Enes
Moscow
WINNER OF THE RF MINSTROY MEDIA COMPETITION 2016
Go to mobile

LATEST NEWS

11:48 27-04-2017
Slovenian investors set to build greenhouses, sports centers in Russia
10:58 27-04-2017
Huge Leroy Merlin store to be built in Russian city of Perm
10:40 27-04-2017
R-Pharm and Fujifilm to set up joint production of dietary supplements
10:19 27-04-2017
Xiaomi intends to open up to 20 new shops in Russian cities
09:53 27-04-2017
Gazprom considers gas production on shelf of Thailand and Cambodia
17:53 26-04-2017
Austrian authorities suspect Airbus CEO of $2-billion fraud
17:36 26-04-2017
Kamchatka’s priority development area to draw over $230m in investment
17:07 26-04-2017
NASA invents inflatable greenhouse for Mars and Moon
16:49 26-04-2017
Russian TVEL to supply fuel to Chinese companies for $1bn
16:29 26-04-2017
USA might start to export coal to Ukraine
16:16 26-04-2017
Gazprom plans to increase gas reserves by 469,9 bcm
16:01 26-04-2017
Construction of Eugal gas pipeline to begin next year
15:45 26-04-2017
Housing in Russia to become more expensive by 10-20%
15:06 26-04-2017
Japan studies Russian proposals to cooperate on Kuril Islands
14:53 26-04-2017
South Africa’s court cancels deal with Russia on NPP building
14:34 26-04-2017
Hungary to take part in Congress Hall construction for BRICS summit
13:41 26-04-2017
New entity for Islamic banking to be set up in Tatarstan
13:15 26-04-2017
Canada pledges to protect its domestic producers
12:57 26-04-2017
Rosnano to sign contract with Finns over wind farms building
11:24 26-04-2017
Russia reaches agreement with Boeing over Sea Launch program
10:33 26-04-2017
Russian escalator market might become world’s largest
09:42 26-04-2017
Chinese develop transport projects in Russian region of Leningrad
17:58 25-04-2017
Sales of new buildings in USA see 6% growth
17:49 25-04-2017
Moscow begins testing of Finnish electric bus of future
17:38 25-04-2017
Russia and Qatar consider joint projects worth $12 billion
17:07 25-04-2017
Why BIM technologies so popular in Finland
16:36 25-04-2017
French Minister pushes for sanctions against LafargeHolcim
16:03 25-04-2017
Russia plans to supply electricity to Ukraine’s breakaway region of Lugansk
15:47 25-04-2017
Chinese to build three metro stations in Moscow
14:33 25-04-2017
Tatarstan reduces cost of road construction, applying BIM technology
All news

ARCHIVE NEWS

«    April 2017    »
MonTueWedThuFriSatSun
 12
3456789
10111213141516
17181920212223
24252627282930

Problem of long-delayed construction solved in the Moscow region: will it be detracted out of court?

logo russianconstruction.com
Problem of long-delayed construction solved in the Moscow region: will it be detracted out of court?

The Moscow region authorities have decided to pursue a policy of nationalization. And are going to start with long-delayed construction.

The Moscow region Government announced an unexpected initiative having suggested detracting problematic long-delayed construction on an extrajudicial basis. Moscow region Governor Andrei Vorobiev has sent corresponding federal legislation amendments to the RF Minister of Construction, Housing and Utilities, Mikhail Menn.

 

Have the floor, comrade Mauser! 

Elderly people, like me, may remember a scene seen in plays and films: an official in a leather coat and a mauser in a wooden holster comes to a construction site, calls directors and announces the decision on confiscation of what has been built. Workers and engineers quit the site accompanied by cops, and the gates are locked. Later new owners appear on the construction site.

 

Law for illegality?

You would say, it is exaggeration, such things are impossible at present. May be. And the Moscow region authorities are not going to act unlawfully. More than that, they are going to supply their actions with a legal basis.     

In particular, as the press office of Deputy Chair of the Moscow regional government, German Elianushkin, reports, the 214-FL and the RF Land Code are supposed to be amended with the compulsory introduction of extrajudicial enforcement of pledge in the construction co-funding contract (CCC), and the procedure of such pledge.

It should be conducted in favour of co-funders by the regional authorised body under any CCC participant’s application. The pledged item enters the common share ownership of co-funders or is for sale by contract.

The received money is paid to CCC participants.

Problem of long-delayed construction solved in the Moscow region: will it be detracted out of court?

On the fence: Happiness is close 

Means against noise

It is not difficult to understand the Moscow region officials: the problem of hoodwinked investors in the region is very acute. In 18 municipalities there are 34 long-delayed constructions and 6256 hoodwinked investors.  The developers of the 18 problem objects have gone bankrupt, heads of 6 companies are taken to court on criminal charges, two of them are wanted.   

It is clear that application to court for hammering these companies takes time, and angry people hold mass-meetings at administrative buildings/ Of course, it is easier to introduce a mechanism allowing to repossess such objects, to sell them at auctions or to sign away for other developers to complete the construction.

 

Cause for harakiri

But is it better to do as it is easier? Actually, if the Moscow region authorities’ proposals are adopted, construction companies will be deprived of court protection. But they need it as much as co-investors do.   For example, a developer borrows a credit at a big rate, and then he is deprived of hos property thus losing the opportunity to pay back to the bank via restructuring the business or his debt.

Similar practice opens way for corruption, as it depends on a person to declare an object to be a long-delayed construction. Besides, cheats may use the situation: collecting money, starting an object construction and the stopping it for some good reason. And the wait until the objects is determined as long-delayed. 

Developers may become less responsible as they need not care about obligations discharge.

 

Not to allow

Any extralegal structure, even if it is legalized triggers free-for-all attitude to the process. Victor Pryadein, Head of NOSTROY administration, thinks that just the contrary things should be done.

According to him, when the 214-FL was significantly amended, the emphasis was laid on the government control tightening, all necessary procedures were determined in the law. There is a coverage mechanism – an indemnification fund, construction companies’ project declarations are checked more thoroughly  All these measures are directed not at confiscation of long-delayed constructions but at their avoidance.

Another important thing is to explain to potential buyers that they should not take part in various shady schemes.

 

Falling into the same trap

And what is business’s attitude towards the initiative of the Moscow region authorities? Different representatives have different viewpoints. But even if business partially supports the initiative, they voice concerns on probable consequences of such measures.

From our standpoint, such experiments are inadmissible and risky. There is a real danger that the initiatives like that will overturn the so long worked for legal structure in housing construction, where much new and useful has been done lately.

Officials may make their life easier but the final result may turn just the opposite to the one the authorities hope for: There won’t be any long delayed constructions, as there won’t be any construction at all. For who would like to take such risks?

Vladimir GURVICH

 

Related publications

PARTNERS

UP