CASE OF ZELENCHUK AND TSYTSYURA v. UKRAINE (European Court of Human Rights)

FOURTH SECTION
CASE OF ZELENCHUKAND TSYTSYURA v. UKRAINE
(Applications nos. 846/16 and 1075/16)

JUDGMENT
STRASBOURG
22 May 2018

FINAL
22/08/2018

This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision.

 In the cases of Zelenchuk and Tsytsyura v. Ukraine,

The European Court of Human Rights (Fourth Section), sitting as a Chamber composed of:

Vincent A. De Gaetano, President,
          Ganna Yudkivska,
          Paulo Pinto de Albuquerque,
          Faris Vehabović,
          Georges Ravarani,
          Marko Bošnjak,
          Péter Paczolay, judges,
and Marialena Tsirli, Section Registrar,

Having deliberated in private on 10 April 2018,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1.  The case originated in applications (nos. 846/16 and 1075/16) against Ukraine lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by two Ukrainian nationals, Ms Sofiya Stepanivna Zelenchuk and Mr Viktor Antonovych Tsytsyura (“the applicants”), on 22 and 23 December 2015

2.  The applicants, who had been granted legal aid, were represented by Mr M. Tarakhkalo, a lawyer practising in Kyiv.When the applicants’ observations and claims for just satisfaction were submitted on 14 December 2016 the applicants were also represented by Mr A. Bushchenko, who at that time was a lawyer practising in Kyiv. The Ukrainian Government (“the Government”) were represented by their Agent, Mr I. Lishchyna.

3.  The applicants alleged that the legislative restrictionsimposed on them as owners of agricultural landhad breached their rights under Article 1 of Protocol No. 1 to the Convention.

4.  On 4 May 2016 the applications were communicated to the Government.

5.  Written submissions were received from EasyBusiness, an non-governmental organisation based in Kyiv, which had been granted leave by the President of the Section to intervene as a third party (Article 36 § 2 of the Convention and Rule 44 § 3 of the Rules of Court).

THE FACTS

THE CIRCUMSTANCES OF THE CASE

6.  Thefirst applicant was born in 1947 and lives in Dolyna, a city in the Ivano-Frankivsk Region.

In December 1996 her mother obtained a share of land in the village of Kopytkove in the Zdolbunivsky district of the Rivne region (see paragraphs 11 to 14 below concerning the nature of shares of land and their subsequent conversion into plots). Following her mother’s death in November 1999, the first applicant inherited that share and obtained a certificate confirming that she had become its new owner on 25 May 2000. On 10 January 2006 the Zdolbuniv District State Administration allocated a plot of land to her measuring2.5917 hectares,zoned for use as anindividual smallholding (особисте селянське господарство, see paragraph 18 below for a description of zoning categories of agricultural land under Ukrainian law).

The applicantobtained a property certificate in respect of that land on 13 August 2007. She rented out 2.0917 hectaresto a company under a lease registered on 30 May 2015 and due to expire on 10 November 2021, and 0.5 hectares to another company under a fifteen-year lease registered on 10 August 2016. According to the applicant, she receives rent in kind,either in grain or sunflower oil, depending on the crops grown on the land in a given year.

7.  The second applicant was born in 1939 and lives in Ternopil.

On an unspecified date his mother obtained the right to a share of land in the village of Rakovets in the Zbarazh district of the Ternopil region. In November 2004 he inherited it from her. On 27 March 2008 the Zbarazh District State Administration allocated 3.41 hectares of agricultural land to him, zoned for commercial agricultural production (товарне сілськогосподарське виробництво). He obtained a property certificate on 22 July 2008.

The land is rented by a limited liability company. Since 2010 the second applicant has received rent in the following amounts:

Year UAH

(in total)

UAH

(per hectare)

Approximate equivalent in EUR

(per hectare)

2010 729.29 213.87 20
2011 749.44 219.78 20
2012 1316.02 385.93 36
2013 1316.02 385.93 33
2014 1316.02 385.93 19
2015 2191.73 642.74 24
2016 2191.73 642.74 22

8.  The applicants’ land is subject to legislative restrictions on alienation and change of designated use, which are describedin “Relevant domestic material” and, as regards their current state, in paragraph 22

RELEVANT DOMESTIC MATERIAL

A.  Background to the legal situation of land ownership in Ukraine

9.  Under the laws of the Ukrainian Soviet Socialist Republic, prior to the enactment of the Land Code of 18 December 1990 (hereinafter “the Land Code”),individuals and non-State entities could not own land and all land was owned by the State.

10.  Under Article 17 of the LandCode, local councils were authorised to transfer land to individuals and non-State entities. However, for a period of six years, those who acquired land could not sell or otherwise dispose of it (except in cases of inheritance). They could only transfer the property back to their local council. The courts could shorten this period if there was a valid reason for such a decision.

11.  In the 1990s a large proportion of the country’s agricultural land was held by the former Soviet collective and State-owned farms which, under the Law of 14 February 1992 were renamed “collective agricultural enterprises” (hereinafter “CAEs” or “collective farms”).

12.  Presidential Decree no. 720/95 of 8 August 1995 provided for a programme of gradual reform of the CAEs through the issuance to their current and former members of shares of land, that is to say land entitlements in the form of shares of the whole land mass of the CAE expressed as a number of hectares but without a specific physical location ordefined boundaries.The decree provided that the shares were to be distributed to current and former members of CAEs as well as to certain categories of workers employed in the social sector (education, medicine and so forth) in rural areas. While thedecree gavemembers of the CAEs the ability towithdraw from their CAEs with their shares, the large-scale process of dissolving the CAEs through the issuance of shares did not actually start until 1999 (see next paragraph).

13.  Presidential Decree no. 1529/99 of 3 December 1999 accelerated the land reformby requiring the dissolution of all CAEs by April 2000, through the distribution of shares of land andother assets to their members. In the process of dissolving the CAEs, a large proportion of the rural population acquired shares of land.

14.  A large-scale process of converting the shares into physical plots of land (defined on the ground) was then organised. As a result of this process, millions of new owners were issued with ownership certificates relating to specific plots of land.[1] The land owned by the applicants underwent this process (see paragraphs 6 and 7 above).

15.  According to Parliamentary Resolution no. 882-IV of 22 May 2003 summarising the provisional results of the land reform, during the process 6.87 million Ukrainians obtained shares of land and 3.17 million had them converted into plots of land. Parliament noted some difficulties in the issuance of shares of land and their conversion into plots of land, with some regions falling behind: only 13% of share owners obtained property certificates to plots of land in the Zhytomyr Region, while this figure stood at 96% in the Kirovograd Region. Some 107,000 shares weresold or otherwise disposed of by their new owners, which, according to Parliament, showed that they had not been adequately informed about the land reform and their rights and duties.[2]

Parliament observed that, due to a lack of funding, the Cabinet of Ministers was only planning to complete the share conversion and titling work by 2006, which made it impossible to introduce the land sales market from 1 January 2005, as the Land Code provided at the time (see paragraph 19 below).

B.  The initial “land moratorium”

16.  Law no. 2242-III of 18 January 2001 prohibited, until the enactment of a new Land Code, the alienation of shares of land, except in cases of inheritance and expropriation for public needs.

17.  On 25 October 2001 a new Land Code was enacted. It entered into force on 1 January 2002.

18.  Article 22 § 3 of the new Land Code defines the following categories of designated use for agricultural land: (i)individual smallholdings; (ii)land for fruit and vegetable growing;(iii)land for pasture and hay harvesting;(iv)land for commercial agricultural production; and (v) individual farming enterprises, that is to saycommercial entities owned by individual farmers engaged in commercial agricultural production.

19.  Article 15 of the Transitional Provisions of the new Land Code provided that until 1 January 2005 individuals and non-State entities could not sell or otherwise transfer title to two categories of land in their ownership: (i) plots zonedfor individual farming enterprises or for other commercial agricultural production and (ii)shares of land. Swap transactions, inheritance cases and expropriation for public needs were exempt from the ban. The ban, which has been subsequently extended and modified (see the Table in paragraph 21 below) is commonly referred to in Ukraine as the “the land moratorium” (земельний мораторій).

20.  According to the Government, the transcript of the parliamentary session at which the new Code was passed shows that the moratorium was introduced in view of the need for additional time to form a land market with “adequate” prices and enact legislation necessary for the creation of such a market. In particular, according to the transcript, at the opening of the debate Member of Parliament V. Asadchev expressed his concern that, if rules of the Code concerning the transfer of land into private hands were to be adopted, this would create a few large landowners (десять латифундистів) and transform the rest of the population into hired agricultural labour (батраки). In presenting the draft Code for the vote, Ms K. Vashchuk, Chairwoman of the Parliamentary Committee for LandAffairs and Agriculture, stated that, in order to address concerns such as those expressed by the MP, the draft suspended the operation of all provisions concerning the sale of land until 2005, until laws on the creation of a land cadastre, land registration and others were passed and a State land bank was established.[3]

C.  Changes in the moratorium and its current form

21.  The Land Code was amended on a number of occasions as to both the duration and scope of the original ban, as summarised in the Table below:

Table Key legislative developments concerning the land moratorium

No. Date of the law End date of the ban Changes in the scope of the moratorium and other related changes Summary of the reasons given in the explanatory note to the draft law
1 06/10/2004 01/01/2007 Swap transactions involving land, including swaps of land for equity in companies, prohibited Legislation governing the land market had not yet been developed by the Cabinet of Ministers; technical work was needed to prepare the administrations for processing land transactions. The “extension” was needed to prevent “ impoverishment of the Ukrainian people” and the buying up of land by Ukrainian and foreign tycoons (магнати)
2 09/02/2006 Contracts and powers of attorney envisaging future (after expiry of the moratorium) transfers of land subject to the moratorium declared invalid Legislation aimed at preventing circumvention of the moratorium through the issuance of powers of attorney by land owners to third parties authorising them to dispose of the land subject to the moratorium[4]
3 19/12/2006 01/01/2008 Moratorium extended, in addition to land for commercial agricultural production, toindividual smallholdings(see paragraph 18 above);any change of designated use of the land subject to the moratorium forbidden;swap transactions involving a swap of one land plot for another allowedagain Develop private land ownership, ensure the unrestricted exercise of owners’ rights, and ensurefree circulation of land except in the cases provided for by law. The creation of a land market would allow transfers of land to more efficient users but in order to do so the market had to be subject to reasonable regulation. Such regulation should include: limits on changing the designated use, the imposition of criteria to qualify as a buyer of land, limiting the maximum plot sizes of certain land and theconcentration of landin the hands ofa single person and family etc.
4 28/12/2007 and 03/06/2008[5] Until entry into force of the Land Cadastre Actand Land Market Act No notable changes The amendments were incorporated in omnibus bills covering mostly budgetary matters and containing a wide range of changes; there were apparently no specific comments made on the moratorium issue[6]
5 19/01/2010 Until entry into force of the Land Cadastre Actand Land Market Act,but not before01/01/2012 No notable changes Legislation regulating land relations had not yet been developed; technical work was needed to prepare administrations for processing land transactions. The “extension” was needed to prevent “impoverishment of the Ukrainian people” and the buying up of land by Ukrainian and foreign tycoons
6 07/07/2011

and 01/01/2013

 

