Companies associated with the Privat group have controlled one of the enterprises of the National Academy of Agrarian Sciences in the Dnepropetrovsk region for years, and now they want to take over its 15 thousand hectares. How does the state lose land?
Over the past two decades, the state has significantly less land, notes the Economic Truth publication. However, these are still hundreds of thousands of hectares and they are still the target of attacks for dealers, officials and businessmen who seek to make money from state assets.
Almost every state-owned enterprise that owns land requires close attention. The National Academy of Agrarian Sciences alone (which has up to 400 thousand hectares of land) has dozens of such enterprises, and they periodically surface in corruption scandals.
This story is about one of them - the Dnieper agricultural company “Nauchnaya”, which back in the 1990s “came to light” in the case of the notorious Ukrainian Prime Minister Pavel Lazarenko.
While the company was in bankruptcy, its assets were used by companies associated with the Privat group of Igor Kolomoisky and his partners. When, at the beginning of 2023, the government decided to transfer the company with 15 thousand hectares of land near the Dnieper to the State Property Fund.
A law has come into force according to which forest belts and field roads are also leased
This forced Nauchnaya’s beneficiaries to resort to unexpected steps.
Context
In 2019, Ukrainians were told that there were 10.4 million hectares of state land left in Ukraine, but this turned out to be a lie... A significant part of this land could pass into the hands of private owners, as Roman Leshchenko, the former head of the State GeoCadastre, spoke about three years ago in an interview with EP. Now no one can give an exact figure of how much land the state has left.
The State GeoCadastre did not respond to the EP’s request. According to Deputy Head of the Presidential Office Rostislav Shurma, we are talking about 500-800 thousand hectares. He says that there was no inventory of land, so there is no understanding of how many hectares are in the occupied territory and how much land was taken into private ownership.
The remaining land is managed by various state-owned enterprises. Of these, about half are under the jurisdiction of the structures of the National Academy of Agrarian Sciences. “Unlimited” and “free” access to any resource is a fertile field for abuse and theft, which are regularly identified at NAAS.
Several months ago, the government took steps that could stop such violations. In July, the Verkhovna Rada adopted a law that limited the right of permanent use for state-owned enterprises and gave impetus to the creation of a Land Bank on the basis of the State Property Fund. Shortly before this, the government began to transfer state-owned agricultural firms from the jurisdiction of ministries and NAAN to a single manager - the State Property Fund.
It looks like this process will last more than one year. In most of these farms, the state is present nominally, and their real beneficiaries are trying to maintain the status quo and using all possible means to do this. Just like the scientific agricultural company.
Section 1. History of “Scientific”
In the 1990s, the Naukova agricultural company was a large integrated enterprise that owned almost 25 thousand hectares of arable land, the Dnepropetrovsk distillery and the Dneprodzerzhinsk dairy plant. In 2002, local authorities alienated part of the land and since then the agricultural company has managed 14.5 thousand hectares of land. These sites are located just outside the city limits of Dnieper, in the Dnieper district.
In the early 2000s, Nauchnaya appeared in the Lazarenko case on suspicion of money laundering. Nikolai Agafonov, who managed the enterprise until 1998, was suspected of stealing state property on an especially large scale.
In 2004, the main creditor of Nauchnaya, CJSC KB Privatbank, which was then owned by Igor Kolomoisky and his partners, applied to the Economic Court of the Dnipropetrovsk Region with a request to open a bankruptcy case. The court upheld the claim and Nauchnaya entered bankruptcy proceedings.
As Nikolai Volosyanko, deputy chairman of the Dnepropetrovsk Regional State Administration, noted at the time, Nauchnaya’s debts reached UAH 300 million, half to Privatbank. According to him, the bank planned to pay off debts, invest in production and even provided a plan for the use of land. NAAN supported the initiative.
The agricultural company was headed by Petr Kucherov, who still runs Nauchnaya today. According to Volosyanok, the bank was ready to invest money only with such a designation. This is not surprising, because a person with such a surname and name, according to the YouControl system, is the former director and co-founder of Privat-Agro LLC.
