The Land Administration Review of the Russian Federation, produced by the UN Economic Commission for Europe (ECE), points to sweeping changes brought about through privatization, the development of land markets and a whole new system of agricultural holdings.

Over 50 million people and legal entities acquired private ownership rights in the country, and by the end of the 1990s some 7.6 per cent of the Russian Federation's territory was privately owned, the report states. This percentage represents 129 million hectares of land and is comparable to the area of continental Western Europe.

In theory, all the elements necessary for an effective land policy are in place, but practical problems remain, the report cautions. Chief among these is the fact that several competing agencies are involved in land administration. "This undermines the effectiveness of the system and leads to conflicts of interests," the ECE observes, calling land policy implementation "incoherent."

The report says the most controversial elements of Russia's land and property administration stem from the mixture of public law and private-law functions within one State authority. "An obvious conflict of interest arises when decisions on land and other real property are taken by the agency that also has the authority to represent the interests of the owner of the [federal] property," the Commission says, calling this situation a legacy of Soviet land law which put all holdings under State ownership.

The report warns that the State's influence "reduces the confidence of other parties in the reliability of the market infrastructure and the real property market in general."