Ukraine: New rules for the use of water bodies and underlying land

On 30 November 2020, the President of Ukraine signed the Law of Ukraine "On Amendments to Certain Ukrainian Legislation Related to Clarification of the Procedure for Leasing Water Bodies together with Land Plots" ("Law"). The Law will take effect three months after the date of its publication (save for its certain provisions).
 

Highlights

• The Law amends the Water Code of Ukraine, the Law of Ukraine "On Land Lease" and some other laws.
• The Law aims to unify the procedure for formalization of the right to use a water body (lake, pond, canal, river, etc.). Currently, the legislation provides that this right can be formalized by concluding a water fund land lease agreement or a water body lease agreement.
• For new users of water bodies, the Law provides for the conclusion of a single "lease agreement in respect of land together with a water body thereon" ("Agreement") and authorizes the Cabinet of Ministers of Ukraine to approve a model Agreement.

Detailed overview

The Law provides for the following:

• The Agreement will be the only basis for leasing a water body. The right to lease land under the Agreement will also apply to a water body located on it.
• The sublease of a land plot together with a water body located on it will be prohibited.
• The lessee must permit special water use by third parties (except for cases when it prevents the lessee from using a water body for the purposes specified in the Agreement).
• The Agreement must specify, in particular, the volume and area of a water body (water area) and the amount of the rental fee for the use of the water body.

Lease agreements in respect of water bodies concluded before the entry into force of the Law will continue to operate under the terms and conditions provided in the agreements. As soon as they expire, the right to lease water bodies can be registered by concluding the Agreement.

Parties to lease agreements in respect of water bodies/underlying land plots that do not specify the terms regarding the amount of the rental fee for the use of the land plot/water body and that were concluded before the entry into force of the Law must specify such terms within one year after the entry into force of the Law.