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Farm rules may be amended

Parliament to debate limits on foreigners owning farmland

By František Bouc
Staff Writer, The Prague Post
February 28th, 2007 issue

Foreigners from the European Union should have easier access to farmland in the Czech Republic, quite possibly at the expense of the Czech farmer.

Prime Minister Mirek Topolánek’s Cabinet submitted an amendment to the Foreign Exchange Act Feb. 21, as well as an amendment to the law on land transfers, which would only require EU foreigners to register as farmers in order to buy farmland in the country.
Until now, the Czech Republic has protected farmers from foreign buyers by forcing anyone wishing to purchase farmland to reside in the country for at least three years and speak Czech fluently.
Topolánek said the Czech Republic has to change the law to fall in line with EU regulations.
“The current provisions go against usual law in the EU, so they are not sustainable,” he said.
This could have major implications for Czech farmers. Unlike other EU countries — in which only 30 percent to 40 percent of farmers lease their land — Czech farmers lease roughly 90 percent, Agrarian Chamber (AK) President Jan Veleba said. If landowners decide to sell farmland to foreign agricultural companies, there would be little local growers could do about it.
In 2004, the Czech Republic negotiated a seven-year transition period during which it could protect its farmland from foreign investors. But Czech laws about foreigners’ rights are set to expire in April. As a result, Topolánek’s Cabinet had to decide whether to prolong the provision or cancel it.
Agriculture Minister Petr Gandalovič lobbied to continue protecting farmland.
“It is in the country’s national interest to protect our farmers,” Gandalovič insisted.
Veleba said the Cabinet’s move is premature, partly because Czech farmers have not yet had enough time to earn the money needed to buy their land.
“Our farmers are not yet ready to compete with financially stronger foreign farmers,” Veleba warned.
Last year, gross agricultural output fell to an all-time low of 66 billion Kč ($3.1 billion), the Farmers’ Association has announced. Meanwhile, farms in the Czech Republic generated a profit of 7 billion Kč, down 8 percent against 2005, according to preliminary estimates released by the Czech Statistical Office Feb. 23.
Farmers have been posting a profit since EU accession, but the profit is gradually falling in spite of increased subsidies from the state and the EU.
The amendments to the Foreign Exchange Act will be devated in Parliament this spring, and Veleba said the AK plans to lobby against it in the Chamber of Deputies. If it passes, the new law would come into force next fall, Agriculture Ministry spokeswoman Táňa Králová said.

František Bouc can be reached at fbouc@praguepost.com


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