Article 250 of the Civil Code of the Russian Federation. Pre-emptive right of purchase (current version)

1. When selling a share in the right of common ownership to an outsider, the remaining participants in shared ownership have the pre-emptive right to purchase the share being sold at the price for which it is sold, and on other equal conditions, except in the case of a sale at public auction, as well as cases of sale of a share in the right of common ownership of a land plot by the owner of a part of a building or structure located on such a land plot or by the owner of premises in the specified building or structure.

Public auctions for the sale of a share in the right of common ownership in the absence of consent of all participants in shared ownership may be held in the cases provided for by part two of Article 255 of this Code, and in other cases provided for by law.

2. The seller of a share is obliged to notify in writing the other participants in shared ownership of his intention to sell his share to an outsider, indicating the price and other conditions under which he sells it. If the remaining participants in shared ownership refuse to purchase or do not acquire the sold share in the right of ownership of real estate within a month, and in the right of ownership of movable property within ten days from the date of notification, the seller has the right to sell his share to any person.

3. When selling a share in violation of the pre-emptive right, any other participant in shared ownership has the right, within three months, to demand in court the transfer of the rights and obligations of the buyer to him.

4. Assignment of the pre-emptive right to purchase a share is not permitted.

5. The rules of this article also apply when alienating a share under an exchange agreement.

Civil Code of the Russian Federation Part 1

Chapter 16. COMMON PROPERTY

Article 244. Concept and grounds for the emergence of common property

1. Property owned by two or more persons belongs to them under the right of common ownership.

2. Property may be in common ownership with the determination of the share of each owner in the right of ownership (shared ownership) or without determination of such shares (joint ownership).

3. Common ownership of property is shared, except for cases where the law provides for the formation of joint ownership of this property.

4. Common property arises when two or more persons acquire property that cannot be divided without changing its purpose (indivisible things) or is not subject to division by force of law.

Common ownership of divisible property arises in cases provided for by law or contract.

5. By agreement of the participants in joint ownership, and if no agreement is reached, by a court decision, shared ownership of these persons may be established on the common property.

Article 245. Determination of shares in the right of shared ownership

1. If the shares of participants in shared ownership cannot be determined on the basis of law and are not established by agreement of all its participants, the shares are considered equal.

2. By agreement of all participants in shared ownership, a procedure for determining and changing their shares may be established depending on the contribution of each of them to the formation and growth of common property.

3. A participant in shared ownership, who has carried out inseparable improvements to this property at his own expense in compliance with the established procedure for the use of common property, has the right to a corresponding increase in his share in the right to common property.

Separable improvements to common property, unless otherwise provided by agreement of the participants in shared ownership, become the property of the participant who made them.

Article 246. Disposal of property in shared ownership

1. The disposal of property in shared ownership is carried out by agreement of all its participants.

2. A participant in shared ownership has the right, at his own discretion, to sell, donate, bequeath, pledge his share or dispose of it in any other way, subject to the rules provided for in Article 250 of this Code during its alienation for compensation.

Article 247. Possession and use of property in shared ownership

1. Possession and use of property in shared ownership is carried out by agreement of all its participants, and if no agreement is reached, in the manner established by the court.

2. A participant in shared ownership has the right to be given for his possession and use a part of the common property commensurate with his share, and if this is not possible, he has the right to demand appropriate compensation from other participants who own and use the property falling on his share.

Article 248. Fruits, products and income from the use of property in shared ownership

Fruits, products and income from the use of property in shared ownership enter the common property and are distributed among the participants in shared ownership in proportion to their shares, unless otherwise provided by an agreement between them.

Article 249. Expenses for the maintenance of property in shared ownership

Each participant in shared ownership is obliged, in proportion to his share, to participate in the payment of taxes, fees and other payments on the common property, as well as in the costs of its maintenance and preservation.

Article 250. Pre-emptive right to purchase

1. When selling a share in the right of common ownership to an outsider, the remaining participants in shared ownership have the preemptive right to purchase the share being sold at the price for which it is sold and on other equal conditions, except in the case of sale at public auction.

Public auctions for the sale of a share in the right of common ownership in the absence of consent of all participants in shared ownership may be held in the cases provided for by part two of Article 255 of this Code, and in other cases provided for by law.

2. The seller of a share is obliged to notify in writing the other participants in shared ownership of his intention to sell his share to an outsider, indicating the price and other conditions under which he sells it. If the remaining participants in shared ownership refuse to purchase or do not acquire the sold share in the right of ownership of real estate within a month, and in the right of ownership of movable property within ten days from the date of notification, the seller has the right to sell his share to any person.

