INTERVENTION ON LAND MARKET IN POLAND

PhD Adam Sadowski

Faculty of Economic

University of Bialystok

Poland

Undertaking the intervention in agriculture is connected with the will of active state’s action on

social-industrial processes in the country.

In Poland, in the first period of transformation, state didn’t get the intervention. Land market was completely liberalized. The owner of lands could become each Polish citizen. There was not any limitations of area of buying lands, or buying

person (with the exception of foreigner).

This leads to many disadvantageous occurrences:

excessive concentration of land

crumbling of parcels

the speculation on land market

leading farms by persons without qualifications

In order to oppose these negative occurrences, and also in the connection with necessity of adjusting

the norms into EU law, the Government undertake intervention

The institution, which leads the intervention on land market is Agricultural Property Agency (APA).

In connection with integration processes from 16 July 2003 the new norms were introduce. They

make possible to intervene on land market in the direction of supporting family farms and to oppose

land concentration.

In order to this, two new instruments could be used:

the pre-emption rights (in the case of selling contracts)

the law of buying out - repurchase (in the case of the other contracts transferring properties for example: donation, bringing possessions to the company)

This kind of activity become fundamental novum in Polish agricultural politics but in EU

that kind of activity function from the end of the 60’s XX century

In UE countrys the state’s intervention on land market is directed into:

opposing to concentration

opposing division of farms

controlling persons leading farms

Among instruments which are using to these some can be mentioned:

the law of pre-emption right

state’s repurchasing

neighbor’s pre-emption rights

the administration’s control of buying land

limitation of land divisions

In Polish agricultural policy a family farm was creating as a central point, and the total area of

arable land is not over 300 ha

An individual farmer in Poland, is a physical person who: owns or leases agricultural

properties, brings in by himself, has agricultural qualifications, lives in the place where he has

properties and land.

The Agency will be able to realize the pre-emption rights in situations when one of above

criteria is not fulfilled.

The legislator provides some exceptions from using these norms and so the law of pre-emption rights can be executed if:

the transfer of agricultural properties results on enlarging the family farm (to 300 ha),

turnover is made within the family,

the property is bought by a leaser (a 3-year leasing is obligatory)

In agreement with law, the Agency, should be informed by sellers or notaries and it has one

month for examination the case

The norms are realized scrupulously and from 16

July 2003 to the end of June 2005 to the Agency’s examination came in about 149 thousand of

contracts, which refer 232 thousand ha of lands. The Agency examine about 75 thousand of

contracts per year and controls about 60% of transactions.

Average contract was about 1,56 ha, and it means that the Agency refers mainly small and very

small plots.

Fulfilling the norms the Agency undertook actions in small number of cases. In 2003 the Agency gave 15 declarations for the total area of 554 ha, and the cost of these activities was about 1 mln zl (250 thousand Euro).In 2004 the number of declarations was 69 and they referred 1469 ha. The cost of intervention activities in this year was 9,4 mln zl (2,35 mln Euro).In 2005 to the end of June the Agency gave 63 declarations to 1936 ha, and the valuation cost of these activities was established on 3,7 mln zl (925 thousand Euro)

Together from the beginning of the realization of this law (16 July 2003) to the end of June 2005 the

Agency gave 147 declarations (139 pre-emption and 8 repurchases) , which referred to over 4

thousand ha grounds.

The Agency’s activities still do not have a mass character and it is difficult to say at that moment

about the efficiency of this tool in land market

Lands which were taken by the Agency are usually distributed in the way of selling or leasing, on

limited auctions addressed to individual farmers

Conclusions

It should be positively estimated the fact of passing the norm of shaping agricultural system

because liberal approach to the problem of turnover of agricultural properties did not

favour rationalization of agricultural structure leading to its polarization

It can be expected that the scale of the Agency’s influence on land market would be larger and larger

The Agency’s actions on the field of land market regulation are necessary to brake the speculation

Thank You