No more word-of-mouth contracts? The Chambers of Agriculture warn against paralysis in the countryside

The draft act on agricultural leasing in its current form raises numerous doubts because it formalizes the conclusion of contracts, which will primarily affect small farmers for whom long-term neighborly relations are based on trust – said the National Council of Agricultural Chambers (KRiR).

At the end of December, the draft act on agricultural leasing, prepared by the Ministry of Agriculture, was published on the website of the Government Legislation Center and submitted for public consultation. The planned date of adoption of the project by the Council of Ministers is the first quarter of 2026, and the planned entry into force of the new regulations is to take place 3 months after the publication of the act.

The end of the “face deal”. 75 percent arrangements are oral

The proposed act is intended to comprehensively regulate the lease of agricultural properties and farms. The project establishes the rules for concluding and terminating agricultural lease agreements, paying rent, and regulates the rights and obligations of the parties to the agricultural lease agreement.

It assumes, among other things, that agricultural land lease agreements are to be concluded in writing, with confirmation of their conclusion by a notary, the head of the ARiMR district office or the commune head.

Bureaucracy will push farmers into the gray zone

The KRIR Management Board submitted comments on the project to the Ministry of Agriculture. “The agricultural local government believes that the project in its current form raises numerous doubtsbecause the introduction of a high degree of formalization and rigid solutions may prove impossible in practice (e.g. in cases of unconducted inheritance proceedings or when the property has many owners), which may consequently threaten the continuity of production, especially in smaller family farms,” ​​we read in the letter.

Currently, there are contracts concluded orally and in writing. According to the Ministry of Agriculture and Rural Development, 75 percent agricultural lease agreements are concluded orally.

The key reservation is the scope of the act – we believe that it should apply only to undeveloped agricultural land, because the current regulations of the Civil Code regarding the lease of buildings are sufficient, and their inclusion in the new draft would require the introduction of a number of additional, complicated regulations – indicate the Chambers.

According to KRIR, introducing the obligation to conclude contracts only in written or electronic form is a formalization that means an increase in costs and administrative burdens, which may be a barrier for older farmers, resulting in giving up the use of land and expanding the “gray zone”.

The Chambers point out that the project should take into account the situation of the lessor's death, enabling his successor to assume the rights and obligations of the deceased, which will prevent the sudden expiration of contracts.

Game for subsidies and 10 years for changes

“Due to the huge scale of contracts currently concluded orally and the complicated legal situation of many lands, we propose the introduction of a 10-year transitional period to adapt existing lease relations to the new requirements. A shorter period will result in the exclusion of thousands of farmers from the subsidy system and the mass loss of land from agricultural production,” wrote the letter to the Ministry of Agriculture and Rural Development. (PAP)

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