3. When selling a share in violation of the pre-emptive right, any other participant in shared ownership has the right, within three months, to demand in court the transfer of the rights and obligations of the buyer to him.

4. Assignment of the pre-emptive right to purchase a share is not permitted.

5. The rules of this article also apply when alienating a share under an exchange agreement.

Article 251. Moment of transfer of a share in the right of common ownership to the acquirer under an agreement

The share in the right of common ownership passes to the acquirer under the agreement from the moment the agreement is concluded, unless otherwise provided by agreement of the parties.

The moment of transfer of a share in the right of common ownership under an agreement subject to state registration is determined in accordance with paragraph 2 of Article 223 of this Code.

Article 252. Division of property in shared ownership and allocation of a share from it

1. Property in shared ownership may be divided between its participants by agreement between them.

2. A participant in shared ownership has the right to demand the allocation of his share from the common property.

3. If the participants in shared ownership fail to reach an agreement on the method and conditions for the division of common property or the allocation of the share of one of them, the participant in shared ownership has the right to legally demand the allocation in kind of his share from the common property.

If the allocation of a share in kind is not permitted by law or is impossible without disproportionate damage to property in common ownership, the allocated owner has the right to have the value of his share paid to him by other participants in shared ownership.

4. The disproportion between the property allocated in kind to a participant in shared ownership on the basis of this article and his share in the right of ownership shall be eliminated by payment of the appropriate amount of money or other compensation.

Payment of compensation to a participant in shared ownership by the remaining owners instead of allocating his share in kind is permitted with his consent. In cases where the owner’s share is insignificant, cannot be realistically allocated and he does not have a significant interest in the use of the common property, the court may, even in the absence of the consent of this owner, oblige the remaining participants in the shared ownership to pay him compensation.

5. Upon receipt of compensation in accordance with this article, the owner loses the right to a share in the common property.

Article 253. Possession, use and disposal of jointly owned property

1. Participants in joint ownership, unless otherwise provided by agreement between them, jointly own and use common property.

2. The disposal of jointly owned property is carried out by the consent of all participants, which is assumed regardless of which of the participants makes the transaction to dispose of the property.

3. Each of the participants in joint ownership has the right to enter into transactions for the disposal of common property, unless otherwise follows from the agreement of all participants. A transaction related to the disposal of common property made by one of the participants in joint ownership may be declared invalid at the request of the remaining participants on the grounds that the participant who made the transaction does not have the necessary powers only if it is proven that the other party to the transaction knew or obviously should have was aware of this.

4. The rules of this article apply to the extent that this Code or other laws do not establish otherwise for certain types of joint ownership.

Article 254. Division of jointly owned property and allocation of a share from it

1. The division of common property between the participants in joint ownership, as well as the allocation of the share of one of them, can be carried out after the preliminary determination of the share of each of the participants in the right to the common property.

2. When dividing common property and separating a share from it, unless otherwise provided by law or agreement of the participants, their shares are recognized as equal.

3. The grounds and procedure for the division of common property and the allocation of a share from it are determined according to the rules of Article 252 of this Code insofar as otherwise for certain types of joint property is not established by this Code, other laws and does not follow from the essence of the relations of the participants in joint property.

Article 255. Foreclosure of a share in common property

The creditor of a participant in shared or joint ownership, if the owner of other property is insufficient, has the right to make a demand for the allocation of the debtor's share in the common property for foreclosure on it.

If in such cases the allocation of a share in kind is impossible or the remaining participants in shared or joint ownership object to this, the creditor has the right to demand that the debtor sell his share to the remaining participants in the common property at a price commensurate with the market value of this share, with the proceeds from the sale being used to repay the debt.

If the remaining participants in the common property refuse to acquire the debtor's share, the creditor has the right to demand in court the foreclosure of the debtor's share in the common property right by selling this share at public auction.

Article 256. Common property of spouses

1. Property acquired by spouses during marriage is their joint property, unless an agreement between them establishes a different regime for this property.

2. Property that belonged to each of the spouses before marriage, as well as property received by one of the spouses during marriage as a gift or by inheritance, is his property.

Items for personal use (clothing, shoes, etc.), with the exception of jewelry and other luxury items, although acquired during marriage at the expense of the spouses’ common funds, are recognized as the property of the spouse who used them.

