Adopted initiatives of Ministry of Construction: what changes awaits developers?


In July, President of Russia Vladimir Putin has signed a number of laws, initiated by the Ministry of Construction. Mikhail Men told reporters about some significant changes in construction industry of the Russian Federation which result from these initiatives.

Caring about equity holders

Amendments to the Federal Law# 214 on shared equity construction of multi-apartment buildings with the involvement of citizen’s funds were adopted. They will enter into force on January 1, 2017.

The amendments provide information transparency of developers, introduce additional requirements and increase control over the use of funds, as well as extend authority of state regulatory agencies.

Non-mandatory opening escrow accounts for payments under contracts of shared construction and revocation of compulsory insurance are considered to be definite advantages for developers. “The law on insurance will be revoked in the autumn session,”- explained Mikhail Men.

Liability system

After the adoption of amendments to the law, compulsory membership in SRO (Self-Regulatory Organizations) is established only for general contractors, other companies are discharged from it.

“Persons performing construction contracts for the amount of up to three million rubles are now not obliged to be members of SRO,” said the Minister.

The law also aims to create a system of single responsibility to a customer: general contractor will take full responsibility. Compensation fund for contractual obligations to ensure SRO financial responsibility for nonperformance or improper performance by its members will be established.

According to the minister, technical specialists – chief engineers and chief inspectors is now personally responsible for works during design and construction of facilities. In addition, a national register of such persons is created.

Sample architects

Mikhail Men also mentioned the adoption of a law on the repeated use of design documentation for state contracts.

Earlier, the Union of Architects of Russia noted that “the bill of the Ministry of Construction proposes to deprive the rights of architects on the subject of intellectual property, to delete architecture from the list of works protected by copyright.” The press service of the Ministry of Construction pointed out that this information does not correspond to reality.

Under the new law, the customer has the right to re-use project documentation, paid from the budget of any level and developed on the basis of a piece of architecture, urban planning or landscape art, without the consent of the author. This reuse of the project does not deprive architects of copyright to their works.

Effective industrial zones

The materials of the Ministry of Construction are also referred to the adoption of a law aimed at improving preparation, coordination and approval of urban planning documentation for areas meant to integrated development.

Before January 1, 2017, municipalities should bring land use and development rules (PZZ) into line with this document.

“According to experts, this will allow to engage up to 20-25% of the city area in economic turnover building there new homes, objects of social and transport infrastructure. In particular, it will help to engage inefficiently used industrial areas in the process of comprehensive redevelopment in large cities,” noted representatives of the Ministry.

Social residential lease

The Minister also touched on the current issue of social residential lease. The legal framework for the mass construction of rental housing in Russia is almost ready, told reporters the Head of the Ministry of Construction.

The Minister noted that about 1 million square meters of rental housing is already built.

“But we do not yet understand how the market will work due to mentality of our citizens,” said Mikhail Men.

He added that the Housing Mortgage Finance Agency prepares pilot projects which will show the attitude of people to the idea of mass construction of rental housing in Russia.

Dilapidated housing

A new law on resettlement of dilapidated housing will be reviewed by the State Duma only on the autumn session, reported Mikhail Men.

“The new law on resettlement of dilapidated housing will be discussed on the autumn session of the new parliament, though we have already made serious developments on this issue,” said Mikhail Men.

According to him, the detailed study of the law will be done by the new parliament. “By September 2017 we ought to rehouse dilapidated housing which was acknowledged as unhabitable before  September 1, 2012,”recalled the Minister.