Land Cadastre Act was enacted and entered into force
7 09/12/2011 Parliament approved the draft Land Market Actat the first reading (see paragraph 40 below).It appears that no further progress on the bill was made In the course of the parliamentary debate it was proposed to rename the Land Market ActtheCirculation of Agricultural Land Act (“the CALA”).[7]
8 20/12/2011 Until entry into force of the Land Market Act, but not before 01/01/2013 No notable changes The Land Cadastre Act would enter into force on 1 January 2013 and the end of moratorium should be set for that specific date
9 02/10/2012 Change of designated use was allowed where land was allocated to an investor under a production-sharing agreement Encourage investment under production-sharing agreements, particularly in the field of the exploration and extraction of hydrocarbons
10 20/11/2012 Until entry into force of the CALA, but not before 01/01/2016 The law extending the moratorium instructed the Cabinet of Ministers to produce the draft CALA and submit it to Parliament within six months. Even though the draft Land Market Acthad beenapproved at the first reading on 9 December 2011, it had not yet been passed into law. A change to the concept of that bill was envisaged, with the name changing to the CALA. An “extension” of the moratorium was needed to develop an effective mechanism for sales and overseeing sales of land and to prevent possible abuses
11 10/11/2015 The same as in row10, but not before 01/01/2017 The law extending the moratorium instructed the Cabinet of Ministers to produce the draft CALA and submit it to Parliament by 01/03/2016 Lifting the moratorium in times of war and economic crisis would be a threat to national and food security and the threat of a loss of land, as an important national resource. A step-by-step roadmap for introducing agricultural land into circulation, which would be clear to the public, needed to be developed. The moratorium created difficulties in obtaining finance for agricultural production, andled to depopulation of the countryside. In order to solve these and other problems created by the moratorium, the CALA had to be passed and the landeventually introduced into circulation
12 06/10/2016 The same as in row 10, but not before 01/01/2018 Draft CALA to be submitted by 01/07/2017Apparently no such draft was submitted by the Cabinet of Ministers by this or the previously set deadlines, although two drafts of theCALA were submitted in 2016 by certain MPs (see paragraph 43 below) Whilethe creation of a land market was a necessary element of the development of a market economy, the market had to be transparent and fair, competitive and efficient, and be able to prevent shadow transactions. Therefore the “extension” was needed to develop legislation regulating the land market[8]
13 07/12/2017 The same as in row10, but not before 01/01/2019 Draft CALA to be submitted by 01/07/2018 Abolition of the moratorium in times of war and economic crisis without having in place legislation regulating the circulation of agricultural land would create risks for national and food security. A lifting of the moratorium had to be preceded by legislative work to encourage the creation of a network of strong farmers’ enterprises and cooperatives. The prohibition on the sale of agricultural land was a barrier for attracting investment in the agriculturalsector since land could not be used as security for loans, but its lifting could not be the end in itself and needed to be thought of as a measure to encourage investment in the agricultural sector without, at the same time, leading to landlessness among the rural population[9]

22.  As at today’s date, the Transitional Provisions of the Land Code prohibit alienation in any form of most agricultural land, including of the categories owned by the applicants, except in cases of inheritance, swap transactions and expropriation for public use. They also prohibit any change in the designated use of such land, except where ithas been allocated to an investor under a production-sharing agreement. Currently the Transitional Provisions state that those restrictions are to remain effective until the entry into force of the Circulation of Agricultural Land Act (“the CALA”), but in any case at least until 1 January 2019.

D.  Constitutional matters

23.  Article 13 § 1 of the Constitution of 1996 provides that land, its subsoil, air, water and other resources are the property of the Ukrainian people (є об’єктами права власності Українського народу). Article 13 § 4 requires the State to ensure protection of the rights of all property owners and economic players and social orientation of the economy. Article 14 § 1 provides that land is the main national asset, and is underthe special protection of the State. Article 14 § 2 guarantees the right to land ownership and provides that land ownership may be acquired and exercised by citizens, legal entities and the State in accordance with the law.

24.  Article 22 provides that human and citizens’ rights and freedoms are guaranteed and may not be diminished by the enactment of new laws or the amendment of laws that are already in force.

25.  Article 41 of the Constitution reads:

“Everyone shall have the right to own, use, or dispose of his or her property and the results of his or her intellectual or creative activities.

No one shall be unlawfully deprived of the right to property. The right to private property shall be inviolable…”

26.  On 17 February 2017 fifty-five Members of Parliament lodged an application with the Constitutional Court seeking to have the Law of 6 October 2016 reaffirming the moratorium declared unconstitutional.[10] They invoked Articles 13, 14, and 41 of the Constitution set out above as well as Articles 8 (the principle of the rule of law), 24 (non-discrimination), 42 (the right to enterprise), 48 (the right to a sufficient standard of living), and 64 (general provision concerning the restriction of constitutional rights) of the Constitution.

On 14 February 2018 the Constitutional Court rejected the application without examining it on the merits. It found the arguments presented in support of that application for abstract review insufficiently developed to permit the opening of the constitutional review proceedings and its substantive examination. It concluded that the application failed to meet the requirements of section 51 § 3 of the Constitutional Court Act which sets out the details an application must contain, namely the reasoning as to why the applicant considered a given provision unconstitutional.

According to the information on the Constitutional Court’s web site, as of 6 April 2018, which appears to be the most recent information publicly available on the date of examination of the case by the Court, there was no new application for constitutional review of the matter in question pending.[11]

E.  Taxation and rules governing land ownership

27.  Article 281.3 of the Tax Code of 2010 exempts from property tax land rented to commercial agricultural producers benefitting from the simplified taxation regime.[12] Article 281.1.3 exempts old-age pensioners from the payment of land tax.

28.  Article 78 § 1 defines ownership as the right to possess, use and dispose of land.

29.  Article 81 § 2 and Article 82 §§ 2 and 3 provide that foreign nationals, stateless persons, foreign legal entities and legal entities with foreign capital can only own non-agricultural landof certain categories.

30.  Article 91 requires land owners to use land according to its designated use category, respect environmental rules, improve land fertility, respect neighbours’ rights, and so forth. Article 143 provides that a court may order expropriation of land without compensation in cases of failure to respect the designated use of the land or rectify a serious breach of land protection rules despite a warning from the land protection authorities.

31.  Article 130 provides that land zoned for commercial agricultural production can only be acquired by a Ukrainian national with sufficient educational qualifications or experience to engage in agricultural production or by a Ukrainian legal entity which has agriculture listed in its articles of association among the types of business it can engage in. Themunicipality where the land is located, as well as its permanent residents, have a right of first refusalin respect of the land sold.

32.  Item 13 of the Transitional Provisions of the Code, as in force in 2001, provided that a single person or entity could not acquire more than 100 hectares of agricultural land. The Law of 6 October 2004 (the first extension of the moratorium – see row1 of the Table in paragraph 21 above) extended that limitation to 1 January 2015. It expired on that date. However, given that most agricultural land could not be sold throughout the period, it would appear that the restriction never had much practical application.

F.  Rules and statistics concerning the land lease market

33.  The Land Lease Act (section21) provides that rent is set by agreement of the parties.However, Presidential Decree no. 92/2002 of 2 February 2002 instructed the Cabinet of Ministers and local executive authorities to take operational measures to ensure that the level of rent under land leases would be at least 3% of the land’s estimated value. According to the statistics published by the State Land Cadastre Agency, in 2013 74.4% of leases provided for rent of at least 3% of the value.[13]

34.  Section 19 of the Land Lease Actprovides that for the main categories of agricultural land, the term of lease cannot be less than seven years and, for any lease, cannot exceed fifty years.

35.  The State Land Cadastre Agency published certain statistics concerning the land lease market in Ukraine on which the parties relied in their submissions:

(i)  as at 2013 there were 4,741,400 leases concerning shares of land in former CAEs or plots converted from former shares, covering 17.5 million hectares. Of them 35.5% were with entities which were successors of formercollective farms, 14.2% with individual farming enterprises(see paragraph 18 above) and 50.3% with other entities. The national average rent was UAH 563.50 (around EUR 48 at the time). 52.2% of landlords were pensioners;[14]

(ii)  as at April 2015 the number of leases rose to 4.8 million, the national average annual rent was UAH 727.6 per hectare (about EUR 29 at the time) and the average rent for the Rivne and Ternopil regions, where the first and the second applicant’s land was located, were UAH 1068.80 and 546.10 per hectare (EUR 42 and 21 respectively).[15]

G.  Policy statements and plans, legislative proposals and public attitudes towards the moratorium

36.  On 31 May 2002, in his annual addressto Parliament on the state of the nation, the President of Ukraine stressed the need to create thestructure for an efficient and transparent land market by 2005, when the moratorium would expire. Important aspects were the creation of a transparent property registration system, introduction of the ability to use land as security for mortgage financing and completion of theconversion of shares of land into plots and the issuance of property certificates.[16]

37.  Coalition Agreements of 22 June 2006 and 29 November 2007[17] and an action programmeof the Cabinet of Ministers of 16 January 2008[18]stated, in nearly identical terms,that the coalition and government had the following priorities: creation of the conditions for the functioning of the land market (issuance of ownership certificates, demarcation of boundaries of plots of land, putting the land cadastre into operation, land valuations, introduction of the mechanism for land market regulation) and then revocation of the moratorium.

38.  On 17 June 2009 the Cabinet of Ministers approved the outline of a State programme for the development of land relations until 2020. It noted a number of problems in land relations and listed a number of measures to resolve them, including thegradual introduction into circulation of land and rights to it andthe creation and development of a land market.

39.  On 7 April 2011, in his annual addressto Parliament on the state of the nation, the President of Ukraine stated that the moratorium was preventing thetransfer of land to efficient owners, thus slowing down the development of the agricultural sector. Steps in order to introduce a regulated land market had to be taken urgently.[19]

40.  On 9 December 2011 Parliament approved the draft Land Market Actat the first reading (see paragraph 21above).[20] The draft lawprovided that only citizens of Ukraine, municipalities and the State could acquire agricultural land. A single citizen would not be permitted to own more than 100 hectares of land zoned for commercial agricultural production or rent more than 6,000 hectares of such land in any one district or more than 5% of the land in any one region. The caps would also apply to those associated with the individual. The bill provided that owners of neighbouring land would have a right of first refusal in the event of alienation of agricultural land and that such land could not be sold for less than the price determined by an expert, a procedure to be regulated by law. Rezoning of formerly publiclyowned agricultural land would be prohibited for ten years after acquisition. The bill also contained a number of other rules aimed at safeguarding the efficient use of agricultural land.

41.  On 3 July 2012, in his annual addressto Parliament on the state of the nation, the President of Ukraine stated that that year, before revocation of the moratorium, a mechanism for the effective protection of the interests of agricultural producers and of food security of the country needed to be created and their effective functioning secured.[21]

42.  In his annual addressesto Parliament on the state of the nation in 2016 and 2017, the President of Ukraine made the following remarks concerning the land moratorium.