The property of each spouse may be recognized as their joint property if it is established that during the marriage, investments were made from the common property of the spouses or the personal property of the other spouse that significantly increased the value of this property (major repairs, reconstruction, re-equipment, etc. ). This rule does not apply if the agreement between the spouses provides otherwise.

The exclusive right to the result of intellectual activity belonging to the author of such result (Article 1228) is not included in the common property of the spouses. However, income received from the use of such a result is the joint property of the spouses, unless otherwise provided by an agreement between them. (paragraph introduced by Federal Law of December 18, 2006 N 231-FZ)

3. For the obligations of one of the spouses, recovery may be made only on the property owned by him, as well as on his share in the common property of the spouses, which would be due to him upon division of this property.

4. The rules for determining the shares of spouses in common property during its division and the procedure for such division are established by family law. (as amended by Federal Law No. 49-FZ dated April 24, 2008)

Article 257. Property of a peasant (farm) enterprise

1. The property of a peasant (farm) enterprise belongs to its members on the right of joint ownership, unless otherwise established by law or an agreement between them.

2. The joint ownership of members of a peasant (farm) enterprise includes the land plot granted to this farm or acquired, outbuildings and other buildings, reclamation and other structures, productive and working livestock, poultry, agricultural and other machinery and equipment, vehicles, inventory and other property acquired for the farm using the common funds of its members. (as amended by Federal Law dated December 4, 2006 N 201-FZ)

3. Fruits, products and income received as a result of the activities of a peasant (farm) enterprise are the common property of the members of the peasant (farm) enterprise and are used by agreement between them.

Article 258. Division of property of a peasant (farm) enterprise

1. When a peasant (farm) enterprise is terminated due to the withdrawal of all its members or for other reasons, the common property is subject to division according to the rules provided for in Articles 252 and 254 of this Code.

In such cases, the land plot is divided according to the rules established by this Code and land legislation.

2. A plot of land and means of production belonging to a peasant (farm) enterprise are not subject to division when one of its members leaves the enterprise. Those who leave the farm have the right to receive monetary compensation commensurate with their share in the common ownership of this property.

3. In the cases provided for by this article, the shares of members of a peasant (farm) enterprise in the right of joint ownership of the property of the enterprise are recognized as equal, unless otherwise established by agreement between them.

Article 259. Property of a business partnership or cooperative formed on the basis of the property of a peasant (farm) enterprise

1. Members of a peasant (farm) enterprise may create a business partnership or production cooperative on the basis of the property of the farm. Such a business partnership or cooperative, as a legal entity, has the right of ownership to property transferred to it in the form of contributions and other contributions by members of the farm, as well as to property received as a result of its activities and acquired on other grounds permitted by law.

2. The amount of contributions of participants in a partnership or members of a cooperative created on the basis of the property of a peasant (farm) farm is established based on their shares in the right of common ownership of the property of the farm, determined in accordance with paragraph 3 of Article 258 of this Code.

Article 250 of the Civil Code of the Russian Federation. Pre-emptive right of purchase (current version)

The vesting of participants in common property with a preemptive right to purchase an alienated share is due to the specifics of the emerging legal relations between these persons.

A participant in common ownership does not have discretion in exercising his powers as an owner.

The preemptive right is aimed at terminating the right of common property and the emergence of the right of private property or reducing the number of participants in the legal relationship of common property and, as a result, reducing conflicts to a minimum.

The preemptive right can be circumvented by alienating either a small part of the share or the entire share on the basis of a gratuitous transaction. The preemptive right in the legal relationship of common property can be circumvented by making a gift transaction. However, even in this case, the copyright holder can protect it by declaring the transaction invalid. As an analysis of judicial practice shows, the main difficulty lies in proving the sham of the transaction.

1. Allowing the possibility of a participant in shared ownership to dispose of his share in property rights, the legislator at the same time strives to ensure the interests of other owners of common property. The opportunity to purchase a share allows co-owners to avoid the emergence of a new entity among them. This is served by the priority right of participants in shared ownership over other persons to acquire a share alienated by a co-owner. From paragraph 1 of the commented article it follows that the pre-emptive right to purchase applies to paid transactions (purchase and sale, barter). In case of gratuitous alienation of a share - gift, transfer by inheritance, the preemptive right does not apply, since gratuitous transactions do not provide for reciprocal provision and are carried out, as a rule, in relation to persons with whom the participant in shared ownership has developed certain personal relationships. In addition, the preemptive right only applies when the share is alienated to a third party. When acquiring a share by a participant in common shared ownership, the pre-emptive right does not apply. A mandatory condition for the implementation of the preemptive right is the acquisition by the co-owner of the thing on other equal conditions. The effect of the pre-emptive right to purchase is limited to the period established by law (see commentary to paragraph 2 of this article).