After the bankruptcy procedure began, the court appointed an arbitration manager. He is responsible for the turnaround and would have to develop a plan to restore the company's solvency. The rehabilitation procedure began in 2005 and was supposed to last 12 months, but from year to year the rehabilitation plan was not submitted, and the deadlines were extended.
In 2011, the court declared the company bankrupt and began liquidation proceedings. The transition to the procedure was approved by the committee of creditors and Privatbank. The liquidation, according to the court decision, was supposed to be completed in 2012, but this has not yet happened. In 2019, the court appointed a new liquidator of the agricultural company, Alexander Chikildin.
Section 2. The fight for land: the Privat group against the State Property Fund
In January 2023, the government transferred dozens of state-owned enterprises to the SPF. Among them was “Nauchnaya” with a debt of about 300 million UAH.
Almost immediately after this, the agricultural company appealed in court the act of acceptance and transfer of the enterprise’s unified property complex (we are talking about all assets except land) and has already won in two instances. The legal disputes continue: on October 26, the Supreme Court opened cassation proceedings on the SPF’s complaint.
The single property complex “Nauchnaya” (without land assets) is included in the list of small privatization objects, but the SPFU notes that it will be possible to begin preparing it for sale only after the Supreme Court lifts the ban on the management and privatization of “Nauchnaya”. In the end, selling a property complex will not be easy, because its potential buyer will not receive any privileges or guarantees for the use of the company's main asset - land.
Amendments to the Land Code have changed the rules for using land for state-owned enterprises, but in the case of Nauchnaya, this may not work.
What do these changes involve? In the case of transformation of state-owned enterprises into joint-stock companies or LLCs with 100% participation of the state, for example, when they are transferred to the State Property Fund, the areas that were in the use of the state-owned enterprise will be transferred to them only on a lease basis. The lease period will be 50 years, and newly created companies will pay annually at least 12% of the standard monetary valuation of land plots.
If state-owned enterprises cannot fulfill these conditions, their lands will be leased out at land auctions to everyone. According to Shurma’s calculations, thanks to this the state will receive an additional at least 3 billion UAH per year.
Thus, legislators decided to transfer users of state land to market relations. Obviously, Nauchnaya should have followed this path after coming under the control of the State Property Fund, but they found a way to get around this. The fact is that the new changes regarding the permanent use of land do not apply to a certain category of public organizations and they were not slow to take advantage of this loophole.
Thus, the right to permanent use of state land can, among others, be acquired by public organizations of persons with disabilities, as well as their enterprises. This allows them not only to use the land indefinitely, but also to pay only 1% of the normative monetary valuation of the site to local budgets. For comparison: the annual rent of such plots costs about 8% of the valuation.
Shortly before the adoption of the “land” law, a public organization of people with disabilities appeared in the story of “Nauchnaya” - the NGO “Invalids Caritas”, which, through its agricultural enterprise “Harvest of Victory”, decided to obtain the lands of “Nauchnaya”.
This agricultural enterprise appealed to the Nikolaev and Sursko-Litovsk village councils of the Dnepropetrovsk region with a request to transfer to it the plots of the state agricultural company for permanent use. Both village councils refused to “Harvest of Victory”, because the plots are at the disposal of the State GeoCadastre, and local authorities do not have the right to decide on their transfer.
“Urozhay” appealed to the Dnepropetrovsk District Administrative Court with claims to cancel the decisions of the village councils to refuse to transfer plots and the obligation to transfer 14.5 thousand hectares to it for permanent use. Both cases, after automatic distribution, went to the same judge - Roman Golobutovsky.
On October 27, the court stopped both proceedings. It turned out that the village councils in court are trying to reclaim the disputed plots from the State GeoCadastre and terminate the right of permanent use of the Nauchnaya State Enterprise as part of a bankruptcy case. If the village councils are successful, this will give the opportunity to “Harvest of Victory,” which represents the NGO “Invalids Caritas,” to lay claim to these lands.