On 6 September 2016 he said:

“The inability to freely sell and buy agricultural land unquestionably inhibits investment in agriculture, reduces and breaches the rights of the rural population, among other things, lease rights, taking the last remaining kopeksout of their pockets. This is axiomatic. However, I am also aware of public opinion on this matter and the position of the majority of parliamentary groups. I value and respect that. But how can we resolve this problem, my dear legislators? This is within your purview. Either to stick your head in the sand and change nothing or to work to create a land market in Ukraine with all the possible safeguards against any possible negative impact.”[22]

On 7 September 2017 he said:

“.. In Estonia they have privatised everything: ports, telecommunications, aviation and even the railways. In Poland out of 8,500 State companies the State has kept only 41. And, by the way, their land has not been bought up by foreigners, despite the fact that the residents of those countries can easily buy and sell agricultural land.

Until now, Ukrainians have been deprived of that right. Millions of people formally own land but it has been decided for them that they are unable to handle it and an unconstitutional moratorium was introduced. Why then do we allow people to sell their flats? Because you know, by this logic, someone could come along and buy them all up.

As a statesman, in making decisions I must have regard to public opinion. For now, unfortunately, it has been formed by the populists. I am not going to put pressure onParliament to adopt the land reform, I will not do it. But I am asking you to make a resolution, for now at least a silent one, in your minds, in favour of such a reform. Enact such laws which would assuage the phobias, which would remove all the objections, introduce all the necessary safeguards, introduce minimum prices, make registers transparent, protect the rural population but also give them freedom. I am asking you to set, I invite you to set, a specific date when all of this could be launched, even if not today.”[23]

43.  On 3 April 2017 the Cabinet of Ministers approved its mid-term action plan for up until 2020 and its priority action plan for 2017. The 2020 plan describes the continuing maintenance of the moratorium as one of the main problems in the agricultural sector that deprives a large number of Ukrainian citizens of the opportunity to exercise their constitutional right to property and obstructs the development of the agricultural market. The plan provides that the problem created by the moratorium could be resolved through nationwide discussion and the introduction of a land market based on a model acceptable to the population.The 2017 plan stated thatthe draft CALA would be submitted to Parliament in the second quarter of 2017. However, it appears that no such bill has been introduced.[24]

44.  The Government submitted information about protest actions led by farmers in early October 2016 in a number of regions, including highway blockades. The farmers called for the restoration of tax benefits for the agricultural sector. One of their demands was also to reaffirm the land moratorium.

III.  COMPARATIVE LAW

45.  It appears from the material available to the Court on the legislation of member States of the Council of Europe that none of the thirty‑two member States surveyed has a general ban on the sale or any other form of alienation of agricultural land. The same can be said about the two non‑member States surveyed, Canada and the United States of America.

46.  Although twenty-two of the thirty-two member States surveyed have undergone a land-reform programme since 1990 (Armenia, Azerbaijan, Bosnia and Herzegovina, Croatia, the Czech Republic, Estonia, Finland, Germany (after unification), Greece, Hungary, Latvia, Lithuania, the Republic of Moldova, Montenegro, Poland, Romania, the Russian Federation, Serbia, Slovak Republic, Slovenia and the former Yugoslav Republic of Macedonia), none of those States have since that time imposed such a general ban, even though some used to impose time-limited restrictions on the resale of land acquired as a result of privatisation, for example three years in Armenia and ten years in Russia (according to pre‑2001 legislation).

47.  However, in many of the member States surveyed transfers of agricultural land are subject to a number of restrictions and conditions.

48.  Thus, in seven of the member States surveyed (Austria, France, Germany, Hungary, Lithuania, Norway and Sweden), the transfer of ownership of agricultural land must be authorised by a special government body.Generally speaking, the authorisation procedure is normally aimed at preserving the effective use of the land for agriculture, so that for example in Austria for the authorisation to be issued the buyer needs to provide assurances that he or she will actually cultivate the acquired land.In another example,in Norway a typical condition on which authorisation is granted may be that the buyer must move onto the land and live on it for five years. In a further three member States (Poland, the Slovak Republic and Slovenia) some categories of buyers, notably those already engaged in farming or their family members, are exempted from the authorisation procedure.

49.  In seven of the member States surveyed (Austria, Hungary, Latvia, Lithuania, Poland, the Slovak Republic and Slovenia), qualifications or prior experience in theagricultural sector on the part of the buyer are required for the transfer of ownership of land or to confer priority over other buyers. Some States, such as Estonia, Poland and Sweden, generally authorise only individuals, and not legal entities, to acquire agricultural land of a certain size and subject acquisition by legal entities to additional conditions, such as the need to obtain a permit.

50.  More than half of the member States surveyed – eighteen out of thirty-two, namely Austria, Bosnia and Herzegovina, the Czech Republic, Finland, France, Georgia, Hungary, Italy, Latvia, Lithuania, the Netherlands, Poland, Romania, the Russian Federation, Serbia, the Slovak Republic, Slovenia and the former Yugoslav Republic of Macedonia – have pre-emption laws, securing a right of first refusal mostly to co-owners, close family members, neighbouring or other farmers, tenants, agricultural enterprises, municipalities and in some cases the State.

51.  In nine of the member States surveyed (Armenia, Azerbaijan, Bosnia and Herzegovina, Croatia, Georgia, the Republic of Moldova, Montenegro, the Russian Federation and the former Yugoslav Republic of Macedonia), agricultural land cannot generally be sold to foreign persons. In addition, the majority of the surveyed former Soviet Union and other Central and East European member States make a distinction between European Union nationals, who generally can acquire agricultural land subject to compliance with other restrictions and after the expiry of certain time-limited transitional periods, and third-country nationals, for whom restrictions are more severe (for example, the requirement to obtain a special permit in Estonia and a ban on ownership by third-country nationals in Hungary). However, these restrictions are subject to exceptions, notably in cases of inheritance and where more liberal rules are provided by international agreements. A special regime may thus be in place with member States of the European Economic Area and of the Organisation for Economic Co‑operation and Development.

52.  In eight of the member States surveyed (Estonia, Hungary, Latvia, Lithuania, Poland, the Russian Federation, the former Yugoslav Republic of Macedonia and Turkey) there are restrictions on the size of agricultural land that can be disposed of. Generally, these States impose caps on the maximum amount of land which can be owned by the same person (ranging from 300 hectares in Hungary to 10% of the agricultural land area in a territorial unit in Russia) although some also limit the minimum size of land parcels, seeking to prevent excessive subdivision of land below a certain size.

53.  Certain States have particular procedures in place for the sale of agricultural land. For instance, Bosnia and Herzegovina requires land most suitable for agriculture to be sold at public auctions. States, such as Italy, which have pre-emption laws, also have in place detailed procedures aimed at ensuring the effective exercise of pre-emption rights.

54.  Special restrictions also exist in certain sensitive areas such as border areas and areas adjacent to military installations (for example, in Greece and Serbia).

THE LAW

JOINDER OF THE APPLICATIONS

55.  The Court considers that, pursuant to Rule 42 § 1 of the Rules of Court, the applications should be joined, given their common factual and legal background.

ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1

56.  The applicants complained that the legislative restrictions applicable to their land had breached their right to peaceful enjoyment of their possessions, guaranteed by Article 1 of Protocol No. 1, which reads as follows:

“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”

A.  Admissibility

57.  The Government submitted that the first applicant had omitted to inform the Court in her application form that she had rented out her land. They accordingly invited the Court to reject her application for abuse of the right of individual application. The first applicant, implicitly admitting that she had omitted to mention the leasing arrangements in her application form, stated that she had believed this fact to be irrelevant to her application since her complaint concerned the restrictions on transfers of land other than leases. The negative impact of the restrictions on sales and other transfers on the value of the land, including its rental value, was only one aspect of her complaint.

58.  The Court reiterates that the submission of incomplete and thus misleading information may amount to an abuse of the right of application, especially if the information concerns the very core of the case and no sufficient explanation has been provided for the failure to disclose that information. However, the applicant’s intention to mislead the Court must always be established with sufficient certainty (see Gross v. Switzerland [GC], no. 67810/10, § 28, ECHR 2014, with further references therein).

59.  Turning to the circumstances of the present case, the Court observes that the first applicant’s initial submissions did not contain information about the fact that she had rented out her land. However, the Court cannot establish that by omitting to make such submissions she intended to mislead the Court. It cannot find, therefore, that she has abused the right of application.

60.  The Court notes that the applicationis not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention. It further notes that it is not inadmissible on any other grounds. It must therefore be declared admissible.

B.  Merits

1.  The parties’ submissions

(a)  The applicants and the Government

(i)  Existence of an interference and the applicable rule

61.  The parties agreed that there had been an interference with the applicants’ rights guaranteed by Article 1 of Protocol No. 1 and that this interference constituted “control” of the use of property within the meaning of the second paragraph of that provision.

(ii)  Lawfulness

62.  The parties agreed that the moratorium had basis in domestic law and that the relevant provisions were accessible. They disagreed as to whether they were “foreseeable”.

(α)  The applicants

63.  The applicants argued that the interference with their rights could not be considered to be based on precise and foreseeable provisions ofthe law. The first and second applicantshadinherited their shares of land in May 2000 and November 2004 respectively and could reasonably expect that the moratorium would expire on 1 January 2005, as indicated at the time in the Transitional Provisions of the Land Code. Three years, the original duration of the moratorium, could reasonably be regarded as sufficient time to enact the necessary legislation regulating the land market. Thus, even if the original duration of the moratorium had been foreseeable, its subsequent extensions had not been.Enactment of the necessary legislation had been cited as the reason for each extension but it had not been enacted throughout all those years. For instance, the draft Land Market Acthad beenapproved at the first reading in 2011 but no further progress had been made on that bill. Likewise, the 2015 law extending the moratorium had required the Cabinet of Ministers to develop a draft law regulatingthe circulation of agricultural land, the enactment of which had been the precondition to the lifting of the moratorium, by 1 March 2016. However, no such bill had been submitted.

64.  For the applicants, those factors made the moratorium “virtually perpetual” and the relevant law unforeseeable. The applicants relied in this connection on judgments in which the Court reproached the authorities for failing to regulate certain relations for a period of time and resolve legal uncertainty (Zagorodniy v. Ukraine, no. 27004/06, §§ 53-56, 24 November 2011; Vyerentsov v. Ukraine, no. 20372/11, §§ 51-53, 11 April 2013; R & L, s.r.o.and Others v. the Czech Republic, 37926/05 and 4 others, §§ 117‑23, 3 July 2014; and Veniamin Tymoshenko and Others v. Ukraine, no. 48408/12, §§ 84 and 85, 2 October 2014). They contested the Government’s submission that each extension had given a clear new deadline, as only the extensions of 2004 and 2006 had given specific expiry dates (see paragraph 21 above) and the others hadlinked the lifting of the moratorium to the enactment of certain laws. For the applicants, this meant that the moratorium was of avirtually unlimited duration; the law did not contain sufficiently clear indicators as to when exactly it would be lifted, if at all. The wide margin of appreciation afforded to the national authorities in economic and social matters did not mean the right to put individuals in a situation of such protracted uncertainty.

