On April 26, the Parliament Committee on Legal Policy supported draft law No. 8392 “On Amendments to Certain Legislative Acts of Ukraine on Sanctions” in the second reading. This document should coordinate the procedure for the collection of Russian assets into state income.
The draft law was initiated by a group of MPs led by Denys Maslov.
Transparency International Ukraine experts analyzed how useful this draft law is and what issues may arise.
What was it like before?
In May 2022, the Parliament adopted the Law “On Amendments to Certain Legislative Acts of Ukraine to Increase the Effectiveness of Sanctions Related to Assets of Individuals.” It introduced a new type of sanctions — collection of assets into state income (confiscation). This sanction was directed at Russian collaborators who support Russia’s war against Ukraine. According to the adopted Law, this sanction can be applied only by the decision of the High Anti-Corruption Court (HACC) and during the period of martial law in Ukraine.
Overall, this Law provided for a well-considered procedure for collection of objects of property rights into state income and an exhaustive list of grounds for confiscation of property. However, issues on distribution of functions to implement this mechanism among institutions and its compliance with the ECtHR standards remained in question. We previously analyzed the pros and cons of the new sanctions procedure.
Proposed change
Draft law No. 8392 proposes a number of amendments to the sanctions legislation. These innovations are aimed at changing the procedure for imposing a sanction in the form of confiscation of assets into the state income. Here are some of the suggestions:
- establish the period for filing a confiscation claim in the Code for Administrative Procedure as the period of martial law;
- increase the term of consideration of the sanction case by the High Anti-Corruption Court from 10 to 30 days from the date of receipt of the claim by the court;
- establish that in order for the non-appearance of the participants in the case not to prevent its consideration, such participants must be properly notified of the date, time, and place of the hearing;
- increase the term of appeal consideration of sanction cases from 5 to 15 days;
- establish that consideration of sanction cases initiated during the period of martial law shall be completed according to the rules defined by the Code of Administrative Procedure of Ukraine. This does not apply to cases in respect of which a corresponding court decision was made at the time of termination or cancellation of martial law. At the same time, the termination or cancellation of martial law in itself is not an independent reason for closing the proceedings in such cases.
Enforcement of the previous version of the Code of Administrative Procedure in sanctions cases highlighted a number of shortcomings described in our analysis of verdicts in cases on the confiscation of assets belonging to Russian oligarchs Shelkov and Deripaska. This draft law is designed to fix them.
In addition, the draft law provides for the creation of the State Register of Sanctions — a single database that would allow for a quick and convenient search of sanctioned entities for state authorities and other actors. The explanatory note indicates that the portal should be launched precisely because currently, there is no single database related to this. That is, it mostly refers to its use by the Ministry of Justice, which is authorized to submit a claim to the HACC for the collection of assets previously blocked by the National Security and Defense Council and belonging to pro-Russian individuals.
Initially, the draft law indicated that the source of the register’s information is the decision of the National Security and Defense Council of Ukraine, put into effect by the decree of the President. That is, the decision of the HACC regarding the collection of assets into the state income was not going to be included in the register. However, before the second reading, MPs took into account the amendment which included HACC decisions on confiscation into the database, which is commendable.
Recommendations of Transparency International Ukraine
The above changes are appropriate, but the draft law can be strengthened even more to avoid its potential non-compliance with international standards, by means of the following additional amendments:
- provide that the calculation of time limits for filing procedural statements in sanction cases is covered by Art. 120, part 9 of the Code of Administrative Procedure. This article stipulates that the deadline is not considered missed if the statement of claim, complaint, other documents or materials or money is sent by post or transferred by other appropriate means of communication before its termination;
- increase the deadline for submitting revocation from 2 to 10 days. This change corresponds to the logic of the draft law, which proposes to increase the terms of consideration of the cases by the HACC.
Conclusions
In general, Transparency International Ukraine supports the changes proposed by the MPs. In our opinion, such updates significantly improve the judicial process of consideration of sanctions cases and bring us closer to international standards. This is a safeguard against potential successful appeals of HACC decisions by Russian and pro-Russian oligarchs in international courts. However, there is still room for improvement in the sanctions procedure that should be taken into account.
The analysis was prepared by Nataliia Sichevliuk, legal advisor of Transparency International Ukraine.
This publication was prepared with the financial support of the European Union. The contents of this publication are the sole responsibility of Transparency International Ukraine and do not necessarily reflect the views of the European Union.
