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Natalia Dotsenko-Belous on Forward Contracts in Construction
Vasil Kisil & Partners,
Kyiv, Ukraine, March 25, 2013
On March 20, 2013, the Ukrinform news agency hosted a round table "On forward contracts in construction: regulator's perspective and the experience of ‘Perspektiva Commodity’ commodity exchange”. The event was attended by representatives of the National Commission on Securities and Stock Market, officials of the Ministry of Incomes and Fees of Ukraine, the Ministry of Economic Development of Ukraine, self-regulatory organizations and stock market professionals (asset management companies). Counsellor with VKP's Real Estate & Construction practice Natalia Dotsenko-Belous represented the firm at this event.
«Forward contracts executed through the sale and purchase agreement of the ownership rights are ideal for the new registration system and allow us to adapt the mechanism used by building owners to the affordable housing program”, - emphasised Mrs Dotsenko-Belous.
She also reminded that forward contracts have been used in Ukraine since 2000 in other areas of the economy, such as agriculture, and since 2010-2011 they are used extensively in the field of energy and gas, and are actively traded on “Perspektiva Commodity” commodity exchange.
According to experts the key criterion for choosing a forward contract as a sales tool for the future real estate is to ensure maximum guarantees for the buyer. Investors shall have the exclusive and preferential right to purchase an apartment under the contract of sale of property rights, which eliminates the risk of double sales, and neutralizes the risks associated with other use of foreclosures (as, for example, it is often the case with housing bonds when there is a parallel mortgage on the property being sold).