65.  If the State had wished to prohibit transfers of agricultural land into private property, it could have done so from the outset. Instead, the State had transferred land to members of former collective farms and expressed a clear intention to authorise the owners of the land to dispose of it. Once it had done so, it should have provided a legislative framework for the exercise of that right. Failure to do so for many years, without a clear indication as to when it would be done, had created a situation contrary to the requirements of “legality” inherent in Article 1 of Protocol No. 1.

66.  What is more, the reasons for extending the moratorium had evolved over time – even if initially the extensions had been motivated merely by the need to enact the necessary legislation and conduct technical preparatory work, additional, more vague reasons had been added over time. This rendered the applicants’ situation even less foreseeable.

(β)  The Government

67.  The Government submitted thatthe applicants’allegation that the moratorium was in place for an indefinite period was not true. Each extension of the moratorium had containeda clear endpoint, and each new extension had been adopted before the previous end date and at no point could the applicants entertain any expectation that they would be able to sell before the end date. Article 1 of Protocol No. 1 could not be interpreted as protecting the applicants against the changes in the legal regime of their possessions. The Government cited Van Marle and Others v. the Netherlands (26 June 1986, § 43, Series A no. 101) in support of their argument. The extensions had been passed following a wide discussion of the matter and the applicants could not claim to be unaware of the possibility of those extensions.

(iii)  General interest

(α)  The applicants

68.  The applicants submitted that even though nominally additional reasons other than the need to enact the necessary land market legislation had been given in theexplanatory notes to the laws extending the moratorium (see the Table in paragraph 21above), these had been mere “cover” for the State’s inability to enact the relevant legislation, which, if properly drafted and enacted, could in fact have addressed all the alleged possible risks and concerns stated in the explanatory notes.The applicants concentrated, in this connection, on the concerns expressed by the legislature in the explanatory note for the 2015 extension, namely that the moratorium was needed to ensure national and food securityand the Government’s argument that the release of agricultural land into circulation would risk it being purchased en masse for meagre prices and its concentration in the hands of a few tycoons or unfriendly powers, its withdrawal from cultivation and the impoverishment of farmers (see paragraph 76 below).

69.  As to the risk of impoverishing farmers and amassive selloff of land at low prices, the applicants stated that lifting the moratorium would not mean that landowners would be compelled to sell, rather it would be their free decision whether to do so. The applicants referred to the third-party intervener’s submissions and other material showing that, in the opinion of some experts, international experience showed that the opening up of land markets normally led to a rise in land prices (see paragraph 96 below). They referred in particular to the alleged experience of Romania, which had experienced a high rate of growth in land prices. They also referred to the opinion of a former head of the State Land Cadastre Agency who had said, reportedly, that the lifting of the moratorium would lead to a 25% increase in land prices and a rise in land productivity. They submitted that,according to “expert opinion”, a fully open land market would generate from 50 to 100 billion US dollars in “GDP growth, foreign and domestic investment” as well as additional tax revenue.

70.  As to the risk of excessive concentration of land holdings, the applicants referred to the third-party intervener’s assessment that no international financial entity possessed the financial resources necessary to buy up land in quantities which would constitute a threat. High land fragmentation also made this risk unrealistic (see paragraph 96 below). The risk of excessive concentration could be easily mitigated by introducing caps on the maximum amount of land owned, as the draft Land Market Acthad envisaged (see paragraph 40 above). It was the prohibition introduced by the moratorium which had pushed the land transactions into the shadow and de facto created a non-transparent shadowland market. It had led to the very problems the Government referred to, in particular a high concentration of land in the hands of large agricultural companies. This was because the moratorium presented the landowners with only two options: either to cultivate the land themselves (which they often could not do due to their age, health, the remoteness of the land, orland fragmentation making cultivation not viable economically) or accept leases under the conditions proposed by the agricultural producers. This market dominance of the agribusiness companies had led to low rents (they cited the State Land Cadastre Agency’s statistics set out in paragraph 35 above) and “land devastation”.

71.  For the applicants, it had precisely been the extension of the moratorium that had created and aggravated the problems cited by the Government as the reasons for extending it. It had prevented the flow of resources into the agricultural sector, in particular to small and medium farmers, because it had blocked their access to bank loans which could be secured on their land, and had thus prevented the development of the agriculture sector in general. This had also been admitted by the President of Ukraine (see paragraph 42 above).

72.  As to the supposed protests against the lifting of the moratorium, the applicants alleged thatthe main opponents of the lifting of the moratorium had cited the absence of an appropriate legislative framework as the main reason for their support for its continuation. Support for the moratorium had mainly come from non-farmers and large agricultural companies benefitting from the absence of a transparent land market and lobbying to keep it in place for as long as possible.

73.  The applicants submitted that the moratorium was harming the economy, the landowners and the agrarian sector, instead of protecting them from “imaginary risks”. Its extensions had not been dictated by any necessity but by purely populist political considerations. Therefore, the legislature’sjudgment as to what was in the “general interest” was manifestly without reasonable foundation.

(β)  The Government

74.  The Government stressed that the legislature enjoyed a wide margin of appreciation in matters of economic policy. The Court had to respect their judgment unless it was manifestly without reasonable foundation.

75.  They submitted that agricultural land accounted for 70% of Ukraine’s territory, the country having one of the world’s highest indicators of agricultural land per capita. This constituted great potential for the country but required implementation of an effective model of rational land use. The Government pointed to the constitutional provisions declaring land the main national asset and requiring appropriate regulation of land ownership and use (see paragraph 23 above). The moratorium was needed to create an appropriate framework for the protection of the rights of citizens and of the State. The extended period of operation of the moratorium was due to the need to create appropriate legal, institutional, financial and economic conditions for the introduction of free circulation of the land.

76.  Referring to the explanatory note to the law which extended the moratorium in 2015 (seerow 11 of the Table at paragraph 21 above), the Government submitted that the goal of the moratorium was to protect food and national security. Releasing land into circulation risked creating conditions for the concentration of landin the hands of a few tycoons or “foreign and unfriendly power” in exchange for a fraction of its real value, its withdrawal from cultivation, and the impoverishment of farmers. The Government considered that the reality of those dangers was illustrated by the experience of a brief period in the early 2000s when free circulation of shares of landhad been allowed and shares had been purchased en masse for meagre prices. The Government referred, in this respect, to the statistics summarised in Parliament’s Resolution of 22 May 2003 (see paragraph 15 above).

77.  The adoption and extensions of the moratorium had created considerable debate inside and outside of Parliament in the course of which both supporters and opponents of the moratorium had been free to express their opinions.

78.  While Ukrainian society was sharply divided on the matter of the moratorium, a very substantial part of society, political parties, local authorities and academics, were in favour of maintaining it. The Government pointed to the protests which had taken place in 2016 demanding that the moratorium be maintained (see paragraph 44above).

(iv)  Proportionality

(α)  The applicants

79.  The margin of appreciation available to the national authorities could not cover a measure as extreme as a fifteen-year-long absolute prohibition on the alienation of land. Noother State had such an absolute prohibition in place, only imposing certain conditions on sale or resale.

80.  To the extent the Government argued that the applicants had acquired the land of their free will at a time when it had already been subject to restrictions, the applicants stressed that they had inherited the land by right and that, at the time, there had been specific deadlines in place for the expiry of the restrictions on land transactions. In this connection,they referred to their observations concerning the lawfulness of the interference (see paragraphs 63 to 66above) and stressed that, when they had acquired the land, they could legitimately expect that the moratorium would expire and that they would be able to dispose of their land. As to the fact that the applicants had received their land free of charge, they argued that the protection provided by the Convention could not be made dependent on whether property had been acquired for free or otherwise (citing Malta, no. 31122/05, 26 September 2006).

81.  As to the Government’s reliance on the fact that the applicants’ rights to use and rent out the land had been unaffected by the moratorium, they stressed that the right to dispose of property was an essential element of ownership and it was for an owner to decide whether to dispose of or retain his or her property. Moreover, their plots were small and were located 300 and 50 kilometres from theirrespective places of residence. They were also elderly persons in poor health. This had prevented them from cultivating the land on their own.

82.  Renting the land out at “knockdown prices” was not a viable proposition either: unable to find offers for monetary rent at an acceptable level, the first applicant had had to accept rent in kind and the second applicant was receiving very low rent payments (see paragraphs 6 and 7 above).Moreover, domestic law imposed a number of duties on the applicants as landowners, including the need to comply with environmental rules and pay property tax(see paragraph 30 above) which they would be unable to comply with without renting their land out to an agricultural producer. If not for the moratorium, the only viable option for the applicants would be to sell their land.

83.  The applicants drew parallels between their situation and those of the applicants in the case ofSporrong and Lönnroth v. Sweden (23 September 1982, Series A no. 52), in that the Ukrainian legislature’s persistent failure to enact legislation which would allow the moratorium to be lifted and land to be sold was analogous to the Swedish authorities’ repeated extensions of a prohibition on construction which had created a prolonged situation of uncertainty for the applicants in that case.

84.  This uncertainty and the legislature’s prolonged failure to adopt the necessary rules and lift the moratorium upset the balance between the protection of the applicants’ rights and the general interest, and imposed an excessive individual burden on them.

(β)  The Government

85.  The Government stressed that the member States had wide discretion to establish rules governing the circulation of agricultural land. Although they hada common origin in the “common understanding” of the need to control the circulation of agricultural land and ensure food security, the specific rules varied across States. They cited examples of various regulations in effect, according to them, in several European countries according to which: (i) a buyer had to show that he was capable of cultivating the bought land (Denmark), (ii) an authority annually inspected the use to which the buyer had put the acquired agricultural land (Austria), and (iii) sales of agricultural land were subject to the approval of a public authority (Sweden). The measure chosen by Parliament was within its power to regulate the economy as it saw fit and had broad public support.

86.  The applicants had not had to bear an individual and excessive burden. Their predecessorsintitle had obtained their shares of land of their free will, and the applicantshad freely chosen to accept them as their inheritance. When the applicants had obtained the land, they had known about the restrictions it was subject to, either those imposed within the framework of the moratorium in the 2001 Land Code or those set out in the 1990 Land Code (see paragraph 10 above). There had never been any undertaking on the part of the State that those restrictions would not be extended beyond the original deadlines which had been in effect when the applicants had acquired the land.

87.  The applicants had received their land free of charge. Other than alienation and change of designated use they were not limited in their rights: they could cultivate the land themselves or rent it out to tenants on freely negotiated terms.

88.  In response to the applicants’argument that engaging in cultivation had not been a practical possibility for them due to the small size of their holdings, the Government submitted that farms of two to five hectares, comparable in size to those of the applicants, made up a sizeable proportion of all agricultural holdings in Europe. In this connection,they cited the 2013 Farm Structure Survey published by Eurostat[25]according to which 4.9 million agricultural holdings, close to half of all holdings in the 28 EU Member States, were less than two hectares in size. In any event, given that the applicants did not see farming as practical, it was unclear why they had volunteered to obtain their land, zoned for farming, in the first place.

