Recovering from Russian-inflicted damage: ways to ensure compensation
Processes to recover funds from the aggressor began in 2014. Private businesses were the first to do so, applying to investment arbitration under agreements on mutual protection of investments that were violated by the Russian Federation when it annexed Crimea. These are companies such as Naftogaz, Ukrnafta, PrivatBank, Oschadbank, Belbek Airport, etc.
And some of them have already received positive arbitral awards and had these decisions recognized abroad. Of course, enforcement of the awards remains a challenge, but work is underway in this area.
As for people's private property, the state of Ukraine itself reimbursed war-related expenses within the limit of UAH 300,000 ($8,126).
After the full-scale invasion, the situation escalated, and work immediately began on developing two mechanisms: international compensation (recovery of Russian property abroad) and sanctions (property located in Ukraine).
The features of the international one include:
- A register of damages caused by the Russian Federation to Ukraine, its citizens and businesses is created;
- A fund is being set up to be filled with funds that have already been seized in huge quantities and should be recovered in favor of Ukraine, as well as donor funds;
- a Commission is established to make decisions on compensation payments;
- there will be a special procedure for implementing the Commission's decisions.
The Government of the Netherlands has agreed to establish a Register of Damage Caused to Ukraine by Russian Aggression in The Hague. This is a very important step that will help ensure that funds are allocated internationally for the reconstruction of Ukraine, even if the hostilities themselves continue.
As for the sanctions mechanism, which confiscates the property of Russians in Ukraine, the corporate rights and financial assets of banks have already been nationalized, and a successful appeal has been initiated to recover the property of Yevtushenkov, Shelkov, Yanukovych, Deripaska, Rotenberg, Giner, Saldo, etc.
The confiscated assets are sold at an online auction, which provides the maximum level of protection against leakage of data on potential bidders until the auction starts. This ensures that there is no abuse. The property of the Russian Federation and its agents is inherently toxic, as the Russians are unlikely to let it go so easily. Therefore, legally, the sale process must be perfect.
Of course, no amount of money and assets can compensate for the level of grief and suffering that the aggressor has caused to Ukraine and its citizens. But the current processes show that Ukraine and Ukrainians are capable of defending themselves both on the battlefield and in the legal sphere. And the enemy will suffer its losses both ways.
