Law on Mobilization Adopted, Use of Russian Assets to Rebuild Ukraine, War Risks Insurance

Law on Mobilization Adopted: What Does It Provide for?

On 11 April 2024, the Verkhovna Rada adopted Law No. 3633-IX on mobilization, which will enter into force on 18 May 2024.

For more information about the new Law, please follow the link, where Vladyslav Kepko, Head of Employment and Military Law Practice at Syrota, Dzis, Melnyk & Partners, provides a detailed description thereof.

PACE Voted for Resolution Calling for the Use of Russian Assets to Rebuild Ukraine

The Press Service of the Verkhovna Rada of Ukraine reports this in its post dated 16 April 2024.

Thus, the Parliamentary Assembly of the Council of Europe supported the Resolution by 134 votes.

The Resolution itself calls on the international community to:

  • establish an international compensation mechanism under the auspices of the Council of Europe to comprehensively compensate for the damage caused to individuals and legal entities, including the Ukrainian state, as a result of the Russian aggression;
  • active cooperation of states in the speedy transfer of existing assets of the Russian Federation to the established international compensation mechanism, in particular, to use them for the reconstruction of Ukraine;
  • create an international trust fund to which all Russian state assets will be transferred for safekeeping;
  • create an impartial and effective international commission to review claims filed by Ukraine and affected entities, as well as individuals and legal entities, seeking compensation for damages caused by the Russian aggression.

Export Credit Agency will Insure Investments in Ukraine against Military and Political Risks: Procedure and Conditions Approved

On 09 April 2024, by Resolution No. 388, the Government approved the list of military and political risks, as well as the terms and procedure for their insurance (reinsurance) by the Export Credit Agency (ECA).

The Government reports that this mechanism will eliminate gaps that limit the possibility of insuring domestic investments by the ECA, in particular in the context of hostilities and post-war recovery.

Thus, war risks include insurance risks that are common in international practice and that may arise on the territory of Ukraine:
military conflict, including war or armed conflict, armed aggression, hostilities, mass disturbances;

  • violent change or overthrow of the constitutional order or seizure of state power;
  • terrorist acts and/or sabotage;
  • occupation, annexation.

Political risks include the following:

  • forced alienation of property / seizure of property of a business entity by the state authorities of Ukraine (deprivation of property rights);
  • unreasonable revocation of a license by the market regulator or forced termination of a business entity by state authorities, as established by a court decision;
  • failure or refusal to fulfill the obligations set forth by the state in the legislation, strategic or program documents approved in accordance with the procedure established by law, and/or an investment agreement, provided that the business entity has the right to demand the fulfillment of such obligations;
  • the introduction by the state of a ban (payment embargo, moratorium) on payments;
  • impossibility of currency conversion or transfer of currency abroad by a business entity, except as provided by law.

We would also like to remind you that at the end of 2023, the Verkhovna Rada adopted the Law allowing the ECA to insure against war risks the investments of Ukrainian and foreign companies in Ukraine.