89.  Certainly, there could be objective obstacles to farming but the applicants also had the right to rent out their land and this right was not subject to any restrictions.In fact the State was not depriving the applicants of income from their property. On the contrary, the State had taken steps to encourage a rise in rental income: while there were no caps on rent rates, a presidential decree had sought to ensure the observance of a minimum rent rate, at a level of 3% of the land’s value (see paragraph 33 above). In fact, the majority of leases nationwide provided for even higher levels of rent than this minimum (see paragraph 35 above). Renting out land was a popular means of obtaining benefits of ownership for Ukrainian landowners, as evidenced by the large number of land leases in effect and the land area covered by them (see paragraph 35 above). Both applicants had also taken this opportunity and had rented out their land.

90.  As to the right to sell, Article 1 of Protocol No. 1 to the Convention guaranteed no right to acquire property or obtain profit (citing, in particular, R & L, s.r.o. and Others v. the Czech Republic, cited above, 103) and the State had at no time guaranteed to the applicants that they would be able to derive profit from the sale of their land. In the context of “control” of the use of property, which was the case here, the requirement to compensate for interferences with property rights had only a limited application.Here, the applicants were aware of the principle that no compensation in principle would be payable (citing Depalle v. France [GC], no. 34044/02, § 91, ECHR 2010) and had not invested anything into the property (citing Pindstrup Mosebrug A/S v. Denmark (dec.), no. 34943/06, 3 June 2008). Moreover, even if compensation were needed, the State policies aimed at protecting the rights of landlords and propping up of rent rates amounted to such compensation.

91.  The Government also stressed that the moratorium applied to all agricultural land without distinction. The Government cited in this connection the Court’s decision in Lohuis and Others v. the Netherlands, where theCourt found it relevant that the legislation in issue in that case was intended to reduce the environmental impact on an “entire farming sector” (no. 37265/10, 30 April 2013). They also referred to the Court’s decision in Pindstrup Mosebrug (cited above) dealing with a general regulatory act requiring the preservation of bogs and a general limitation on the right to extract peat.

92.  Accordingly, for the Government, the moratorium did not impose an individual and excessive burden on the applicants, and a fair balance had been struck between the interests of the community and those of the applicants.

(b)  Third-party intervener

93.  EasyBusiness submitted certain information concerning the history of the land reform in Ukraine and the structure of its agricultural sector. In particular, according to them, from 1996 to 2009 two thirds of Ukraine’s agricultural land wastransferred into private ownership and94% of the rural population convertedtheir shares of land into land plots. As a result, legally the land wasfragmented into small parcels. However, agricultural production had not been so fragmented since in practice the agricultural producers rented large areas from numerous owners, with the ten top agricultural companies renting from 150 to 654 thousand hectares. They were using the resulting economies of scale to accumulate additional financial resources which in turn skewed the balance in the rental market in their favour.

94.  The intervenerargued that the moratorium violated the constitutional provisions guaranteeing property rights (see paragraphs 24 and 25 above). It prevented the creation of a transparent land market and owners from earning adequate income from their land.

95.  The existing situation did not mean that there was no market in land, but rather that it was non-transparent, leading economic players to use devious schemes to ensure control over land. It had also led to concentration of control over land in the hands of agricultural holding companies which, as the most commontenants, had disproportionate power over small land owners (the average plot size being four hectares) who had no choice but to accept low rents. The land market was fairly monopolised with the 100 biggest players renting 6.5 million hectares. This had led to abnormally low rents. The interveners pointed out that about two thirds of the seven million individuals who had obtained land in the course of privatisation were senior citizens, the average age of a landowner being fifty-seven, and 79% of them being over fifty.

96.  The interveners considered the risks advanced to justify the continuation of the present situation exaggerated. Thus, as to the risk that the land would be sold at meagre prices, international experience showed,to the contrary,that in most countries the creation of a free land market had led to an increase in the value of land.As to the risk of land being bought out by foreigners, no international financial entity possessed the financial resources necessary to buy up the land in quantities which would constitute a threat and high land fragmentation made this risk even less realistic. As to the possible lifting of the moratorium increasing the pressure on small farmers, the interveners considered, to the contrary, that the lifting of the moratorium would be beneficial to them by increasing their access to financing.

2.  The Court’s assessment

(a)  General principles

(i)  The structure of Article 1 of Protocol No. 1

97.  The Court reiterates that, according to its case-law, Article 1 of Protocol No. 1, which guarantees in substance the right of property, comprises three distinct rules: the first, which is expressed in the first sentence of the first paragraph and is of a general nature, lays down the principle of peaceful enjoyment of property. The second rule, in the second sentence of the same paragraph, covers deprivation of possessions and subjects it to certain conditions. The third, contained in the second paragraph, recognises that the Contracting States are entitled, among other things, to control the use of property in accordance with the general interest (see Depalle, cited above, § 77).

(ii)  Lawfulness

98.  The first and most important requirement of Article 1 of Protocol No. 1 is that any interference by a public authority with the peaceful enjoyment of possessions should be lawful: the second sentence of the first paragraph authorises a deprivation of possessions only “subject to the conditions provided for by law” and the second paragraph recognises that States have the right to control the use of property by enforcing “laws”. Moreover, the rule of law, one of the fundamental principles of a democratic society, is inherent in all the Articles of the Convention. The principle of lawfulness also presupposes that the applicable provisions of domestic law are sufficiently accessible, precise and foreseeable in their application (see Broniowski v. Poland [GC], no. 31443/96, § 147, ECHR 2004‑V).

(iii)  General interest

99.  Any interference with the enjoyment of a Convention right must pursue a legitimate aim. Similarly, in cases involving a positive duty, there must be a legitimate justification for the State’s inaction. The principle of a “fair balance” inherent in Article 1 of Protocol No. 1 itself presupposes the existence of a general interest of the community. Moreover, it should be reiterated that the various rules incorporated in Article 1 of Protocol No. 1 are not distinct, in the sense of being unconnected, and that the second and third rules are concerned only with particular instances of interference with the right to the peaceful enjoyment of property. One of the effects of this is that the existence of a public interest required under the second sentence, or the general interest referred to in the second paragraph, are corollaries of the principle set forth in the first sentence, so that an interference with the exercise of the right to the peaceful enjoyment of possessions within the meaning of the first sentence of Article 1 of Protocol No. 1 must also pursue an aim in the public interest (see Ališić and Others v. Bosnia and Herzegovina, Croatia, Serbia, Slovenia and the former Yugoslav Republic of Macedonia [GC], 60642/08, § 105, ECHR 2014).

100.  Because of their direct knowledge of their society and its needs, the national authorities are in principle better placed than the international judge to appreciate what is “in the public interest”. Under the system of protection established by the Convention, it is thus for the national authorities to make the initial assessment as to the existence of a problem of public concern warranting measures to be applied in the sphere of the exercise of the right of property. Since the margin of appreciation available to the legislature in implementing social and economic policies is wide, the Court will respect the legislature’s judgment as to what is in the public interest, unless that judgment is manifestly without reasonable foundation (ibid., § 106).

(iv)  Proportionality

101.  Not only must an interference with the right of property pursue, on the facts as well as in principle, a “legitimate aim” in the “general interest”, but there must also be a reasonable relationship of proportionality between the means employed and the aim sought to be realised by any measures applied by the State, including measures designed to control the use of the individual’s property. That requirement is expressed by the notion of a “fair balance” that must be struck between the demands of the general interest of the community and the requirements of the protection of the individual’s fundamental rights. The concern to achieve this balance is reflected in the structure of Article 1 of Protocol No. 1 as a whole. In each case involving an alleged violation of that Article the Court must therefore ascertain whether by reason of the State’s interference the person concerned had to bear a disproportionate and excessive burden (seeHutten-Czapska v. Poland [GC], no. 35014/97, § 167, ECHR 2006‑VIII).

102.  In assessing compliance with Article 1 of Protocol No. 1, the Court must make an overall examination of the various interests in issue, bearing in mind that the Convention is intended to safeguard rights that are “practical and effective”. It must look behind appearances and investigate the realities of the situation complained of. That assessment may involve not only the relevant compensation terms – if the situation is akin to the taking of property – but also the conduct of the parties, including the means employed by the State and their implementation. In that context, it should be stressed that uncertainty – be it legislative, administrative or arising from practices applied by the authorities – is a factor to be taken into account in assessing the State’s conduct (see Broniowski, cited above, § 151).

103.  In the context of housing regulations, the Court has also held that its assessment of compliance with Article 1 of Protocol No. 1 may involve not only the conditions of the rent received by individual landlords and the extent of the State’s interference with freedom of contract and contractual relations in the lease market, but also the existence of procedural and other safeguards ensuring that the operation of the system and its impact on a landlord’s property rights are neither arbitrary nor unforeseeable (see Amato Gauci v. Malta, no. 47045/06, § 58, 15 September 2009).

(b)  Application of the above principles to the present case

(i)  Whether there is aninterference and the applicable rule

104.  The Court sees no reason to disagree with the parties and finds that the impugned legislative situation constitutes an interference with the applicants’ possessions attracting the application of Article 1 of Protocol No. 1 to the Convention and that it is the rule on control of the use of property that applies (see, mutatis mutandis, Marckx v. Belgium, 13 June 1979, § 64, Series A no. 31; Immobiliare Saffi v. Italy [GC], no. 22774/93, § 46, ECHR 1999‑V; Hutten-Czapska, cited above, §§ 160 and 161;Lindheim and Others v. Norway, nos. 13221/08 and 2139/10, §§ 76-78, 12 June 2012; and Herrmann v. Germany [GC], 9300/07, § 73, 26 June 2012, with further references therein). It notes, moreover, that even if the situation were to be analysed in terms of the respondent State’s positive obligation, the applicable principles would be similar (see Broniowski, cited above, § 146).

(ii)  Lawfulness

105.  The Court notes that the moratorium and its extensions clearly have basis in domestic law which has never been declared unconstitutional (contrast Hutten-Czapska, cited above, § 172, where a subsequent declaration of unconstitutionality nevertheless did not render the relevant measures “unlawful” for the purposes of Article 1 of Protocol No. 1, and R & L, s.r.o. and Others v. the Czech Republic, cited above, §§ 117-126, where a violation of Article 1 of Protocol No. 1 was found in a situation where the Czech Constitutional Court had declared the rent-control scheme unconstitutional but the legislature then failed to pass new legislation regulating the matter within the timeallotted by the Constitutional Court).

106.  The Court notes the applicants’ argument that the uncertainty created by the repeated extensions of the moratorium and the repeated failure of Parliament and the government to respect self-imposed deadlines for the creation of a sales marketin agricultural land rendered the relevant legislation unforeseeable. However, it considers that this argument is rather relevant for determining whether the authorities struck a fair balance between the interests involved (see Hutten-Czapska, § 172, and Broniowski, § 151, both cited above).

107.  Therefore, it considers that restrictions imposed on the exercise of the applicants’ rights complied with the requirement of “lawfulness” inherent in Article 1 of Protocol No. 1.

(iii)  General interest

108.  The Court has considered the aims of the impugned legislative restrictions invoked by the Government, most notably the avoidance of excessive concentration of land in the hands of wealthy individuals or hostile powers, its withdrawal from cultivation, the desire to avoid landlessness and impoverishment of the rural population, all servingthe needsofnational and food security (see paragraph 76 above). It considers that the domestic authorities’ judgment that the maintenance of the moratorium on land sales served those goals cannot be said to be “manifestly without reasonable foundation”.

