![](https://ti-ukraine.org/wp-content/uploads/2023/10/20_10_fridman_pick.png)
![](https://ti-ukraine.org/wp-content/uploads/2023/10/20_10_fridman_pick.png)
How will the seizure of vital services owned by Russian oligarchs affect the lives of Ukrainians? How does the process of such seizure take place and will Ukraine be able to get any real benefit from this property? Find out in our material.
Last week, the court seized all corporate rights in Ukraine belonging to sanctioned Russian oligarchs Mikhail Fridman, Petr Aven, and Andrei Kosogov.
According to Ekonomichna Pravda, among the seized assets were 100% of the authorized capital of LLC lifecell and 99.99% of the authorized capital of PJSC Kyivstar, Kyivstar’s own shares in other companies, in particular LLC Healthy Ukraine, the same HELSI.me service through which millions of Ukrainians make doctors’ appointments and where patients’ medical data are stored.
This news caused quite a stir. Even after the information that it is not about the seizure of these companies in full, but only about the shares of Russian oligarchs (19.8% of the authorized capital of lifecell and 47.85% of the authorized capital of Kyivstar), many questions remain about the present and future of this property.
We have analyzed out the situation, so let us share answers about the prospects of the seized property of Putin’s friend Fridman, and how it will affect the lives of Ukrainians.
1. What will happen to Kyivstar’s and lifecell’s operational activities after this seizure? Can there be interruptions in communications?
It should be said at once that the seizure of corporate rights does not directly relate to the company’s operating activities, so at least in the near future, there should be no problems with the communications.
Corporate rights are, for example, about how investors, the same Fridman and Aven, profit from the company’s activities. At the same time, they are indirect owners, that is, they do not own the corporate rights of Kyivstar and lifecell directly. In general, corporate relations are more about the relationship between the investor and the company itself, which already has management, directors, and management personnel. Of course, it will continue providing services or producing products.
The shares in Kyivstar and lifecell are not the only assets of Fridman that have already been seized. Thus, last autumn, corporate rights to Morshynska were transferred to the ARMA for management. Even though the company still operates without a manager selected in the competition, bottles with this famous water have not disappeared from the shelves of stores.
The shares in Kyivstar and lifecell are not the only assets of Fridman that have already been seized. Thus, last autumn, corporate rights to Morshynska were transferred to the ARMA for management. Even though the company still operates without a manager selected in the competition, bottles with this famous water have not disappeared from the shelves of stores.
2. Does it mean that, after the seizure, these assets will now belong to the state?
No, the owners of the seized shares of these and dozens of other companies associated with Russia continue to be Fridman, Aven, and other pro-Russian oligarchs, who are suspected of financing actions committed with the aim of forcibly changing or overthrowing the constitutional order or seizing state power, changing the boundaries of the territory or state border of Ukraine. And so it will be until the courts deliver verdicts in these cases, and these verdicts declare the confiscation of all seized property.
All because it is about the seizure in criminal proceedings, and not about confiscation.
In addition, Ukraine has a sanctions mechanism under which the National Security and Defense Council introduces a temporary blocking of assets, the Ministry of Justice prepares a claim and appeals to the High Anti-Corruption Court to recover the assets of Russia’s supporters. In the same way, the law On Sanctions outlines a list of grounds for such confiscation, among which, again, there is aiding the aggressor state or other assistance to its activities. This method of confiscation seems simpler, but the mechanism of criminal proceedings is more proven and reliable, although it takes much longer.
In any case, Fridman will not be able to receive income from the seized property, and after the conviction of the court, it will pass to Ukraine.
In any case, Fridman will not be able to receive income from the seized property, and after the conviction of the court, it will pass to Ukraine.
3. And how can this transfer happen?
Here, the options may be different. If the Ministry of Justice does collect evidence and file a claim with the HACC, it is likely that such a claim will be satisfied; then the assets will be confiscated, transferred to state ownership, and transferred to the State Property Fund by a court decision. The SPFU will be able to sell these assets at the relevant tender.
Another way is the already mentioned confiscation of Fridman’s property after the court, with its verdict, recognizes that the oligarch did finance and contribute to the aggression of Russia in Ukraine.
4. What if Fridman wants to appeal the decision on the seizure or even sell this property?
In general, it is usual for a person to seek protection of their rights in court even given the fact that they may indeed be guilty of the crimes mentioned, and despite our attitude towards them. This is a civilized European approach that our country is striving for.
Another question is how to make it possible for Ukraine to lawfully alienate all these assets and not violate the rights of these people, which also threatens with appeals, for example, to the ECHR. Because if the confiscation of property takes place unlawfully, that is, in violation of the law, then this may be the basis for awarding compensation by Ukraine to the person from whom the property was collected.
It is also important that international sanctions are now imposed on these same assets. After all, ownership of them is formalized through foreign companies, and, accordingly, the decision of the Ukrainian court to seize them must be recognized and enforced abroad.
If we talk about the sale of this property by suspected oligarchs, then Ukraine has established criminal liability, in particular for committing actions with seized property. Therefore, the seizure of property is just a means that facilitates the pre-trial investigation and trial. After all, Fridman is no longer in the right to re-register this asset, sell it, or take any other actions aimed at making it disappear from the view of law enforcement agencies, at least in Ukraine, or in the state where the Ukrainian decision to seize assets will be recognized and enforced.
If we talk about the sale of this property by suspected oligarchs, then Ukraine has established criminal liability, in particular for committing actions with seized property. Therefore, the seizure of property is just a means that facilitates the pre-trial investigation and trial.
5. What if the court finds Fridman not guilty, will he get all this property back?
According to Ukrainian legislation, yes, because one can never reject the probability of innocence of a person.
But it seems to us that another option is more likely — that the Ministry of Justice will file a claim for the recovery of assets in accordance with the sanctions legislation. Criminal proceedings last much longer, and it is much more difficult to prove crimes in the courts. The latest actions of Fridman, who returned to Russia last week, for their part, add opportunities for a decision to confiscate such assets.
In any case, there are currently no prerequisites for the seizure or confiscation of this property to have a negative impact on the lives of Ukrainians. The sanctioned Fridman and Aven will definitely not receive a penny from these assets until the court decision.
There are currently no prerequisites for the seizure or confiscation of this property to have a negative impact on the lives of Ukrainians. The sanctioned Fridman and Aven will definitely not receive a penny from these assets until the court decision.