30.10.2013. Today, the Support Economic Initiatives (SEI) Public Union organized a roundtable discussion on "Problems of land ownership legislation in Azerbaijan" within the project of "Support to Small Business Development in Azerbaijan" implemented with the financial support of the USAID.
The discussion was attended by representatives of government agencies and international organizations, parliamentarians, entrepreneurs, independent experts and representatives of local NGOs.
Opening the event, the head of the SEI Public Union Azer Mehdiyev said that one of the important directions in reducing the country's dependence on oil and the implementation of economic diversification policy is to ensure the systematic development of agricultural production. It is very important to improve the legislation in the field of land ownership for the free introduction of agricultural lands into economic circulation and the formation of the land market in the country. Azerbaijan is considered to be one of the countries in the post-Soviet space where land reform is carried out faster and faster. According to official data, 4.8 million hectares (55.8 percent) of the 8.6 million hectares of land that make up the unified land fund of Azerbaijan are suitable for agriculture. 1.35 million hectares (28.1 percent) of agricultural land have been privatized and given directly to farmers. However, research conducted by the Public Association for Support of Economic Initiatives shows that there are still a number of problems in the country that hinder the free exercise of property rights on agricultural land. A.Mehtiyev said that in order to develop proposals and recommendations to solve the problem, a study on "Problems in the registration of farmland and ways to overcome them" was conducted within the project "Support to Small Business Development" supported by the US IDA. At today's round table, the results of that research and the recommendations prepared are presented to you. An improved version of the study and recommendations will be submitted to the government, taking into account the suggestions made here.
Welcoming the participants, the head of the Entrepreneurship Development Foundation Sabit Bagirov informed about the activities and research carried out within the "Support to Small Business Development" project. He noted that the problems of land ownership legislation create serious obstacles to the activities of entrepreneurs and farmers working in agriculture. He noted that such research aims to help solve the problem.
Then, Samir Aliyev, an expert of the Support Economic Initiatives, the author of the study, made a presentation on "Problems in the registration of farmland and ways to overcome them."
In his speech, the speaker said that the government, which prioritizes economic diversification in the country, must also ensure the formation of a land market for agricultural development. The formation of this market is directly related to the improvement of registration of farmland, the simplification of complex procedures.
According to the Land Code, land is transferred to private ownership to citizens and legal entities. Foreigners and stateless persons, foreign legal entities, may acquire land plots only on the basis of lease rights. Privately owned land is sold or leased directly, while state and municipal land is sold or leased through auctions and competitions.
The study found that the complex procedures that exist in both the sale and lease of shared land and the sale and lease of municipal land make the work of farmers much more difficult. Farmers face a waste of time and additional costs. Problems are manifested both at the stage of land sales and at the stage of registration in the state register after the sale. Problems in the land sale phase have a negative impact on the land registration process. Lack of acts issued by the state for the recognition of municipal land, improper adherence to inheritance procedures in case of death of the land owner, lack of relevant documents confirming private property, etc. Such cases create problems for the farmer who owns the land in the registration of the land. As a result, in some cases, privately owned land is leased on the basis of informal, "gentlemanly agreements." This frees farmers from wasting extra time and money.
The main dissatisfaction of farmers and municipalities with land ownership is related to the activities of the Real Estate Registry Service (SRRS). For the land sold through auction or competition, this institution is paid twice the fee. When a land is put up for auction, and after the auction. This double duty makes the land more expensive by sitting on the final selling price and increases the cost to the farmer who owns the land. In addition, the lengthy procedure for obtaining documents reduces the quality of the Service's work.
According to Aliyev, the investigation revealed problems that complicate the registration of farmland:
Problems in the purchase and sale of shared lands.
Lack of transparency in the activities of notary offices.
The importance of notarization of wills.
Documentation of municipal lands is subject to a double fee.
Difficulties created by the lack of municipal land acts.
Inadequacy of the mechanism of formation of the initial price of the land.
The need for notarization of the documents of the Auction Commission.
Decisions of the municipality are notarized.
Limited opportunities for early termination of the lease.
According to the presenter, the observations made during the development of the study identified the following instances that delayed the state registration of farmland.
Notary offices in the area
Territorial offices of the State Real Estate Registry Service
In both instances, there are cases of formal and informal costs, additional time loss, and double fees in the process of selling and leasing land, both privately and municipally. These problems are most pronounced in the process of state registration of municipal lands.
In conclusion, Aliyev presented their recommendations to simplify the procedure for state registration of farmland and eliminate additional costs.
These recommendations are:
In order to simplify the procedure for documenting the state registration of land sold or leased to farmers, the process of creating a State Register of Municipalities is being accelerated.
The mechanism of setting the selling price of municipal land formed at the last auction in the region as the starting price for the next auction should be abolished as it does not justify itself.
The auction mechanism for the lease of municipal lands is abolished by amending the Law on Municipal Land Management, and this right is returned directly to the municipality.
For municipal land plots to be leased, the mechanism for obtaining an Extract and Encumbrance Certificate (Form 1) from the State Register of the Real Estate Registry Service is abolished.
Amendments to the Civil Code, the Law on Notaries, as well as municipal legislation, give municipalities the right to conduct notarial acts in settlements without notary offices.
Notarization of the Decision and Certificate issued and sealed by the Auction Commission to the winner of the auction or competition held for the sale or lease of lands owned by the municipality shall be canceled.
The decision (sealed) issued by the municipal meeting on the sale or lease of the land owned is released from the obligation of notarization.
Mechanisms are being developed to obtain or privatize preferential leases for less suitable and unsuitable agricultural lands. In addition, a map and statistics of such lands in the municipality are created.
Awareness-raising events and creation of Internet resources are provided to increase the level of awareness of citizens engaged in farming activities.
Information on the state fee established for the approval of land purchase and sale agreements shall be posted on the boards of notary offices
Representative of the State Land and Mapping Committee Asif Asgarov drew attention to the auctions. According to him, information on the auction for the sale of municipal lands should be published in the press in advance and only after that the auction should be held within a month. At the same time, he added that electronic maps have already been provided to all rural municipalities.
Referring to the recommendations, economist Nazim Mammadov said that the mechanism of selling or leasing municipal lands through auctions should be maintained. According to him, the State Land and Cartography Committee should conduct an inspection to assess the efficiency of circulating lands.
Vahid Maharramov, a spokesman for the Economic Research Center, said problems with land registration had led to illegal land use. According to the expert, the purpose of the lands is being changed illegally. Maharramov also said that there were cases of abuse of the right to inherit, adding that the failure to notarize testaments can cause problems.
Representative of the State Land and Cartography Committee Javid Abdullayev spoke about the work done by the Committee in the field of information technology. According to him, a number of e-services have already been launched, which simplifies the registration process.
Other speakers then commented on the study.
