Confiscation of private assets: Ukrainian and foreign experience

During the online discussion ‘Frozen Russian Assets: How to Confiscate for the Benefit of Ukraine’, organized by the Centre for Economic Strategy (CES) in cooperation with the International Centre for Ukrainian Victory (ICUV) and KI Insights, Bohdan Karnaukh, IWI analyst, noted that the Institute of Legislative Ideas has been monitoring attitudes towards the confiscation of Russian assets in the world for two years using the Global Confiscation Tracker.

 ‘In general, we can see a positive trend in the attitude towards the confiscation of Russian assets,’ the expert said. The government officials, together with international experts and civil society representatives, discussed the recent decision of the Group of Seven to provide Ukraine with a $50 billion loan from the proceeds of frozen Russian assets.

 ‘It is important to understand,’ said Bohdan Karnaukh, ’that this decision does not put an end to the issue of confiscation of Russian assets. The allocation of the loan from the proceeds of the frozen Russian funds does not prevent the recovery of the principal amount. This is not the end of the story - it is only its first chapter.’

In the second part of his speech, Bohdan Karnaukh focused on the confiscation of private assets.

 According to the expert, Ukraine is currently leading the way in this matter, primarily due to the mechanism of asset recovery for the state revenue provided for in paragraphs 1-1 of part 1 of Article 4 of the Law of Ukraine ‘On Sanctions’. This refers to the recovery of assets by a decision of the High Anti-Corruption Court at the request of the Ministry of Justice.

 Some progress in this direction can be observed abroad. In particular, relevant legislation has been adopted in Canada and Estonia. However, Bohdan Karnaukh emphasizes that Western countries are more familiar with such traditional instruments as non-conviction-based forfeiture, fines, and other monetary penalties applied to violators of sanctions restrictions, as well as confiscation in criminal proceedings on charges of sanctions evasion.

The expert noted that all these instruments can be used to replenish funds to support Ukraine.