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Real Estate, Land & Construction practice of VEGAS LEX chaired by the partner and the head of the practice, Igor Chumachenko, has successfully implemented an extremely interesting and complicated project on judicial recognition of rights to an artificially created land plot (Artificial Land) in favor of one of large businesses that owns a cargo terminal with lots of permanent structures in the territory of Novorossiysk Sea Port.

This is a complicated and quite a unique project, because a legal predecessor of the company built the industrial facility that actually represents an artificial land plot as far back as in the '60s and '70s, i.e. long before the Law Concerning Artificial Lands came into force (passed in 2011).    

Meanwhile, current legislation has a loophole concerning possibility to legalize/register title to previously formed structures, which today meet all the criteria for Artificial Lands established by law. This situation, indeed, affects disposal of the rights of owners of such structures, since it deprives them of the opportunity to legally build permanent industrial- and other-purpose facilities on such Artificial Lands. With that said, according to the Law Concerning Artificial Lands, the peculiar feature of such real estate is that it combines functions of both a facility and a land plot (after its commissioning and startup).

At the first stage, VEGAS LEX elaborated a strategy for legalization of rights to the existing facility as an Artificial Land. We determined necessary pretrial actions, the legal remedy, defendants and third parties, the necessity for pretrial and judicial examinations, possibility to use historical sources as certain     substitutes for documents required by the Law Concerning Artificial Lands and the Law on registration, and jurisdiction. The experts developed a legal strategy in terms of removal of the registered federal land plot within the borders of the Artificial Land from the official register and solved many other critical issues.

At a later stage, this strategy was applied within judicial proceedings. The principal state expert agency – the Centre for judicial examinations of the Ministry of Justice of the Russian Federation – conducted a comprehensive judicial expert examination. The examination proved that the facility is a structure created on a waterbody by means of soil filling and through building bank-protection structures and it possesses all the features of Artificial Lands established by law.

As a result, a court ruling came into effect. The ruling is off precedent-setting nature since it may give a chance to implement such projects to owners of facilities, which meet criteria for Artificial Lands, but which are not officially registered as such. Alexander Sitnikov, Managing partner of VEGAS LEX, took part in implementing this complex project. Special thanks are due to our colleagues from Southern directorate chaired by the head and the partner of the firm, Maxim Grigoryev.

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