“Lozovyi’s Amendments” and Abuse in the Defense Sphere: Why HACC Judge Refused to Close the Case of Ihor Hladkovskyi

On June 24, 2024, investigating judge Olena Tanasevych refused the defense counsel’s request to close the proceedings against Ihor Hladkovskyi.  

Having announced the short text of the ruling, Judge Tanasevych stated that she did not agree with either the position of the defense counsel or the prosecution. She promised to answer all the questions in the full text of the ruling and formulate her vision of the situation. 

This decision causes double interest on the part of both journalists and experts. In addition to the case being one of the most high-profile ones in Ukrainian history, this decision was one of the first within the framework of the analysis of the grounds for closing criminal proceedings due to the “Lozovyi’s amendments” after their partial abolition by the law of December 8, 2023.  

Since the full decision to refuse to close the case of Hladkovskyi Jr. recently appeared in the Register of Court Decisions, we analyzed this document to find out the arguments of the judge.

What is this case about, and what is happening in court?

According to the prosecution, Hladkovskyi Jr. used the influence of his father, who held the position of First Deputy Secretary of the NSDC of Ukraine and had influence on the activities of defense enterprises participating in the State Concern Ukroboronprom. According to the NABU-SAPO, Ihor Hladkovskyi did all this to obtain an improper advantage.  

Thanks to his father, Hladkovskyi Jr. managed to have Pavlo Bukin appointed to the post of General Director of Ukrspecexport in February 2016. In response to such a “service,” Bukin had to conclude contracts on behalf of this state-owned company with firms controlled by Hladkovskyi Jr. Such agreements were to be concluded on terms that would allow the son of the former first Deputy secretary of the NSDC to get his own benefit.  

Thus, Hladkovskyi Jr. prepared the basis for himself, with the help of which, in August 2016, agreements were signed with the director of Ukrspecexport Pavlo Bukin on the purchase of on-board radio-electronic equipment at inflated prices, which led to almost UAH 13 million in losses for Ukrspecexport. We are talking about the very “altimeters”; Ukrainians learned about them from one of the most high-profile investigations of the Bihus.Info team in March 2019.  

To implement the criminal plan, Ihor Hladkovskyi involved AN Service LLC. In turn, AN Service concluded an agreement on the supply of altimeters with Asia Capital Overseas Limited (registered in the Special Administrative Region of the People’s Republic of China, Hong Kong). Since Hladkovskyi Jr. influenced this allegedly Chinese company, after transferring the payment to its accounts, he received an improper advantage in the amount of USD 170,000.  

The NABU-SAPO served Hladkovskyi with a suspicion notice in October 2023 and sent an indictment to the HACC in June 2024. The first preparatory hearing on the charge against Hladkovskyi Jr. was held on June 14, 2024. Almost immediately, the lawyers filed a motion to close the criminal proceedings due to the expiration of the terms of the pre-trial investigation. The defense counsel referred to Article 284, part 1, clause 1 of the Criminal Procedural Code of Ukraine; that is, they asked to close the criminal proceedings since the terms of the pre-trial investigation expired after the defendant had been served with a suspicion notice.  

In court hearings, the defense counsel referred to the ruling of the investigating judge on November 20, 2023, which refused to grant the motion for the arrest in absentia of Pavlo Bukin. Moreover, the judge then came to the conclusion that in that case, the terms of the pre-trial investigation had indeed expired before Pavlo Bukin and Ihor Hladkovskyi were served with suspicion notices. We can assume that the case was not closed in November because it was not within the competence of the investigating judge to resolve the issue of closing the criminal proceedings due to the expiration of the statute of limitations.

How did the judge motivate her decision?

During the entire existence of the CPC of Ukraine, Article 219, which regulates the terms of the pre-trial investigation, has been amended several times. On March 16, 2018, the so-called “Lozovyi’s amendments” came into force, which introduced a period calculated from the moment of entering information into the Unified Register of Pre-Trial Investigations and before serving the person with a suspicion notice. Such a term is differentiated and depends on the gravity of the criminal offense.  

The final provisions of the law, which introduced Lozovyi’s amendments, provided that these changes did not have a retroactive effect in time and applied to cases in which information about a criminal offense was entered into the Unified Register of Pre-Trial Investigations after the enactment of these rules in 2018.  

The proceedings, within the framework of which Bukin was served with a suspicion notice, were entered into the Unified Register of Pre-Trial Investigations in March 2019, that is, after the entry into force of the “Lozovyi’s amendments.” Therefore, they have already included the term before serving a person with a suspicion notice. In March 2020, the prosecutor merged the proceedings within which Bukin was served with a suspicion notice with other proceedings, the information on which had been entered into the Unified Register of Pre-Trial Investigations before March 16, 2018, that is, before the entry into force of the “Lozovyi’s amendments.”  