109.  This conclusion is not disturbed by the apparent mismatch between the pronounced goals of the moratorium, namely the need to prepare the market infrastructure, and the apparent lack of tangible progress in that direction. It is true that this mismatch could raise doubts as to whether the extensions of the moratorium beyond a certain point had been a reasonable means of achieving the proclaimed aims. However, the Court considers that that matter, like the question of uncertainty created by the repeated extension of the deadlines for lifting the moratorium (see paragraph 106above), should be examined in the context of the proportionality of the impugned measures (see, mutatis mutandis, Bittó and Others v. Slovakia, 30255/09, § 109, 28 January 2014, where the Court considered the mismatch between the Government policy plans which envisaged the introduction of market-level rents and the actual lack of progress in that direction as a factor in assessing the proportionality of the rent control measures which affected the applicants).

(iv)  Proportionality

110.  The Court notes that it is not its role to decide in principle whether a State which has decided to transfer previously State-owned land into private hands should or should not then allow the new owners to sell it and under what conditions. Under the Court’s well-established case-law, its task is not to review domestic law in abstracto, but to determine whether the manner in which it was applied to, or affected, the applicants gave rise to a violation of the Convention (see Garib v. the Netherlands [GC], 43494/09, § 136, 6 November 2017).

111.  In this context the Court must stress its fundamentally subsidiary role. The Contracting Parties, in accordance with the principle of subsidiarity, have the primary responsibility to secure the rights and freedoms defined in the Convention and the Protocols thereto, and in doing so they enjoy a margin of appreciation, subject to the supervisory jurisdiction of the Court. The national authorities have direct democratic legitimation and are, as the Court has held on many occasions, in principle better placed than an international court to evaluate local needs and conditions. In matters of general policy, on which opinions within a democratic society may reasonably differ widely, the role of the domestic policy-maker should be given special weight (, § 137).

112.  It is therefore important for the Court’s analysis of the situation affecting the applicants that the respondent State has consistently, throughout the period during which the moratorium has remained in place, declared the creation ofa sales market in agricultural land and eventual discontinuation of the moratorium as its goal (see paragraphs 36 to 43 above). In view of the principle of subsidiarity, the Court can only assess the situation in the light of this goal defined by the respondent State itself and cannot substitute its own judgment as to whether it would be desirable to have a land sales market for that consistently reached and proclaimed by the domestic authorities themselves.

113.  Evaluating the legislative restrictions affecting the applicants’ property rights in the light of those considerations, the Court finds the following factors relevant.

(α)  Legislative uncertainty

114.  Even though throughout the relevant period the legislature’s proclaimed eventual goal has remained the eventual introduction of a land sales market and the lifting of the moratorium, the motives for its introduction and maintenance, its scope and the end point have evolved considerably over time.

115.  A large part of the motivation behind the initial moratorium appears to have been the lack of a transparent system of title registration for shares of land and the need to complete their conversion into defined land parcels with a formal title (see paragraphs 15, 36 and 37 above), a process which was already advanced in 2003 and appears to have been largely completed by 2009 (see paragraphs 15 and 93 above). While this initial reason largely disappeared, the ban initially introduced primarily for shares of land (see paragraphs 16 and 19 above), was extended to plots with clear registered title, such as those owned by the applicants.

116.  In apparent contradiction with the goal of eventually creating a land sales market, almost all changes in the moratorium following its initial adoption were in fact aimed at tightening rather than gradually loosening restrictions, even though it is understandable that some of those changes may have been needed to prevent operations aimed at circumventing the moratorium (see, for example, row 2 of the Table at paragraph 21 above). The domestic authorities also apparently hesitated in determining the desirable scope of the moratorium, as is shown for example by theirfirst allowing, then banning and then allowing again swap transactions within the space of five years (see paragraph 19and rows1 and 3of the Table at paragraph 21 above).

117.  The end date of the moratorium underwent even more significant changes. The provision of the Land Code which introduced the initial moratorium and its first two extensions provided specific deadlines for its expiry. Accordingly, at that time Parliament had to take action and legislate if it wished to keep the moratorium in place. The Laws of 28 December 2007 and 3 June 2008 (see row4of the Table) changed that, effectively removing the specific end date and reversing the situation, which required Parliament to act and legislate if it wished to discontinue the moratorium. It appears that no specific reason has been given for this key change.

118.  Moreover, it appears that, whilethe authorities consideredthe initialend date of the moratorium as the actual date by which the land market infrastructure had to be put in place and by which the moratorium was actually expected to expire, currently the moratorium is treated as, for all practical purposes, indefinite, despite the periodically set deadlines for the development of legislation which would regulate the land sales market and lift the moratorium which appear to be routinely pushed back (contrast the presidential address of 2002 at paragraph 36above with that of 2017 at paragraph 42above; see also, concerning failure to respect the self-imposed deadlines for development of the legislation,rows 10-12 of the Table and paragraph 43above).

119.  The Court has on many occasions stressed the need to look beyond appearances and the language used and to concentrate on the realities of the situation (see, for example, Blokhin v. Russia [GC], no. 47152/06, § 180, ECHR 2016). Applying this approach, the Court observes that the nature of the moratorium changed after theenactment of the above-mentioned laws of December 2007 and June 2008 and the moratorium became de facto indefinite and the conditions for its lifting indeterminate. No reason was given for this change. This change is also in apparent contradiction with the proclaimed aim of the gradual introduction of a land sales market.

120.  In Bittó(cited above, §§ 108-110) the Court, in finding the then Slovakian rent-control scheme incompatible with Article 1 of Protocol No. 1, found it relevant that the scheme had been kept in place despite repeatedly announced Government policy plans envisagingthe introduction of market-level rents.Likewise, in Skibińscy v. Poland (no. 52589/99, §§ 94-98, 14 November 2006), the Court found that repeated extensions of the rent-control scheme, initially justified in view of the transition from a State-controlled to a market economy, meant that a fair balance had not been struck between the competing general and individual interests.In Sporrong and Lönnroth (cited above, § 70), it was also relevant that the repeated extension of expropriation permits which restricted the full exercise of the applicants’ ownership rights had left the applicants in “complete uncertainty as to the fate of their properties” which was a factor in the Court finding a violation of the applicants’ property rights in that case.

121.  Similarly, in the present case, the lack of consistency on the part of the authorities in modifying the scope and the very nature of the moratorium and the uncertainty it has createdare important factors in the Court’s assessment of the proportionality of the impugned situation (see Broniowski, cited above, § 151).

(β)  Reasons advanced for the introduction and maintenance of the moratorium

122.  The Court notes that the Government did not advance any specific reasons as to exactly why the domestic authorities considered the temporary blanket ban on land sales as the only appropriate measure of achieving their desired social and economic goals, whether it seriously considered other means of achieving them short of a total ban or assessed the proportionality of a total ban to the aims sought (compare, in the context of Article 3 of Protocol No. 1, Hirst v. the United Kingdom (no. 2) [GC], no. 74025/01, § 79, ECHR 2005‑IX). Even though the Government did not advance this argument explicitly, the Court is prepared to accept that the reason for the choice of the temporary blanket ban may have been implicit in the initial moratorium, namely that time was needed to develop a land market infrastructure, which would supposedly include the consideration of less restrictive alternatives to a total ban. However, once the nature of that initial moratorium changed and the specific end date for its expiry was removed (see paragraph 119 above), no specific reasons were given for the continuing failure to legislate and consider such less restrictive alternatives.

123.  Likewise, while the Constitutional Court examined the admissibility of the constitutional review application concerning the 2016 “extension” of the moratorium (see paragraph 26 above), it found the arguments presented in support of that application for abstract review insufficiently developed to permit the opening of the constitutional review proceedings and its substantive examination. In such circumstances it appears that the Constitutional Court was prevented from engaging in any detail with the substance of the matter, in particular the reasons for the introduction and maintenance of the moratorium and the question of balancing of the relevant interests (contrast Jahn and Others v. Germany [GC], nos. 46720/99 and 2 others, § 116, ECHR 2005‑VI, and in the context of Article 10, Animal Defenders International v. the United Kingdom [GC], no. 48876/08, §§ 13‑33 and 113-16, ECHR 2013 (extracts)).

124.  In the proceedings before the Court the Government argued that the moratorium was needed to avoid the following key risks: (i) impoverishment of the rural population, (ii) excessive concentration of land in the hands of wealthy individuals or hostile powers, and (iii) its withdrawal from cultivation.

125.  The concern that the lifting of the moratorium may lead to the impoverishment of the rural populationand farmers does not addressthe situation of owners such as the applicants who reside in urban areas anddo not work in farming. The applicants consider that for them farming is not a viable optionin view of their age and the distances involved (see paragraphs 6, 7and 81above), an assessment which the Court finds reasonable. As to the risk of impoverishing the rural population generally, the Court notes that the makers of the laws which extend the moratorium appear to acknowledge that the absolute prohibition on sales was not needed as such to achieve that goal but rather served to provide time to develop the necessary legislation introducing appropriate safeguards to ensure a well-regulated land sales market (see, for example, rows3 and10-13 of the Table at paragraph 21 above).

126.  As to the aims of preventing excessive concentration of land and its withdrawal from cultivation, the Court observes that Ukrainian law already contains certain provisions which appear to be aimed at achieving the same result. These include: (i)the taxation regime which would appear to benefit cultivated land and penalise its withdrawal from cultivation (see paragraph 27 above), (ii)the restrictions on the categories of those who can own land, and (iii) the caps on the maximum amount of land owned (see paragraphs 29 to 32 above). A number of further restrictions were also contemplatedin the draft Land Market Act, which was approved by Parliament at the first reading in 2011 but did not advance further(see row 7 of the Table and paragraph 40 above). It is notable in this connection that the enactment of the Land Market Act, along with the State Land Cadastre Act, was, until 20 November 2012, defined as the key prerequisite for lifting the moratorium (see row8of the Table).

127.  It is also relevant in this connection that no other Council of Europe member State, including those who have undergone transition from State-controlled to market economies and have implemented land reform programmes, have in placeblanket restrictions on the sale of agricultural land (see paragraphs 45 and 46 above) which would be analogous to the situation existing in Ukraine. Comparative law research demonstrates that in many of those States the authorities apparently pursue largely the same goals of ensuring the effective use of land for agricultural production and the avoidance of excessive concentration of land holdings, particularlyin the hands of economic players not engaged in local rural life and farming. However, that research demonstrates that the authorities in those countries have at their disposal a wide range of other legislative tools which appear to adequately address those goals without the need to have recourse to a total ban on sales (see paragraphs47 to 54 above).

128.  Certainly, it is an established case-law principle that where the legislature has made a choice by enacting laws which it considers to be in the general interest, the possible existence of alternative solutions does not in itself undermine the validity of the justification behind the contested legislation because specific circumstances may warrant it. It is not for the Court to say whether the legislation represented the best solution, provided that the authorities remain within the bounds of their margin of appreciation (see, for example, Bečvář and Bečvářová v. the Czech Republic, no. 58358/00, § 66, 14 December 2004).It remains the case, however, that reasons need to be shown for the choice of a more restrictive solution andthe existence of alternative solutions does constitute a factorrelevant for determining whether the means chosen could be regarded as reasonable and suited to achieving the legitimate aim being pursued, having regard to the need to strike a “fair balance” (see James and Others v. the United Kingdom, 21 February 1986, § 51, Series A no. 98).

