Law on Counteracting Raiding Has Been Adopted: What Regultions Are Stipulated For

The Parliament has recently adopted the Law of Ukraine “On Amendments to Certain Laws of Ukraine on Improving the Mechanism of Counteracting Raiding” (No. 2255IX of May 12, 2022). Consideration of the Draft Law began in 2021, then for a long time it was being improved, and has finally been adopted as a whole. The law is aimed at preventing abuses in the field of state registration and improving legal mechanisms for the protection of persons whose rights have been violated. Below, we are considering its main provisions.

1. Changes concerning business entities:

1) Peculiarities of signing the protocol on the appointment of the director of the limited liability company have been established

The protocol containing information on the decision to change the head of the company, if no more than 10 people’s votes are needed to make such a decision, is signed by the participants (their representatives) who voted for such a decision and whose votes are enough to make a decision, unless otherwise provided by the company’s charter.

2) The list of significant transactions has been supplemented

The transaction on termination of the lease (sublease) agreement of agricultural land, the lessee (subleaser) of which is a legal entity of private law (except for joint stock companies, general and limited partnerships), is a significant transaction and requires prior adoption by the general meeting or other higher body of such legal the person’s decision to consent to its commission (unless the charter of the legal entity expressly provides that such a transaction is not significant). In the case of non-decision to grant consent (unless the charter of the legal entity expressly provides that such a transaction is not significant), such a transaction is void.

2) The mechanism for appealing decisions in the field of state registration has been improved by amending the Laws of Ukraine “On State Registration of Real Property Rights and Encumbrances” and “On State Registration of Legal Entities, Individual Entrepreneurs and Public Associations”.– 

1) It has been determined that the Ministry of Justice considers:

– complaints against the decision of the state registrar on state registration of rights;

– complaints against decisions, actions or inaction of territorial bodies of the Ministry of Justice of Ukraine;

– notices of the state registrar about the fact discovered by them of the use of their identifiers of access to the State Register of Rights by other persons.

When reviewing a complaint against decisions, actions or inaction of territorial bodies of the Ministry of Justice of Ukraine, compliance with the legislation in the field of state registration of decisions, actions or inaction of the state registrar, the subject of state registration of rights appealed to the relevant territorial body.

2) Deadlines for complaints have been prolonged, namely:

– decisions, actions or inaction of the state registrar, subject of state registration of rights may be appealed to the Ministry of Justice of Ukraine, its territorial bodies by the person whose rights have been violated, within two months from the date when the person learned or could have learned about the violation no later than one year from the date of the relevant decision, action or inaction;

– decisions, actions or inaction of territorial bodies of the Ministry of Justice of Ukraine may be appealed to the Ministry of Justice of Ukraine within one month from the day when the person learned or could have learned about the violation of their rights, but not later than six months from the date of the decision, action or inaction.

3) The deadline for consideration of complaints has been established

Complaints shall be considered within one month from the date of receipt.

If it is impossible to consider a complaint against decisions, actions or inaction in the field of state registration of rights within a month, the Ministry of Justice of Ukraine and its territorial bodies shall set the necessary deadline for its consideration, which shall be notified to the complainant. In this case, the total period for resolving the issues raised in the complaint may not exceed 45 days.

4) Based on the results of the complaint consideration, decisions may be made:

– on satisfaction of the complaint (if the appealed decisions, actions or inaction do not comply with the legislation in the field of state registration of rights). In this case, the decision states: to cancel of the decision of the state registrar, cancel the decision of the territorial body of the Ministry of Justice of Ukraine or correct a technical error made by the state registrar, or the obligation of the state registrar to correct a technical error of the state registration of rights to eliminate the violations committed by them with determination of terms of performance of such obligation. It may also be decided to bring to disciplinary responsibility an official of the territorial body of the Ministry of Justice of Ukraine or to send to the High Qualification Commission of Notaries under the Ministry of Justice of Ukraine a petition to revoke the certificate of the right to engage in notarial activities;

– on refusal to satisfy the complaint (if the appealed decisions, actions or inaction comply with the legislation in the field of state registration of rights);

– on leaving the complaint without consideration on the merits (in particular, failure to comply with the deadline for filing a complaint, the availability of a decision on the same issue, available information on the complainant’s application on the same issue, the complaint filed by an unauthorized person, etc.).

It has been established that the procedure for considering complaints against decisions, actions or inaction of the state registrar, subjects of state registration of rights, territorial bodies of the Ministry of Justice of Ukraine is determined by the Cabinet of Ministers of Ukraine.

5) The obligation of subjects to provide information at the request of the state registrar has been established

The Law of Ukraine “On State Registration of Real Rights to Immovable Property and Their Encumbrances” stated that during the state registration of rights arising in the manner prescribed by law   Before January 1, 2013, as well as during the state registration of acquired rights on rights arising in the manner prescribed by law before January 1, 2013, the state registrar shall request from the authorities, enterprises, institutions and organizations that, in accordance with the law, carried out the registration and/or registration of rights, information (certificates certified in the manner prescribed by law, copies of documents, etc.) necessary for such registration, in the absence of access to relevant media containing information necessary for state registration of rights, or in the absence of necessary information in the unified and state registers, and/or if the relevant documents have not been submitted by the applicant. This does not apply to the cases where the state registration of the rights derived from the right of ownership is carried out in connection with the commission of a notarial act, and such documents were provided in connection with the commission of such an act.

From now on, the Law has been amended to define the obligation of public authorities, enterprises, institutions and organizations no later than three working days from the date of receipt of the request of the state registrar to provide the requested information free of charge  in paper and (if possible) electronic form. Persons guilty of violating the deadline for providing information at the request of the state registrar are administratively liable.

6) The order of actions of the state registrar in case of detection of the fact of possible unauthorized access to registers has been defined

The state registrar, in case they discover the fact of using their access identifiers to the State Register of Rights by others, shall immediately, but not later than the next working day, notify the Ministry of Justice of Ukraine of this fact and all known decisions (actions) in the State Register of Rights accepted (carried out) with the misuse of such identifiers.

The provisions of the Law, with some exceptions, will enter into force two months after its publication.