This public organization was registered in 2019 and has already managed to surface in the courts around Privatbank. It is led by Sergei Doroshenko, who represented interests or worked in structures close to Privat. In particular, in 2013 he was the director of Agricultural Technologies of Ukraine LLC. Doroshenko’s resume indicates that he worked at Privatbank itself before its nationalization.
It was not possible to find detailed information in the public domain about the activities of Caritas Invalides, except for the courts with the already state-owned Privatbank. The EP approached Doroshenko with a question about the work of the NGO, but has not yet received a response.
Associated with the public organization “Harvest of Victory” is its agricultural enterprise. The director of the company “Harvest of Victory” is a public activist and ATO participant Sergei Bukreev. Judging by the signatures on the GetContact service, Bukreev could have been involved in the security of the Priozerny shopping center in the Dnieper. This shopping center was associated with the former owners of Privatbank and its top management.
The head of “Harvest of Victory” Boukreev also declined to comment.
Section 3. How “Privatovites” make money on “Nauchnaya”
The mentioned OOs are not the only companies in the history of Nauchnaya that are associated with Privat. The financial statements of the agricultural company show: for 2022, Nauchnaya received about UAH 140 million in income from the sale of products, but still declares losses. The reporting, in particular, notes that the cost of products sold reaches more than UAH 130 million. This indicates that the agricultural company is not very efficient.
This is not surprising, because Nauchnaya regularly sells “biological assets” at auctions - sown areas where the crop has not yet sprouted. This method of trading is unusual for the agricultural market, where harvested crops are usually bought and sold.
Firstly, such a lot can be significantly cheaper than the final product. In addition, most likely, the price for such a lot is formed based on the volume of sowing expenses, that is, the company does not make money from such sales.
Secondly, the sale of biological assets does not allow us to objectively assess what the starting price should be. Such an assessment, explained the ED at Privatbank, is ordered by the liquidator. Although creditors, that is, primarily Privatbank, approve the price of the lot with their signature, no one will check how true it is.
At the same time, since 2020, Nauchnaya has sharply reduced its staff and has four employees, two of whom are most likely the director and an accountant. How does it sow large areas? The ED addressed this issue to the liquidator of Nauchnaya, Alexander Chikildin. He asked several times to reschedule the conversation, and then stopped picking up the phone.
Many of the mentioned Nauchnoy lots are purchased by Kodatskoe Agro LLC. On August 29, the agricultural company put up for sale 18 lots covering almost 3 thousand hectares. Everything was bought by this LLC, which was the only bidder. The situation is the same at other auctions in 2022-2023.
According to YouControl data, the owner of 94.99% of Kodatskoe Agro LLC through the Agrocenter-Plus company is Invalidov Caritas - the same organization from the orbit of the Privat group, whose subsidiary is trying to obtain the Nauchnaya lands. It seems that the purchase of “biological assets” is a big investment, because, unlike Nauchnaya, Kodatskoe Agro received UAH 10 million in net profit in 2022.
In a commentary to the ED, the director of Kodatsky Agro, Sergei Rozhkovsky, confirmed that the company “for some time provided services to the agricultural firm Nauchnaya for growing grain and other crops on the basis of service agreements,” but refused to specify what areas and what periods of work we are talking about .
He stated that the company does not use Nauchnaya land, and leasing its own agricultural equipment or services is “normal practice.”
Through a parliamentary request, the EP addressed NAAN and Nauchnaya with a request to provide data on the cultivation of Nauchnaya lands by third parties on the basis of agreements, as well as what work is being carried out on these lands. Nauchnaya did not respond to the request of MP from the Servant of the People faction Maryan Zablotsky, and the response provided by NAAN did not contain the requested information.
The resistance that Nauchnaya and its associated companies are putting up in the courts indicates that it will not be possible to quickly destroy the schemes that have been built in these fields for decades. Although this agricultural company is one of the largest in the NAAN structure, besides it there are dozens of others whose lands under similar schemes may not be used by the state.
However, the biggest breeding ground for corrupt deals is the lack of clear data on how much state land remains. While it is transferred to the state land bank, many more areas may disappear unnoticed.
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