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. Last Updated: 07/27/2016

Duma Takes Up Kremlin's Land Bill

Lawmakers will consider on first reading Friday a Kremlin-approved Land Code that opponents say will allow a handful of people to snap up 98 percent of the country's land, including farm plots.

The Kremlin and other supporters of the code say the economy will remain mired in stagnation if legislation is not approved regulating the ownership of land.

The Land Code going before the State Duma on Friday opens the door to the sale of commercial and private land to Russian and foreign nationals and sets no limit to the amount of land that can be owned by individuals and companies, according to Duma deputies.

The draft code, drawn up by a team led by Economic Development and Trade Minister German Gref, bars the privatization of nature reserves and land occupied by defense and nuclear facilities, lawmakers said. Limited would be the sale of land under existing structures such as docks and railroad stations.

The draft does not authorize or ban the sale of agricultural land, stating only that such sales will be regulated by a special law and that each region will handle them under its own legislation.

The draft's failure to specifically exclude the sale of farmland raised the ire of Communists and other nationalist lawmakers on the eve of the Friday hearing. They fear that the vast agricultural lands will be sold off much like the infamous sell-offs of the 1990s under privatization guru Anatoly Chubais that saw prime state assets snapped up by a handful of politically connected insiders.

"Privatization according to Chubais made us poor, but we will turn into slaves if we pass the code drafted by Gref," Nikolai Kharitonov, head of the Agrarian-Industrial bloc in the Duma, told agricultural producers in Nizhny Novgorod last week.

The issue of farmland is so controversial that it has stalled previous versions of the Land Code sent to the Duma over the past seven years. The latest version the Duma passed in all three required hearings was heard in 1998 but never signed into law by then-President Boris Yeltsin.

The Duma will have to vote to scrap the 1998 legislation before it can take up the new code Friday, said Duma Speaker Gennady Seleznyov, a Communist, on Thursday.

But with the parliament dominated by liberal and pro-Kremlin factions, the vote should be nothing more than a formality.

President Vladimir Putin ran into the farmland barrier earlier this year when he ordered the government to tackle land reforms. In a bid to get at least some land ownership legislation into the books, he moved to appease nationalists by agreeing to drop the matter of agricultural lands from the Land Code and address it in a separate law.

"We agreed that the code will exclude the part about the sale of agricultural land," Communist Party head Gennady Zyuganov said in an interview with Ekho Moskvy radio last week. "But when the code was provided to the State Duma [in late May], quite a few articles had been rewritten and now, according to this code, 98 percent of the country could be sold off."

"The problem is that the draft opens a door, gives a loophole, that could be widened later," Kharitonov said.

Communists and Agrarians are also up in arms about the provisions in the code that allow land to be owned by foreigners and that it can be sold in unlimited quantities.

Seventeen regions including Saratov and Samara have passed laws allowing the sale of agriculture land. But the market, in the absence of a Land Code, has developed very slowly because buyers are afraid they will lose their plots if a code is passed banning land sales.

Sergei Levochsky, spokesman for the Duma's property committee, which is in charge of the Land Code, said his committee has received a number of protests about the draft.

"It will be heavily amended after the first hearing," he said.

The final version passed by the Duma will still allow foreigners to buy land, "but not everywhere and not by all foreigners," Levochsky said, without elaborating.

"And in some regions they will only get the right to rent land," he said.

Levochsky said expert studies conducted for his committee found that the absence of a Land Code has led to an enormous black market for land.

"There is an illegal criminal turnover of land that is not regulated by the state or municipal bodies. In the Moscow region, the criminalization of this market is enormous," he said, quoting a report prepared by Grigory Bystrov, a scholar with the Moscow State Legal Academy and vice president of the European Academy of Agrarian Law.

"Instead of forming a strong municipal budget out of the profits of legal land sales and building houses and infrastructure, the State Duma for many years has been involved in idle discussions about whether land must be sold in Russia," the report states.

If the Duma gives the go-ahead to the Land Code in first reading Friday, the legislation will have to be passed in two more readings before it can be sent to the Federation Council for approval. Then the code goes to Putin for his signature putting it into law.

The Duma on Friday may consider alternatives to the Land Code put together by the government. The shelved 1998 code may be pushed forward by nationalists, as may be a draft penned by the liberal Union of Right Forces faction.

The Duma voted Thursday to move up the first hearing of the code from the end of June. Nationalists complained that the government was trying to prevent them from collecting enough support against the code from regional legislative assemblies.

"The deadline for the regions' responses was this Friday," said Mikhail Silvanovich, spokesman for Agrarian Party leader Mikhail Lapshin, in a telephone interview Thursday. "But the Duma decided to hold an extraordinary hearing Friday to push the first reading through quickly, before we could gather all the opinions of the regions."

Lapshin said in a statement Thursday that Land Code opponents need the backing of at least 30 regions to prevent the legislation from being passed.

"If the State Duma receives negative opinions from no less than 30 regional legislative assemblies before the second reading, we will win the battle for Russia's land," Lapshin said.