The preemptive right does not apply to cases of alienation of a share in the right of common ownership at public auction, as well as cases of sale of a share in the right of common ownership of a land plot by the owner of a part of a building or structure located on such a land plot or by the owner of premises in the specified building or structure.

The absence of a preemptive right to purchase during a sale at a public auction is determined by the legal nature of such auctions: their participants must have equal opportunities to acquire property.

At the same time, the provisions of the commented article do not prevent a participant in common shared ownership interested in acquiring a share from participating in public auctions on a general basis.

2. Based on paragraph. 2 clause 1 of the commented article, as well as clause 1 of Art. 447 of the Code, auctions for the sale of property that is the object of common shared ownership (in the absence of the consent of all co-owners) can be held only in cases directly provided for by law and in the manner established by it.

The Land Code of the Russian Federation establishes special rules for the alienation of a share in the ownership of a land plot occupied by a building. According to paragraph 3 of Art. 35 of the Land Code, the owner of a building or structure located on someone else’s land plot has a pre-emptive right to purchase the land plot.

3. A mandatory condition for the sale of a share is notification of the co-owners about the sale, which must contain an indication of the object of sale and the price. Notice must be given in writing. The law may determine the specifics of notifying co-owners of the sale of a share. Thus, Order of the Ministry of Economic Development of Russia dated November 17, 2021 N 724 approved the Procedure for posting a notice of participants in shared ownership of real estate about the intention to sell a share in the right of common ownership of real estate on the official website of the rights registration authority on the information and telecommunications network Internet. When notarizing a transaction for the alienation of a share in the ownership of real estate, the proper fulfillment of the obligation to notify co-owners of the sale of the share is checked.

Within the meaning of the commented article, a notice of intention to sell a share in ownership is not an offer; accordingly, the notice does not create an obligation for the owner to enter into an agreement for the sale of a share in ownership. He may refuse to sell the share, but cannot sell it to third parties, bypassing the co-owners.

4. The right of first refusal is valid for the period established by law, calculated from the moment of notification of the sale of the share. If, within the established period, the participants in shared ownership do not acquire the share of ownership being sold, the seller has the right to sell his share to any person. If all participants in shared ownership refuse in writing to exercise the pre-emptive right to purchase the share being sold, such share may be sold to an outsider earlier than the deadlines established by law.

5. When selling a share in violation of the pre-emptive right, any other participant in shared ownership has the right, within three months, to demand in court the transfer of the rights and obligations of the buyer to him. Claims submitted after the specified deadline are not subject to satisfaction. At the same time, according to the citizen’s application in relation to Art. 205 of the Code, this period can be restored by the court if the citizen missed it for valid reasons.

In the event of a violation of the right of first refusal of a co-owner of real estate, a judicial act that satisfied the claim for the transfer of the rights and obligations of the buyer is the basis for making appropriate entries in the Unified State Register. Since filing a demand for the transfer of the buyer’s rights in the event of a violation of the pre-emptive right to purchase is a special method of protection provided for such situations, a claim to invalidate the transaction will not be recognized as an appropriate method of protecting the violated right and is not subject to satisfaction (clause 14 of the Resolution of the Plenum of the Supreme Court of the Russian Federation and the Plenum Supreme Arbitration Court of the Russian Federation dated April 29, 2010 N 10/22 “On some issues arising in judicial practice when resolving disputes related to the protection of property rights and other property rights”).

6. The preemptive right to purchase a share belongs equally to all co-owners. If several co-owners express a desire to purchase a share in the right of ownership, the seller of the share has the right to choose with which of them to enter into an agreement. A share can also be purchased by several co-owners.

7. The assignment of the pre-emptive right to purchase a share is not allowed, since this contradicts its purpose - to ensure the interests of specific persons - co-owners.

8. The rules of the commented article also apply when alienating a share under an exchange agreement, if it is possible to provide the owner alienating the share with the equivalent of what he expects to receive as consideration.

Comment source:

“CIVIL CODE OF THE RUSSIAN FEDERATION. PART ONE. ARTICLE-BY-ARTICLE COMMENT"

S.P. Grishaev, T.V. Bogacheva, Yu.P. Sweet, 2019