Government has made open auctions mandatory for the sale of leased state and municipal property

The Government has amended the rules for small-scale privatization and made open online auctions mandatory for the sale of leased state and municipal property. This was announced by Ukrainian Prime Minister Yulia Svyrydenko.

From now on, leased state and municipal property that has undergone renovation or modernization shall be sold exclusively through open online auctions on Prozorro.Sales.

According to the Head of Government, a non-competitive buyout mechanism was previously often used: property was leased, funds were invested in repairs or modernization (so-called non-removable improvements), after which the lessee received the right to buy out the property without an auction and at a significantly lower price.

“Because of this, communities and the state were losing out on funds,” emphasized Yulia Svyrydenko.

According to estimates by Transparency International Ukraine, on average, this resulted in 45% less revenue than through open auctions. 

The Prime Minister also noted that in 2021–2024 alone, open auctions generated over UAH 3 billion in revenue—more than twice as much as buyouts.

“Now, prices will be determined by competition and the market. At the same time, we are maintaining protections for bona fide businesses: confirmed investments by the tenant in essential improvements will be compensated or credited during the final settlement,” noted the Prime Minister of Ukraine.