Special edition digest! City planning reform for Ukraine

31 August 2022
Special edition digest! City planning reform for Ukraine
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There is a strong chance that in the nearest future the Verkhovna Rada will consider a draft bill significantly changing the rules for city planning. If it is passed as is, it will provoke more conflicts between local communities and property developers. 

Special edition digest! City planning reform for Ukraine  

Draft bill # 5655 of June 11, 2021 

Status: second reading, MPs will be able to adopt it. 

Who is affected: property developers, government bodies, local governments, citizens, and businesses. 

Summary of the bill: 

  • private legal entities will be entitled to exercise city planning control over property developers. Services of these controllers will be paid for at the expense of property developers 
  • architects will be forced to transfer their intellectual property rights on project documentation to property developers under the contract. Currently, an architect has an exclusive right to oversee the construction conducted according to his or her project 
  • the role of the Unified State City Planning Electronic System will increase. It will generate permits for construction automatically thus supposedly mitigating corruption risks 
  • the City Planning Chamber will be created under the Ministry for Communities and Territories Development. It will be responsible for enforcing legislation concerning city planning. The Chamber will consist of 31 members: the minister, his deputy, the head of a subunit of the Ministry responsible for a state policy on city planning, and also representatives of property developers, expert organizations, city planning bodies, local communities executive committees, and universities. The composition of the Chamber will be approved by the Ministry for Communities and Territories Development 
  • appeals by community executive committees to dismantle illegal constructions will be considered by administrative courts only. Currently, depending on litigants’ statuses, such cases can be considered by administrative, commercial, or civil courts 
  • notaries will be allowed to work with city planning documents 
  • fines paid by developers violating city planning regulations will be transferred to the government budget 
  • in communities without executive committees on architecture, dedicated units of local state administrations will be responsible for city planning until local governments create the required committees. 

What is wrong: 

  • local governments will have much fewer powers in overseeing city planning. In particular, property developers will be able to create and pay for controlling legal entities and thus control themselves. This will result in power abuse and conflict of interests. The interests of developers will be protected but not the interests of the community and citizens. 
  • architects will have trouble exercising their intellectual property rights. Since intellectual property rights will be transferred to developers, developers will be able to change even finalized project documentation 
  • there is a risk that the Unified State City Planning Electronic System will generate permits for construction based simply on formal checks without the analysis of the content of the documents and their compliance to city planning requirements and restrictions. As a result, it will not only fail to mitigate corruption risks but facilitate corruption. Unscrupulous developers will just submit documents violating city planning regulations and still get their permits from the system 
  • there are no clear criteria for appointing members of the City Planning Chamber. The bill does not provide criteria or procedures for the Ministry for Communities and Territories Development that will select members of the City Planning Chamber. As a result, there is a risk that the Chamber will be ineffective, local governments and communities will be dependent on the Ministry, and city planning will be less transparent to citizens 
  • violations in city planning are harmful to communities in the first place, not the state. That is why fines for such violations should be a revenue source for local budgets, not the government budget 
  • local governments are substituted by state administrations, albeit temporarily. This goes against the decentralization reform and takes away powers from local governments. 

Additional information: 

  • the Association of cities of Ukraine spoke out against the bill. The Association emphasized a number of its shortcomings, among others, that it narrows the authority of local self-government and increases the role of the state in city planning 
  • architects were protesting against the proposed bill in Kyiv, Prykarpattia, Cherkasy, Lviv, also Uzhhorod, Ternopil, Ivano-Frankivsk, Zhytomyr, Rivne, Sumy, Poltava, Dnipro, Mykolaiv, Odesa, Vinnytsia, etc. 

What’s next: MPs will consider the bill in the second reading. However, there is no finalized version of the bill recommended by the Committee yet. MPs still have time to amend the document and engage all interested parties in the process.