Under the law of Ukraine “On Property” foreign legal entities and individuals have the same rights as Ukrainian citizens to purchase, own and dispose of real estate assets within Ukraine.
In order to enter into a sale-purchase agreement, a foreign individual needs to have the following documents:
-
passport with a valid visa;
- tax payer number on the territory of Ukraine (which is obtained at the regional Tax Administration).
Foreign legal entities have to submit the following documents with certified translations into the Ukrainian language:
-
a copy of the foundation documents (charter, memorandum, articles of association);
- a resolution on the appointment of the legal entity’s official who has signatory authority or other document that confirms the authority of the legal entity’s representative.
The legal entity entering a sale-purchase agreement needs also to have its stamp.
The Civil Code of Ukraine (effective as of 1 January,2004) states that all real estate contracts for purchase and sale are to be subject to notary certification and public registration. Its Article 657 stipulates that a contract for purchase and sale of a land plot, an integral property complex, a residential house (apartment) or other real property must be executed in writing, certified by a notary and registered at the state register.
The Civil Code does not envisage exceptions allowing entities to execute real estate purchase contracts without notarization. However, the New Civil Code does not solve the title registration problem completely. A purchase agreement will have to be notarized and registered but certain period of time is required to register such a contract and the transfer of title. An unscrupulous seller may still, using duplicate title documents, sell the same real estate to other buyers over a period of several days and arrange it before the first sale appears publicly in the registry. Therefore, in order to minimize this risk, a purchaser needs to apply for registration of the purchase contract immediately after the execution of the contract. Of course it’s better to stipulate that full payment is made only after the registration.
The state registration of a real estate agreement is performed by a notary who must submit the necessary information regarding the very agreement to the State registry of agreements computer system. If an agreement on alienation of property must be registered, then, a purchaser acquires the title to such property as of the moment of registration which is carried out by the State Real Estate Ownership Rights Register (BTI). After registration of the title to the real estate with the BTI the buyer obtains a registration number and an appropriate certificate or stamp on the contract for purchase and sale. From that moment the documentation formalities are completed.
One should also pay attention to the state duties stipulated by the law of Ukraine. After a notary certifies a real estate agreement of purchase and sale, the parties must pay state duties usually paid directly to the notary during the transaction. The above-mentioned expenses are usually shared equally between the parties. However, the parties may agree alternatively to split the expenses. In this case this change should be stated in the contract for purchase and sale.
The above is intended to provide a brief guide only. It is essential that appropriate professional advice is obtained. Our company will be glad to assist you in this respect.
Please do not hesitate to contact us.
