Prepared for the South Caucasus Regional Land Policy Conference
Tbilisi, February 24-26, 2003
© Communities Finance
Officers Association (CFOA)
2003
Yerevan
This paper was prepared for the South Caucasus Regional Land Policy Conference by the Communities Finance Officers Association (CFOA). The Conference was organized by the Association for Protection of Landowners’ Rights (APLR) in cooperation with Agro-Meslehet of Azerbaijan, and the Communities Finance Officers Association of Armenia.
Major funding for the Conference has been provided by the
United States Agency for International Development (USAID) through the Eurasia
Foundation's South Caucasus Cooperation Program. Additional support for the Conference has
come from FAO, International Land Coalition, UNDP, World Bank, and British
Petroleum. However, the views and
opinions expressed in this paper do not necessarily represent those of the
Foundation and the United States Agency for International Development, or of
the other co-sponsors of the Conference.
LAND POLICY IN THE REPUBLIC OF ARMENIA
1.General Information about the Country and National
Land Fund
The Republic of Armenia is situated in the south-west of
Asia. It occupies the northeastern part
of Armenian plateau. The total area of Armenia is 29.743.000 km2.
1391.400 hectares – 46.8 % of the land has agricultural significance of which:
arable land – 494.300 hectares
Perennial crops – 63.800 hectares
Hayfields – 138.900 hectares
Parture - 694.400 hectares
Of which state property:
a) Within the administrative boundaries of the communities - 519.400 hectares.
b) Outside the administrative boundaries of communities 323.750 hectares.
Forests and shrubs – 423.200 hectares – 14.2 %,
Water – 165.200 - 5.6 %,
Other lands – 994.500 hectares – 33.4 %,
Private property 467.100 hectares including personal plot – 70.600 hectares.
Armenia is considered as a predominantly mountainous country among the South-Caucasus countries and is notable for its hard relief and variety of national condition. The average height of the territory of the Republic is 1800 meters above sea level. 90 % of the territory is at an altitude of more than 1000 meters above sea level. According to the territorial administrative structure the country is divided into 11 marzes – 10 marzes and Yerevan, which is also granted marz status. Marzes are divided into communities. The population in 1.01.2001 numbered 3802.400 people of which urban population numbered 2532.400 people, rural – 1270.000. More than half of the population lives in Ararat region where the average density of population is 133 people in 1 km2.
Rural economy: taking into consideration natural, economic conditions and production specialization 9 agricultural zones are marked out in the territory of the Republic.
Per capita GDR is $706.3 in 2001,
Industrial production 339.8 billion drams,
Agricultural production 351.0 billion drams.
The land reform in the Republic of Armenia started in February 1991 with the adoption of the Land Code and the Law on Peasant and Peasant Collective Household. The privatization was carried out in three stages. The first step of the land reform was the privatization of agricultural land except pastures. Communities, regional privatization commissions were founded which the central republican privatization commission governed. Privatization started in February 1991 and finished in April 1993. According to the law 20 % of the total area of arable land except pastures were left in the reserve, the rest was privatized. The size of land units to be distributed was calculated by dividing the total area of irrigated arable land, non-irrigated arable land, allotments and mown grassland by the number of individuals living in a village.
A family of three people received one unit; a family of up to six people received two units, while the families with more than six members received three units of land.
In the first stage land parcels received inhabitants, who were registered and lived in the settlement before 20.01.1990. In the second stage land parcels received former inhabitants of the settlement who expressed a wish to COM back.
In the third stage land parcels received those citizens of the Republic who expressed a wish to be a permanent resident in the given settlement.
As a result of the reform 467.1000 hectares were prevaricated –more than a million agricultural parcels. Of which:
Arable land – 303.700 hectares,
Perennial crops – 15.400 hectares,
Vineyards – 16.500 hectares,
Personal plots – 70.600 hectares,
Other land – 300 hectares.
As a result of the privatization of the land 332608 peasants and peasants collective farms were created. Not only the arable land but also cattle and sheep herds, and agricultural equipments were privatized.
According to the new Land Code adopted in 2.05.01 by the National Assembly of Armenia is planned to privatize land by auctioning state land and transfer, it to the needy population free of charge. However, not all-rural land was privatized. In each community 25 per cent of each category of land has been kept as state property.
The following state land can’t be privatized:
Armenia was the first country among the countries of CIS, which started the privatization of land after the proclamation of independence.
In 1991 the Supreme Soviet of the Republic adopted 3 important laws. They are Law on Property, Law on Peasants and Peasants Collective Farms and Land Code, which laid down the foundation of market reform. As a result 300000 landowners appeared.