129.  In that context, the Court would reiterate once again that in the present case it is the Ukrainian authorities themselves who have consistently, for nearly two decades, defined their goal as the eventual introduction of a well-regulated land sales market, the moratorium being only an intermediate step to that end.The very nature of the moratorium and the proclaimed goal for its introduction and extension was essentially to have time to consider possible alternatives to the absolute ban on sales. That such alternatives were available and would be suitable to achieve the same goals has been repeatedly recognised at the highest levels of the respondent State (see, for example, paragraphs36to 42 above).

130.  Given that the authorities proclaimed the creation of such a market as their goal, the availability of alternative solutions and thelack of consistent reasons given for not adopting those solutions and keeping in place the most restrictive one, must have a substantial weightin the assessment of thelatter’s proportionality.

(γ)  The burden imposed on the applicants

131.  In assessing the burden the impugned situation imposes on the applicants, the Government pointed out that the applicants had obtained their land of their free will at a time when it had already beensubject to the legislative restrictions in question.

132.  Indeed, when the second applicantcame into possession of the land he had to be aware that it was already subject to restrictive regulations on its sale (compare,mutatis mutandis,Fredin v. Sweden (no. 1), 18 February 1991, § 54, Series A no. 192) and it could not be ruled out that the prohibition could be extended (compare Depalle, cited above, § 86). However, the second applicant inherited his land in November 2004, shortly after the first extension of the moratorium (see paragraph 7 and row1 of the Table at paragraph 21 above). As the Court has noted above (see paragraphs 118 and 119), at that time the officially proclaimed expectation had been that the moratorium would actually expire on a defined date, and the nature of the moratorium changed and the prospects of it being lifted became much more uncertain at a later date, after the enactment of the laws of December 2007 and June 2008 (see row 4 of the Table).

133.  The first applicant’s situation is somewhat different. When her share of landwas converted into a plot, on 10 January 2006, the moratorium did not apply to land of her category, zoned for use as an individual smallholding. It was extended to that type of land somewhat later, by the Law of 19 December 2006 (see row3 of the Table). Therefore, it cannot be said that the first applicant acquired her land when it was already subject to the moratorium.

134.  Whatever the details of their situation, however, when the applicants obtained rights to their land, the law applicable to it was clearly in flux. Moreover, the Court does not lose sight of the fact that both applicants obtained the land as a result of a far-reaching land reform which had not been completed by the time they came into possession of it (compare Jahn, cited above, § 116).

135.  On the other hand, the applicants inherited the land from their parents rather than acquired it in a commercial transaction (contrast, for example,Pine Valley Developments Ltd and Others v. Ireland, 29 November 1991, § 59, Series A no. 222). Moreover, given the Land Code’s pronounced policy of eventually opening up agricultural land to the market, which was particularly clear in the initial stages of the moratorium, they could not expect that the absolute prohibition would continue indefinitely.

136.  Therefore, it cannot be said that the applicants had to know from the start that they were coming into possession of encumbered property which would remain so encumbered save for the eventuality of some uncertain future development (contrast, for example,Depalle, cited above;Lacz v. Poland (dec.), no. 22665/02, 23 June 2009; andHåkansson and Sturesson v. Sweden, 21 February 1990, § 53, Series A no. 171‑A).

137.  As to the financial aspect of the burden imposed on the applicants, the Court recognises that it is not as severe as that imposed, for example, on owners by some rent-control schemes which it has had occasion to examine in its previous judgments (see, for example, Hutten-Czapska, § 198, andR & L, s.r.o. and Others v. the Czech Republic, § 104, both cited above, where rents were demonstrably below maintenance costs; see alsoGhigo, cited above, § 66, and Edwards v. Malta, no.17647/04, § 75, 24 October 2006, where this was not necessarily the case but the statutory rent for houses, amounting to less than five or six euros per month, was extremely low and demonstrably below market rates).

138.  As the Government pointed out, and contrary to those rent-control cases, the applicants in the present case remain free to rent their land out at market rates.The respondent State does not cap those rates but rather takes measures to prop them up to the owners’ benefit by setting minimum rents. While these minimum rents are, legally speaking, indicative rather than binding, as a matter of practice they appear to be followed in the majority of cases (see paragraph 33 above).

139.  These positive aspects, however, are offset,to some extent, by certain other aspects of domestic law. Notably, tax law would appear to penalise owners who do not lease their land to agricultural producers and benefit those who do (see paragraph 27 above), even though the applicants would in any case appear to be entitled to a tax exemption due to their advanced age. Moreover, rules fixing the minimum duration of land leases at seven years also apparently aim to create stability for tenants but, by the same token, likely further restrict the owners’ ability to seek higher rents in the process of lease renegotiation (see paragraph 34 above). It is also reasonable to assume that, as has been suggested (see paragraphs 82 and95above), the moratorium exercises a certain downward pressure on rents even though it is difficult to determine its precise extent, given there has never, in recent decades, been a functional land sales market in Ukraine (compare Chiragov and Others v. Armenia (just satisfaction) [GC], 13216/05, § 68, 12 December 2017).

140.  It should also be noted that in the above-mentioned cases rent‑control measures were motivated by concern for the social rights of third parties, often vulnerable categories of the population, whom the rent‑control schemes aimed to protect. This consideration is not necessarily present here, as the applicants’land is rented by commercial enterprises (see paragraphs 6 and 7 above and compare Urbárska Obec Trenčianske Biskupice v. Slovakia, no. 74258/01, § 131, 27 November 2007, where the Court, in finding that the compulsory letting of the land owned by the members of the applicant association and the subsequent transfer of that land to the tenants breached Article 1 of Protocol No. 1, noted that the supposed beneficiaries of those measures did not belong to a socially weak or particularly vulnerable part of the population, with Hutten-Czapska, § 225, where even measures in favour of tenants recognised as vulnerable werefound to be disproportionate). Quite to the contrary, in the present case it is the applicants themselves, as well as other owners,who may be considered vulnerable, if nothing else, at least by reason of their advanced age (see paragraphs 35 (i), 81 and95 above, and, mutatis mutandis, Komnatskyy v. Ukraine, no. 40753/07, § 18, 15 October 2009, and Stoyan Mitev v. Bulgaria, no. 60922/00, § 73, 7 January 2010, where the Court recognised, albeit in different factual contexts, advanced age as one of the factors of the applicants’vulnerability).

141.  The applicants and the third-party intervener suggested, citing certain statistics concerning market concentration, that the maintenance of the moratorium, far from being protective of the interests of vulnerable landowners, could actually favour tenants, many of whom were businesses of considerable size and influence, over such small landowners (see paragraphs 70, 93and 95 above). The Court considers that this is not a case where it can rely on such merely statistical evidence (contrastH. and Others v. the Czech Republic [GC], no. 57325/00, §§ 187-89, ECHR 2007‑IV, concerning the use of statistical evidence in cases concerning discrimination) and the applicants did not submit any evidence showing any abuse of market power by tenants in their particular cases. However, the Government did not specifically challenge their allegation and, most importantly,did not provide any specific evidence to show that, to the contrary, the moratorium served to protect vulnerable categories of the population, rather than disadvantage them.

142.  The Court is also conscious of the fact that the applicants acquired their land free of charge from their parents who, in turn, had obtained it in the process of privatisation of previously publicly owned land. While the parties did not comment on the grounds on which the applicants’ parents obtained their shares of land, the Court notes that such shares were primarily allocated to former members of collective farms, normally based on their work for those enterprises (see paragraph 12 above). The applicants inherited the land in the process of ordinary inheritance. Therefore, it cannot be said that the land in question was a gratuitous windfall for them.

143.  Moreover, according to the Court’s case-law, the fact that a property has been acquired without paymentdoes not rule out a finding of a violation of Article 1 of Protocol No. 1 (see, for example,Edwards, cited above, §§ 5 and 75-79, and Vistiņš and Perepjolkins v. Latvia [GC], 71243/01, § 121, 25 October 2012).The Court considers, however, that this fact may be pertinent in its assessment under Article 41 of the Convention (see paragraph 155below).

144.  In assessing the severity of the burden imposed on the applicants the Court also finds relevant:

(i)  the length of time the restrictions remained in place, which so far has reached seventeen yearsoverall, with the restrictions affecting the first and second applicants personally for more than twelve and ten years respectively (see, for example, Sporrongand Lönnroth, cited above, § 72, andJGK Statyba Ltd and Guselnikovas v. Lithuania, no. 3330/12, § 143, 5 November 2013, where restrictions on the full enjoyment of property rights lasted for twelve and more than ten years respectively),

(ii)  the broad scope of restrictions, in that they prevent the applicants from both alienatingtheir land in nearly every possible fashion andusing it for any other purpose than agriculture, and

(iii)  the blanket and inflexible nature of the restrictions, which are not subject to any individual review or exception (compareImmobiliare Saffi, cited above, § 54, where the Court found a violation of Article 1 of Protocol No. 1 in part because nocourt had jurisdiction to rule on the impact which the delay in enforcing eviction orders might have in a particular owner’s case,with Spadea and Scalabrino v. Italy, no. 12868/87, §§ 37-40, 28 September 1995, andLohuis, cited above, § 59, where such provision for individual hardship cases was made, and P. Plaisier B.V. and Others v. the Netherlands (dec.), nos. 46184/16, 47789/16 and 19958/17, § 91, 14 November 2017, where an individualised assessment of the severity of the burden imposed on the applicant by domestic courts was not excluded).

145.  The latter feature of the legal regime to which the applicants are subject means that the proportionality of the measure restricting their rights has not been substantively examined either at the legislative (see paragraph 122above) or the individual level.

146.  Lastly, the above-mentioned uncertainty created by the repeated extensions of the moratoriumhas in itself contributed to the burden imposed on the applicants. Realisation of one of the key elements of their ownership, the right to dispose of one’s property (see paragraph 28 above), became subject to the passage of legislation of indefinite content, passage which has been postponed in a fashion which appears unpredictable and insufficiently explained (see paragraphs118, 119 and 122above). Their ownership rights were rendered, in practical terms, precarious and defeasible. This should be seen in the light of the long-standing principle of the Court’s case-law that the Convention  should be interpreted and applied in a manner which renders its guarantees practical and effective and not theoretical and illusory (see, mutatis mutandis,Paposhvili v. Belgium [GC], no. 41738/10, § 182, ECHR 2016, with further references therein).

147.  The Court concludes that the applicants have been made to bear as individuals the burden of the authorities’ failure to meet their self-imposed goals and deadlines. In view of the weakness of the reasons given for the choice of the most restrictive alternative available to the authorities over less restrictive measures, the Court considers that the burden imposed on the applicantsis excessive.

(v)  Conclusion

148.  In view of the above considerations and the Government’s failure to advance sufficient reasons to justify the measures applicable to the applicants’ land, the Court concludes that the respondent State has overstepped its wide margin of appreciation in this area and has not struck a fair balance between the general interest of the community and the property rights of the applicants.

