As soon as a criminal case is filed, the land plot is sold to the person who owns the plot and forms it as a separate object of civil rights.

Natalia VASILENKO This is about good conscience. In fact, the Convention on the Protection of Human Rights and Fundamental Freedoms and the ESPL say that the intervention of the state is justified when there is a public interest. I would like to draw your attention to the consequences. We cooperate with hydrogeologists, we invite them to our seminars, we try to draw good conclusions about the consequences of such activities. They are displayed on the screen.

Natalia VASILENKO And hydrologists beat on the floor, because no one, when conducting construction within the limits of the city, does not study hydrogeology. From the position of hydrologists, you cannot take, for example, a river to cover all these tributaries, which will not go anywhere. And if you built something in one place, the water will always find a way out and flood the basements of other buildings. And this is not about the public interest, it is about the interest of each of us, because at some stage they will flood your basements.

Natalia VASILENKO Or your houses will start to be destroyed, or rivers will dry up around, because at some stage there will be very negative consequences. Invite hydrologists to such presentations, you will understand about the consequences and the Academy of Sciences of their representatives. Here are examples of the destruction, how the houses drove, how the roads drove, including in Ukraine, because the hydrology of Suva was not taken into account, as well as the places of construction.

Natalia VASILENKO And the reaction of people, because this is the place of their life and activity. Citizens come to many of our cases, because this is the place of their environment of existence. And they perceive us all as a state that is responsible for them.

Natalia VASILENKO so that their environment is suitable for living, so that there are schools, so that there is greenery, so that there is a low temperature and the possibility of living, so that their children have somewhere to walk, so that their houses do not collapse, do not flood with water. Thank you for your attention.

Yuriy Khapko Thank you very much. In fact, I am grateful to you that you raised such a number of questions, such a layer of questions. After the 10th point, I have already stopped fixing my remarks in order not to take away the colleagues' time. If you can take out my presentation, I would also like to draw attention to some moments. This story, you say, the scheme, it is always, in my opinion, somewhere on some border lines.

Yuriy Khapko It seems that the forest, the cadastre and the number are not formed. It seems that the monument of archeology has no passport. There is also no border of the monument. It is not that the business wants to take it completely, to build it. The business wants to understand, as the representative of the Supreme Court said, there is unity and rules. So that he did not start ... He signed an

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