Finland Seeks Explanation of Russian Land Sales Ban

Foreign Minister Alexander Stubb

Finland will ask Russia for an explanation of a new ban on property sales to foreigners covering wide swaths of north-western Russia. On Tuesday Russian officials published a list of areas where sales of land to foreigners or foreign companies is forbidden.

The list includes most of the areas across Finland’s eastern border, a total of 34 cities and districts. There are a few exceptions such as the town of Priozersk, which was the Finnish town of Käkisalmi until the Second World War.

According to the Russian Embassy in Helsinki, the list is related to a law dating back to 2001 that blocked foreign ownership along the border zone. That zone has now been defined by presidential decree.

Embassy officials declined to explain to YLE the aim of the law or why the areas are so extensive.

Tuesday’s announcement is bad news for Finns planning to buy land across the border – or who have done so over the past decade.

Old Deals to be Cancelled?

The Finnish Foreign Ministry will ask for an explanation of the move.

“We stick to the principle of reciprocity as long as it is realistic and possible,” says Foreign Minister Alexander Stubb. “We’ll talk with Russian authorities about how this can be realised. If one can buy land here, then of course one should be able to buy land on the other side of the border as well.”

Stubb believes that the ruling is related to Russia’s internal politics. He compares it to the situation in Finland around the time it joined the EU in 1995. At that point, many Finns wanted to limit sales to foreigners.

The ministry will also look into the fate of land deals that have already been carried out. According to the Finnish Karelian League, Finns have bought several dozen properties in the area since 2001.

Leena Lehtinen, a Tampere lawyer who has served as a consultant on deals in Russia for decades, believes that any land purchases made in these areas since then will be annulled and that the buyers will not be able to get their money back.

Up until the recession, many Russians were buying properties in eastern Finnish cities such as Lappeenranta. There, real estate agent Auli Virtanen says that such sales have dried up. Instead many Russians are trying to sell properties they bought at high prices before the slump.

“But they’re not able to recover the price that they originally paid for them,” says Virtanen.

Yle News

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