Often, property verification is perceived as a formality: businesses limit themselves to obtaining an extract from the register and believe this is sufficient. However, the consequences can be dramatic: litigation ⚖️, seizures 🚫, loss of ownership rights, or suspension of investment projects.
In the article “Protection of Property and Land Issues in Business”, prepared by Juris Ferrum Law Firm partners — Nadiia Gnizdovska and Ganna Gnizdovska — specifically for Yurydychna Gazeta (Legal Newspaper), we explain:
- how to mitigate risks;
- why legal security is a long-term strategy rather than a one-time action;
- which steps businesses should take today.
🔻 Legal Purity of Real Estate
Commercial premises are not just walls and a roof, but primarily an asset that determines the company’s market value. Investors, banks, and partners assess not only the size or location, but also the legal history of the property. If documents contain errors or inconsistencies, the business risks losing both money and trust.
🔻 Due Diligence
Property verification is not a recommendation but a critical stage of any transaction. An extract from the State Register of Property Rights is not enough. One must review BTI archives, local archives, and court decisions. Such an audit reveals hidden risks: old debts, prior seizures, illegal reconstructions, or ownership disputes.
🔻 Loss of BTI Archives
Due to the hostilities of 2022–2024, a significant part of the archives was lost or damaged. This complicates confirmation of rights to old buildings or those that underwent reconstruction. For businesses, it means additional time and resource expenditures to restore documents or applying to court for recognition of ownership.
🔻 Litigation
Verification of court registers allows one to uncover issues not always reflected in state databases. An owner may be a party to a case on contract invalidation; the property itself may be the subject of a dispute on unauthorized construction; and the land beneath it may be the object of judicial proceedings involving local self-government bodies.
🔻 Post-Acquisition Control
Registering ownership rights is only the first step. A system of protection must follow: monitoring changes in the State Register of Property Rights (“SMS-majak” 📲 service), placing a ban on registration actions without the owner’s participation, or executing easements and mortgages in favor of the business. For large companies, asset structuring through separate legal entities or holding models remains relevant, making hostile takeovers more difficult.
🔻 Land Relations
Land is the foundation for any real estate. If its legal status is unsettled, the entire investment is at risk. Lease agreements must be duly registered, and conditions of emphyteusis or superficies must be clearly defined. Misuse of land or contractual errors may result in the building being recognized as unauthorized construction and even an order for demolition.
We believe that the protection of property and land is not a one-time action, but a long-term strategy. A business that invests in the legal security of its assets protects not only its property, but also its stability, reputation, and investment attractiveness.
📖 Read the full version of the article on the Yurydychna Gazeta portal.