149.  There has accordingly been a violation of Article 1 of Protocol No. 1.

III.  APPLICATION OF ARTICLES 46 AND 41 OF THE CONVENTION

A.  Article 46 of the Convention

150.  The Court stresses that the problem underlying the violation of Article 1 of Protocol No. 1 concerns the legislative situation itself and that its findings extend beyond the sole interests of the applicants in the instant case. The Court considers that the respondent State should take appropriate legislative and/or other general measuresto ensure a fair balance between the interests of agricultural land owners on the one hand, and the general interests of the community, on the other hand, in accordance with the principles of protection of property rights under the Convention. It is not for the Court to specify how those interests should be balanced. Under Article 46 the State remains free to choose the means by which it will discharge its obligations arising from the execution of the Court’s judgment (see, mutatis mutandis, Hutten-Czapska, cited above, §§ 237 and 238, and Lindheim, cited above, § 137). The Court’s judgment should not be understood to mean that an unrestricted market in agricultural land has to be introduced in Ukraine immediately.

B.  Article 41 of the Convention

151.  Article 41 of the Convention provides:

“If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party.”

1.  Damage

152.  The applicants claimed 30,000 euros (EUR) each in respect of non‑pecuniary damage.

153.  The Government considered the amounts claimed exorbitant and unsubstantiated.

154.  The Court observes that the applicants did not submit a claim for pecuniary damage. Moreover, it considers that, in the absence of a functioning market for agricultural land in Ukraine, any such claim would likely be speculative (see paragraph 139 above).

155.  Concerning the matter of non-pecuniary damage, the Court reiterates that situations where the applicant has suffered evident trauma, whether physical or psychological, pain and suffering, distress, anxiety, frustration, feelings of injustice or humiliation, prolonged uncertainty, disruption to life, or real loss of opportunity can be distinguished from those situations where the public vindication of the wrong suffered by the applicant, in a judgment binding on the Contracting State, is an appropriate form of redress in itself. In some situations, where a law, procedure or practice has been found to fall short of Convention standards, this is enough to put matters right (see, for example, Chiragov, cited above, § 57, with further reference therein).

156.  In view of these principles, the Court considers that the finding of a violation constitutes in itself sufficient just satisfaction for any non‑pecuniary damage sustained by the applicants. In making this finding the Court has regard, inter alia, to its findings in paragraphs138 and143above as to the nature of the burden the present legislative situation has imposed on the applicants, its holding that the respondent State must take appropriate legislative and/or other general measures to secure compliance with Article 1 of Protocol No. 1 (see, mutatis mutandis, Lindheim, cited above, § 141) and to the fact that an exceptionally large number of individuals are affected by the moratorium (see paragraphs 15 and 95 above and, mutatis mutandis, Chiragov, cited above, § 46, and Edwards v. Malta (just satisfaction), no. 17647/04, § 30, 17 July 2008).

157.  However, the Court stresses that, should the respondentState unreasonably delay adoption of the requisite general execution measures, this may, with the passage of time, lead to a situation where awards under Article 41 may eventually become warranted, at least for some categories of agricultural land owners.

2.  Costs and expenses

158.  The applicants also claimed EUR 4,800each for the costs and expenses incurred before the Court, to be paid directly into Mr Tarakhkalo’s bank account.

159.  The Government contested the reasonability of that claim. They pointed out that the Court awarded EUR 11,000 in legal fees in Kulykov and Others v. Ukraine (nos. 5114/09 and17 others, § 159, 19 January 2017) which, in their estimation, was considerably more complex than the present case.

160.  According to the Court’s case-law, an applicant is entitled to the reimbursement of costs and expenses only in so far as it has been shown that these have been actually and necessarily incurred and are reasonable as to quantum. In the present case, regard being had to the documents in its possession and the above criteria, as well as taking into account the legal aid payment Mr Tarakhkalo has already received, the Court considers it reasonable to award the sum of EUR 3,000to each applicant for the proceedings before the Court, to be transferred directly into Mr Tarakhkalo’s bank account.

161.  The Court would also stress that, even though it makesan award for legal fees in the present case, it would be difficult for it to envisage making any awards for costs and expenses in any follow-up cases of this type, unless very exceptional circumstances justified a different conclusion.

C.  Default interest

162.  The Court considers it appropriate that the default interest rate should be based on the marginal lending rate of the European Central Bank, to which should be added three percentage points.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1.  Decides to join the applications;

2.  Declaresthe applications admissible;

3.  Holdsthat there has been a violation of Article 1 of Protocol No. 1 to the Convention;

4.  Holds that the finding of a violation constitutes in itself sufficient just satisfaction for any non-pecuniary damage sustained by the applicants;

5.  Holds

(a)  that the respondent State is to pay, within three months from the date on which the judgment becomes final in accordance with Article 44 § 2 of the Convention, EUR 3,000 (three thousand euros) to each applicant, plus any tax that may be chargeable to the applicants, in respect of costs and expenses, to be converted into the currency of the respondent State at the rate applicable at the date of settlement and to be transferred directly into the account of the applicants’ lawyer Mr Tarakhkalo;

(b)  that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amount at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

6.  Dismissesthe remainder of the applicants’ claim for just satisfaction.

Done in English, and notified in writing on 22 May 2018, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Marialena Tsirli                                                             Vincent A. De Gaetano
Registrar                                                                              President

______________

[1].  For example, just the World Bank’s Ukraine Rural Land Titling & Cadastre Development Project, which ran from 2003 to 2013, alone funded the issuance of 711,678 land titles and the digitisation of 16,7 million title records. See at http://documents.worldbank.org/curated/en/236291467986261763/Ukraine-Rural-Land-Titling-and-Cadastre-Development-Project and http://www.worldbank.org/uk/news/press-release/2013/02/21/world-bank-mission-on-ukraine-rural-land-titling-and-cadaster-development-project-completes-implementation-support-visit (last visited 5 January 2018).

[2].  This gives a rate of 1.56%. While this indicates the number of transactions and not area covered, in some EU countries the annual rate of transactions consistently exceeds 2% of the total utilised agricultural area (UAA). See European Centre for Policy Studies. Study on the Functioning of Land Markets in the EU Member States under the Influence of Measures Applied under the Common Agricultural Policy: Final Report (Johan Swinnen, Pavel Ciaian and d’Artis Kancs), p. 182, available at https://ec.europa.eu/agriculture/sites/agriculture/files/…/landmarkets/report_en.pdf

[3].  See at http://iportal.rada.gov.ua/meeting/stenogr/show/3422.html (last visited 5 January 2018). See also § 30 of the Government’s Observations.

[4].  Available at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=26841 (last visited 5 January 2018).

[5].  28 December 2007 is the date of passage of the 2008 Budget Act which also contained a provision modifying the end point of the moratorium, along with many other amendments to various laws, primarily concerning various sources of revenue. However, on 22 May 2008 the Constitutional Court declared the relevant provisions of the 2008 Budget Act unconstitutional for procedural reasons unrelated to the land legislation and the moratorium. The same provision concerning modification of the end date of the moratorium was then re-enacted as a separate law on 3 June 2008.

[6].  See explanatory notes at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=31175 and http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=32472 respectively (last visited 10 January 2018).

[7].  Transcript of Parliament’s meeting is available at http://iportal.rada.gov.ua/meeting/stenogr/show/1199.html

[8].  Draft law no. 5123-1, available at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=60199.The transcript of the Parliamentary debate is available at http://iportal.rada.gov.ua/meeting/stenogr/show/6324.html (last visited on 5 January 2018).

[9].  Draft law no. 7350, available at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=63045. The transcript of the Parliamentary debate is available at http://iportal.rada.gov.ua/meeting/stenogr/show/6672.html (last visited on 5 January 2018).

[10].  See https://ukr.lb.ua/economics/2017/02/17/358930_55_nardepiv_poprosili.html (last visited 5 January 2017).

[11].  See http://www.ccu.gov.ua/novyna/konstytuciyni-podannya-za-stanom-na-6-kvitnya-2018-roku.

[12].  Any entity deriving at least three quarters of its turnover from agriculture can benefit from this regime (see Article 291 § 4 (4) of the Tax Code). More details on the special taxation regime for agricultural producers can be found in Doing Agribusiness in Ukraine: Legal Guidance for Foreign Investors (Ministry of Agrarian Policy and Food of Ukraine, 2017), p. 11, available at https://www.agroberichtenbuitenland.nl/documenten/publicaties/2017/10/31/doing-agribusiness-in-ukraine-legal-guidance-for-foreign-investors (last visited 5 January 2017).

[13].  Держгеокадастр, Укладення договорів оренди та плата за оренду земельних часток (паїв) (published 14 September 2015), available at http://land.gov.ua/info/ukladennia-dohovoriv-orendy-ta-plata-za-orendu-zemelnykh-chastok-paiv/ (last visited 8 January 2018).

[14].  Ibid.

[15]. Держгеокадастр. Середня вартість оренди сільгоспземель в Україні у розрізі регіонів (published 4 December 2015) http://land.gov.ua/info/serednia-vartist-orendy-silhospzemel-v-ukraini-u-rozrizi-rehioniv/ (last visited 8 January 2018).

[16].  Послання президента України до Верховної Ради України про внутрішнє і зовнішнє становище України у 2001 році, available http://zakon2.rada.gov.ua/laws/show/n0002100-02 (last visited 8 January 2018).

[17].  See Угоди про створення Коаліції демократичних сил у Верховній Раді України V i VI скликання,http://zakon3.rada.gov.ua/laws/show/en/n0002001-06 and http://zakon3.rada.gov.ua/laws/show/n0003001-07/print respectively (last visited 8 January 2018).

[18].  Cabinet of Ministers’ Resolution no. 14 of 16 January 2008.

[19].  Виступ Президента України Віктора Януковича із щорічним посланням до Верховної Ради України (7 квітня 2011 р.), see at http://meria.sumy.ua/index.php?newsid=28857 (last visited 8 January 2018).

[20]. See at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=41981(last visited 8 January 2018).

[21].  See at http://pavlogradmrada.dp.gov.ua/news/shhorichne-poslannya-prezidenta-ukra%D1%97ni-viktora-yanukovicha-do-verkhovno%D1%97-radi-pro-vnutrishneh-ta-zovnishneh-stanovishhe-ukra%D1%97ni.html (last visited 8 January 2018).

[22]  Transcript of Parliament’s meeting on 6 September 2016, available at http://iportal.rada.gov.ua/meeting/stenogr/show/6284.html (last visited 8 January 2018).

[23].  Available at http://www.president.gov.ua/news/poslannya-prezidenta-ukrayini-do-verhovnoyi-radi-ukrayini-pr-43086 (last visited 4 January 2018).

[24].  However, two drafts of the CALA submitted by two different groups of lawmakers are pending before the Parliament. They are available at http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=60724 (main draft) and

http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=60829 (alternative draft) respectively (last visited 4 January 2018).

[25].  Farm structure survey 2013 – main results, http://ec.europa.eu/eurostat/statistics-explained/index.php/Farm_structure_survey_2013_-_main_results (last visited 9 January 2018).

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