REALWorld Law

Sale and purchase

Ownership restrictions

Are there any legal restrictions on foreign investors acquiring real estate?



Ukrainian law allows foreigners to own real estate in Ukraine but there are a number of important restrictions that may apply. The Land Code of Ukraine prohibits foreigners, foreign companies and foreign countries from owning agricultural land in Ukraine. It also precludes foreign companies from purchasing plots of land other than:

  • plots of land located inside the boundaries of populated areas in the case of the acquisition of real estate facilities located there or for the purpose of constructing facilities related to their (the foreign buyer's) commercial activities in Ukraine; and
  • plots of land outside the boundaries of populated areas where the plot of land underlies a building or structure owned by the buyer

These restrictions also apply to joint ventures, ie companies established under Ukrainian law with the participation of foreign investors and Ukrainian legal entities and/or individuals.

It should be noted that on 31 March 2020 the Law of Ukraine "On amending some legislative acts of Ukraine regarding conditions of the agricultural land circulation" was passed. The respective law allows foreigners to purchase and own agricultural land only subject to the consent provided by Ukrainian people in a national referendum.

A number of other limitations exist under the Land Code, especially with respect to agricultural land.

The procedure for the purchase of land by foreigners can be complicated. In order to purchase land in Ukraine, a foreign company must act either through a subsidiary or a permanent establishment with the right to carry on business activity in Ukraine. A municipal plot of land may be sold to a foreign company with the approval of the Ukrainian Cabinet. Land owned by the Ukrainian state may only be sold to a foreign company subject to approval by the Ukrainian Parliament.

The acquisition of land by Ukrainian subsidiaries of foreign companies is even more problematic because the relevant provisions are not properly drafted. On the one hand, there are clarifications of the State Agency for Land Resources and court decisions stating that the acquisition of plots of land by Ukrainian companies that are 100% foreign owned is not provided for by Ukrainian law. On the other hand, there are court decisions stating that such companies should be allowed to acquire non-agricultural land in Ukraine.

There are other restrictions on the sale and purchase of real estate as well as the disposal of certain types of land by other means.