Housing resources, units of industry and other branches of economy were privatized in the Republic, too. Now there are more than 2.5 million parcels, including individual properties and privatized apartments and agricultural plots.
The Constitution of Armenia, adopted in 1995, recognizes and protects the right to ownership of Land and other real property. The new Civil Code of Armenia, 1999 abolishes outdated rules governing private commerce and property, encourages free-market activities and guarantees individual property rights. It regulates relationship to land and contains provisions on ownership, use, preservation of and control owner the land. It promotes the securing of conditions for free development at all forms and ownership for all subjects of ownership on the basis of multiple forms of economic activities as well as ensuring legality in land relations. The Land Code was adopted in May 2001. It provides for the change of land plot boundaries, consolidation and subdivision. It mentions the responsibilities of state bodies and local-self government bodies, the new principles of land plots classification, the organization of auctioning of community and state land, the objective of rational use and protection of land, the rights of landowners. After the adoption of the Land Code some amendments were made. The Law on Mapping and the Law on Geographical Names were adopted.
4. Institutional Reform to
Maintain Land Reform
On June 30, 1997 was established the unified state real property cadastre to record and appraise property objectively and effectively and establish a tax policy on real property.
On August 28, 1999 by the Government Decision was established State Real Property Cadastre Committee. The State Cadastre Committee (SCC) is the main agency operating in the central level and responsible for land administration. The SCC is authorized to implement and conduct the real property unified cadastre. The Committee operates through 47 Local offices.
Later was adopted the Law on the State Registration of Rights to Property (April 14, 1999). The objects go State registration is property rights, use rights, pledges, mortgages and easements. The subjects of State registration are the State, communities, citizens, and legal entities.
It is important to mention that according to the Law the main objectives of the State registration are as follows:
a) Recognition, guarantee and protection of the right to property by the State,
b) Support to the real estate market,
c) Creation of an information system of rights and restrictions on property,
d) Provision of continuity, objectivity of data about the real property and right, and restrictions on property.
The financial policy of the state Cadastre Committee subordinate to the Government of RA based on self-funding. The costs of the maintenance of the central apparatus of the Committee and its activity aren’t covered by the state budget. According to Article 49 the financing is done from received current activity sources.
5.
The level of Land Fragmentation and the Strategy of Land Consolidation
The level of fragmentation in the Republic is very high. The privatization process had resulted in a large number of very small and fragmented farms. There are more than 1 million land parcels in the country. In order to avoid further fragmentation, according to the new Land Code division of arable land is not allowed when the land is taken by inheritance.
The average farm size is only 1.2 hectares with every farm having four or five parcels in different locations, of which one parcel is irrigated and others are not.
Subordinate to the Committee is the Use Planning Institute (Giprozem), which is now a joint-stock company totally owned by the SCC. SCC and Giprozem Institute has developed pilot project for 8 communities of Ararat, Armavir and Kotayk marzes.
The main principles of the project are:
· Voluntary participation of owners,
· Implementation of the program only in those communities, where the rights to property are registered and have cadastral maps,
· Active participation of all inhabitants of the community as owners and land users in the process of working out and realization of the project,
· Appraisal of land, included in the program, not according to its physical size but market prices,
· Openness and transparency in all actions and process of decision making,
· Working out the project of land consolidation,
· Alternative variants of land consolidation - selling and buying, exchange, cooperation, creation of joint stock, renting.
Pilot project plan work out normative-legal acts, which will create favorable conditions for the solution of the problem.
6.
Public Participation in Decision Making Process and Public information
Civil and Land Code of the Republic of Armenia guarantee equal rights to all the subjects of property - the State, communities, citizens and legal entities. The legal bases created in the Land Code guarantee participation of citizens in decision making during the land use planning and also a free access and transparency to the process of selling and leasing of state land by participating in public auctions.
The process of registration of rights to property is also open, especially during the initial registration, which is done at the expense of the Government, when all owners are informed about the registration in advance including all parameters of real property and the owner can dispute these parameters before hand.
7.
Development of Land Market
Though land reform started at the beginning of the 90s the
real market of land and real property was formed later. After the adoption of the Land Code in 2001,
a normative base for the development of land and real property market is
actively formed. The Government of the Republic of Armenia gave its approval to
the real property market development program designed for the 2002-2009 years
period. The strategic goal of the program is to develop a competitive
environment in the real property market and in the system of the civic turnover
with the real property and rights towards them, as well as creation of
necessary conditions for the best and maximum efficient usage of real property.