So, the prosecutor, by his decision, consolidated pre-trial investigations. In one of them, the period of pre-trial investigation was not calculated from the moment of entering information about a criminal offense into the Unified Register of Pre-Trial Investigations, and in the other, such a period was calculated.  

Analyzing similar situations in other cases, we pointed out: if we make a relationship between the date of entering information about criminal proceedings in the Unified Register of Pre-Trial Investigations and the application of the “Lozovyi’s amendments,” the pre-trial investigation bodies may abuse this. The abuse will consist in the artificial consolidation of “old” criminal proceedings with “new” ones so that the pre-trial investigation in the proceedings with suspects is extended not by the investigating judge but by the head of the prosecutor’s office. 

For example, in the PrivatBank case, we analyzed the facts under pre-trial investigation. We established that the investigation concerned the assets of one bank; and, according to the pre-trial investigation body, the criminal offenses were committed partly by the same defendants and mostly under the same qualification. This made it possible to state that during the consolidation of criminal proceedings, there was no abuse, instead, such a consolidation was carried out to increase the effectiveness of the pre-trial investigation. Therefore, in criminal proceedings 12017040000000531, “Lozovyi’s amendments” were not to be applied. 

Judge Olena Tanasevych applied an identical approach. She analyzed the progress of the criminal proceedings against Hladkovskyi and Bukin, and the facts under which they were carried out: 

“… the documents provided to the court indicate the connection of all the factual circumstances established in the criminal proceedings No. 42016110350000102 in 2015-2023, within the framework of which the investigation of illegal actions of the same individuals and legal entities in the defense sphere of Ukraine took place. According to the investigation, these actions revolved around the implementation of the common intention of these persons to seize budget funds allocated for public procurement conducted by state-owned enterprises that were part of the SC Ukroboronprom—SE Lviv Armored Fighting Vehicle Plant, SE Mykolaiv Armored Factory, Kyiv Armored Plant, SE Zhytomyr Armored Plant, SE Iziumskyi Instrument-Making Plant, SE Ukrspecexport, with the involvement of officials of the Ministry of Defense of Ukraine, the National Security and Defense Council of Ukraine, etc.” 

We agree that this is the right and correct approach to assessing whether the “Lozovyi’s amendments” regarding the period of pre-trial investigation should be extended to serving a person with a suspicion notice.

A controversial point in the court ruling

According to the prosecutor in this case, currently, Article 219 of the Criminal Procedural Code does not provide a deadline for serving a person with a suspicion notice, and therefore the defense counsel’s motion is irrelevant. However, the judge, immediately after the announcement of the ruling, noted that she did not agree with this point.  

In the court decision, Judge Tanasevych drew attention to this. She indicated that the new version of Article 219 of the Criminal Procedural Code of Ukraine d not relieve the court from the duty to investigate whether the term of pre-trial investigation was observed from the moment of entering information about a criminal offense into the Unified Register of Pre-Trial Investigations before the day of serving the person with a suspicion notice by December 31, 2023. 

On December 8, 2023, the parliament amended the CPC of Ukraine, partially abolishing the “Lozovyi’s amendments.” The MPs supplemented the transitional provisions of this law with a new clause: 

“20-8. The provisions of part one of Article 219 of this Code as amended by the Law of Ukraine on Amendments to the Criminal Procedural Code of Ukraine and Other Legislative Acts of Ukraine on Strengthening the Independence of the Specialized Anti-Corruption Prosecutor’s Office shall apply to all criminal proceedings, the pre-trial investigation or trial of which has not been completed before the date of entry into force of the Law of Ukraine on Amendments to the Criminal Procedural Code of Ukraine and Other Legislative Acts of Ukraine on Strengthening the Independence of the Specialized Anti-Corruption Prosecutor’s Office. 

Thus, the legislator provided a retroactive effect to the rules governing the procedure for extending the terms of pre-trial investigation, extending them to cases where:

• the pre-trial investigation has not been completed;
• the trial has not been completed.

In the case of Ihor Hladkovskyi, the pre-trial investigation had not yet been completed as of January 1, 2024. Therefore, the prosecutor’s opinion was correct for these reasons.  

The position of Judge Tanasevych in this part is controversial because the legislator directly indicated that to verify the existence of grounds to close cases under Article 284, part 1, clause 10 of the CPC of Ukraine, it is necessary to consider the new version of Article 219 of the CPC of Ukraine. It does not provide for restrictions on the term of pre-trial investigation in criminal proceedings without suspects.

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This case shows us two things. 

The approach to assessing whether “Lozovyi’s amendments” should be applied is gradually changing among judges, and that’s a good sign. After all, the key thing in assessing the protection of human rights in the context of a reasonable term of investigation is whether the prosecution did not allow for abuses. 

But, as we can see, there may be problems with clarifying the content of clause 20-8 of the Transitional Provisions to the CPC of Ukraine. Therefore, judges need to properly apply the methods of judicial interpretation to resolve them.