ILI lawyer Svitlana Hordiienko spoke about the difficulties of managing arrested property

Arrested assets in Ukraine have been sitting idle without management for years, losing value and generating no revenue for the state budget. This was stated by Institute of Legislative Ideas lawyer-analyst Svitlana Hordiienko on air for Ukrainian Radio.

"The number of assets that have actually been transferred to ARMA following arrest is very large – we are talking about thousands of objects. However, only a handful reach the stage of a competition for the selection of a temporary manager. The lost benefit from these assets, which are already arrested and formally transferred to ARMA for management, is colossal. That is, we can speak of millions and billions of hryvnias that could be flowing into the state budget from the management of these assets," the expert said.

According to her, a telling example of this systemic problem is the case of Colonel-General of the Russian Armed Forces Valerii Kapashin. More than 53 residential and commercial real estate objects were identified within the framework of criminal proceedings. Only 18 of them were put up for competition, and only nine are actually under management.

"This case specifically illustrates the systemic problem and the delays in transferring arrested assets to management. For almost two years, these assets generated absolutely no economic benefit for the state. They were simply arrested and transferred to ARMA for the purpose of management," Svitlana Hordiienko noted.

She added that another high-profile case was the house of former Interior Minister Vitalii Zakharchenko in Kyiv region. ARMA was unable to even inspect the property for an extended period of time.

"ARMA representatives stated that they could not begin managing or inspecting the property because they did not have the keys to the house. It then emerged that other individuals were using the property. After the situation received public attention, it was resolved and third parties' access to the house was terminated," the ILI lawyer explained.

In Svitlana Hordiienko's view, effective management of arrested property is hampered by the multi-stage procedure for preparing assets, finding managers, and completing acceptance-transfer acts, as well as ARMA's limited administrative capacity.

"This takes a very long time, and at the same time one must understand that it also consumes ARMA's administrative capacity. That is, due to the limited number of people working on this and the large number of assets, it is very difficult to cover everything," she explained.

The ILI expert recalled that at the end of 2024, amendments were made to the law on ARMA, introducing a new procedure with clear deadlines and a division of assets into simple and complex categories. Simple assets are to be transferred to management more quickly, while complex ones are to go to qualified specialist managers.

"The legislators and all those involved in this reform tried to make it as good and effective as possible, so that the procedure would move faster and accumulate as much revenue for the state budget as possible. However, it is too early to draw conclusions: the first competitions under the new procedure have only just started and the submission of proposals has not even closed yet," Svitlana Hordiienko concluded.