On 1st of October
2002, approximately 70 juridical and 70 physical bodies are licensed and
continue their activities. Almost the half of them is occupied with the
evaluative activity. In the recent 3
years 5 associations were formed in Yerevan, which brought together about 35-40
organizations occupied with realtor and evaluative activities. The unification
gave an opportunity to unify efforts, professional skills and means for the
solution of common problems, as well as to acquire hardware and another
up-to-date technology, open own web sites, thus raising the level and speed of
information flow for the real property market participants.
Today the real property and
land market has a rising tendency, the prices of lands are stabilized, but
prices flats and private houses continue to rise.
8.
Donors and international Cooperation
The Armenian State Cadastre system is based on the main leading principles of MOLA ECE UN. In November 1999 this organization was reformed into the Working Party on Land Administration (WPLA). 55 countries are members of this organization and Armenia is one of them. The mission of the expert team of this organization visited Armenia in November 2000, for studding the system of Real Property Cadastre and representing ECE UN the official opinion. Autumn conference of WPLA took place in Yerevan (for the first time among the CIS countries). In the second Yerevan conference of ECE UN Session for its high organization level and achieved results the Armenian Cadastral System received a high appraisal. According to the mission’s official conclusion review and results of Yerevan Conference Armenian Cadastre system was accepted as a model one and was recommended to European Countries for studding and application of the methods. The Committee is also a member of the International Association supporting to the market of geoinformation technology and services. From 2002 the Committee is an official member of Euro graphics Association and from 2003 Armenia is planning to join the European Reference Frame (EUREF). The work of the “First Title Registration” and especially cadastral mapping in Armenia have been realized within framework of the programmed financed by deferent international organizations.
The following cadastral programmes are realized in the system of Cadastre:
The program is financed at the expense of loans of World Bank and state budget means.
EU Food
security programme
Support land surveying, registration and the issue of title certificates for agricultural land. Within the framework of the programme the State budget received loans for the realization of state registration from 1998 till 2002.
The Programme of Land Registration and Concession of Right to Property - The
United States Agency for International Development (USAID).
The United States Agency for International Development together with the State Cadastre Committee realized the program of the first title registration from 1998 till 2001. Within the framework of the systems were realized “Real Property Registration” and “Cadastral Mapping” systems. The programme was over in June 2001.
The Programme “Development of the system of Cadastre in
Armenia” of the Swedish International Development Cooperation Agency” (SIDA)
In August 1999 the Committee signed the treaty with the SIDA and Swidsurvey according to which Swidsurvey is realizing the programme “The Development of Cadastre System in Armenia” of the expenses of the SIDA grant. The project concentrates mainly on technology support and strengthening of the geodetic network, land consolidation, real property market appraising, and 2-3 specialists from the system of Cadastre are trained in Sweden every year. At present, there are discussions about the extension of the programme for 3 years.
The Programme of Financial and Technical Cooperation of
Swiss agency on Development and Cooperation
According to the treaty signed in October 2001 between the government of Armenia and Switzerland the Committee together with the Federal Office of Topography of Switzerland has been realizing “The Programme of Financing and Technical Cooperation”.
9. The Main Achieved Results in the Process of Land
reform
The main results of the first and second stages of land reform are:
· The establishment of citizens, legal entities and local self-government bodies' institute of property,
· Functioning of real property market,
· Mortgage crediting,
· Formation of the legislative base for the provision of transparent alienation of state land by the introduction of the institute of public auction,
· Increasing of the role of local self-government bodies in the sphere of land recourses management,
· Guarantee and protection of property rights of all subjects of ownership.
The new Land Code gives the opportunity to privatize land of public and industrial setting there by previously privatized enterprises will be more attractive from the point of view of investment. During the last 2 years as a result of alienation of state land 2.5 billion dram enter to the State budget.
Land consolidation is an effective means to improve agricultural production and working conditions as well as to promote the general use and development of land in rural areas. The transference of state land to the communities on the right to property has rather increased the role of local self-government in the sphere of land resources administration and will be an additional source of increasing local budget.
10.
Perspectives
For successful continuation of land reform, it is important to take the following steps:
1. Foresee land reform in the whole context of economic reform.
2. Improve legislative base of land resources management.
3. Continue separation of authorities` (central and local) functions from the ones of private sector.
4. Give methodological and practical help to the Local self-government bodies in the sphere of land policy.
5. Provide the transparency of activity of all bodies of authority; involve the society in the process of program discussion and decision-making.
6. Create operating centers of training and on-the-job training for employees.