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9.1 Land attention

9.1.1 Federal Regulations on Rights to Lan and Real Estate

According to item 2 of article 9 of the Constitution of the Russian Federation, land and other natural resources may be owned by state or municipal authorities, individuals and legal entities, or held under other conditions of ownership.

9.1.2 Civil and Land Codes

Chapter 17 of the Civil Code of the Russian Federation defines the rights of landowners and holders of rights to land. However, this Chapter of the Civil Code will only enter into force once the Parliament approves the new Land Code. To date, this set of laws has not yet been passed.

Therefore, issues concerning land ownership are currently regulated by the Constitution of the Russian Federation, the old Land Code, Decrees of the President of the Russian Federation and Resolutions of the Government of the Russian Federation.

9.1.3 Decrees of the President of the Russian Federation

Pursuant to Decree of the President of the Russian Federation ¹ 1767 of 27 October 1993 «On Regulating Land-Related Issues and Agricultural Reform in the Russian Federation», plots of land are considered real estate objects. Individuals and legal entities that own land have the right to sell, bequeath, exchange, mortgage and contribute it to the charter capital of companies. Land owned by the state or municipal authorities may be sold and transferred to private ownership only at auctions or tenders.

9.1.4 St. Petersburg Governmental Regulations Regarding Rights to Land

With the issue of Order ¹ 2'93 of 31 May 1996, the St. Petersburg Property Management Committee (KUGI) approved the Regulations «On Conducting Auctions and Tenders for the Sale of Undeveloped Plots of Land Located in St. Petersburg».

In accordance with these Regulations, legal entities (both foreign and Russian) may participate in auctions and tenders to purchase land. In addi-tion to being able to purchase land, entities may also lease land and build private property on it.

9.2 Real Estate

9.2.1 St. Petersburg Governmental Regulations Regarding Real Estate Issues

The Property Management Committee (KUGI) deals with all issues related to the lease and sale of real estate property in St. Petersburg, and has agencies in each district of the City Decisions regarding each real estate site are made by a district commission or the city commission of KUGI, depending on the status of the site. District agencies and property management committees of territories which are administrative subdivisions of St. Petersburg conclude lease agreements for land not intended for capital construction purposes, con-tracts for attic reconstruction on investment terms, lease agreements and other agreements which regulate legal relationships in respect of most individual buildings or parts thereof.

Similarly, in accordance with the Instructions of the Governor of St. Petersburg, the Registration Department for Real Estate Transactions, acting at the municipal level, concludes land lease agreements and contracts on investment activities, lease agreements for build-ings or parts of buildings leased to foreign representative offices and consulates, as well as lease agreements for several other sites.

For queries regarding a particular site, the Property Management Committee of the district in which the site is located must be contacted first. Complete information will be provided regarding this particular property, required documents and future steps to be taken.

9.2.2 Lease Payments for Non-Residential Premises Leased from St. Petersburg

Methods for determining lease payments for non-residential premises are established by Order of the Governor of St.Petersburg ¹ 1291-r of 22 December 1997 (amended on 24 January 2000).

The above Order provides two methods:

  • method of mass evaluation; and
  • method of individual evaluation.

Mass evaluation is the main method. Individual evaluation is applied to certain non-residential premises.

When calculating lease payments, several criteria are used to rate the consumer quality of the premises leased:

  • location;
  • area;
  • storey / number of storeys;
  • general condition of the premises;
  • entrance;
  • building type;
  • amenities, conveniences, landscaping; and
  • social significance of the leaseholder's activities.

9.3 Investment

In 1998, Law of St. Petersburg ¹ 191-35 of 30 July 1998 «On Investment into Real Estate of St. Petersburg entered into force in St. Petersburg».

It provides for a list of investment sites in the sphere of construction and reconstruction of real estate objects to be approved by order of the Governor of St. Petersburg.

The list of investment sites establishes sites for property development, plots of land intended for the construction of buildings (structures), or portions of buildings, which are subject to reconstruction (completion by construction) at the expense of investors.

Investment sites may be made available to a potential investor on a tender (auction) basis or to a specific investor for specific purposes. Investment sites may be given to specific investors for specific pur-poses only in exceptional cases stipulated by the Law.

To obtain an investment site, potential investors send investment proposals to the Administration of St. Petersburg. After the investment proposal is considered, the Investment Tender Commission of the Governor of St. Petersburg takes a decision either to give the invest-ment site to a specific investor for specific purposes or to put it up for tender.

A tender is open with regard to participants and is held in the form of a contest or an auction. An auction may be closed with regard to the price proposal. The winner of the auction is the entity that offers the highest price. The winner of the contest is the entity that proposes the best conditions (participation in the infrastructure, architectural and design solutions, etc.).

The winner enters into an investment contract with the St. Petersburg Property Management Committee (KUGI).

Information about investment sites and procedures for conducting investment activities may be obtained from the Bureau for Information Support of Investment Projects of KUGI of St. Petersburg. A permanent exhibition of invest-ment projects is organised at the Bureau.

The Bureau for Information Support of Investment Projects and the exhibition are located at

11 Ostrovskogu Square, St. Petersburg, 191011, Russia, tel./fax:(812) 3122430, tel.(812) 1104229

In addition, information on investment sites and procedures for conducting investment activities in St. Petersburg are available on the server:

(c) 2000