When Ukraine can get hundreds of billions of dollars of blocked Russian reserves, are changes to the law on oligarchs possible, why the reincarnation of pro-Russian parties is unlikely, what prevents the Russian leadership from being condemned for an attack on Ukraine, and is there any movement in the negotiations – in an interview with RBC-Ukraine said Minister of Justice Denis Malyuska.
– What is the situation with the blocking abroad and the transfer of Russian assets to Ukraine? Are we cooperating on this issue with Western partners or are the countries conducting these processes on their own?
– A large complex of all kinds of information to answer this question. I will try to describe in a few words. Indeed, we cooperate and there are a lot of areas of such cooperation. There is an international group “Freeze and Seize”, which includes representatives from the European Commission, from different countries, including Ukraine, which coordinates and searches for Russian assets and blocks them.
And there are activities of individual countries where Russian assets are located, which are also quite quickly, promptly looking for, blocking and, accordingly, responding to requests or messages, including from Ukraine, regarding what assets were found.
That is, if we take part of the asset blocking, it works almost perfectly. This process is underway, it is very active and it is going well, mainly because this is not the first time that our Western partners have blocked the assets of a country. There is a mechanism for this. Now, perhaps, it is at an unprecedented high level, compared to how it was used before.
As for the next step after the blocking of assets – their withdrawal from the owners, this is a fundamentally different story, because there are practically no legal instruments for such withdrawal. Except for the classic cases: if it is a crime, which provides for punishment, including in the form of confiscation, then everything is clear to Europeans or Americans. If we are talking about expropriation outside of a sentence, they have never met with this before. They understand that this needs to be done, but in most cases there are no mechanisms for this.
Therefore, now we are promoting the creation of such mechanisms abroad, and the process is taking place with varying speed and success. There is, for example, a law that Canada recently adopted regarding the allocation of funds for humanitarian purposes, including, possibly, to Ukraine, which will be received as a result of the seizure of property. Other countries have either opted for a wait-and-see position or are in the early stages of legislative work. Therefore, there is no really working mechanism so that we can show abroad: “Look, this incident has already happened,” there is no such mechanism yet.
Now we have focused on the most promising mechanism in order to get a quick result – this is the withdrawal of Russian gold and foreign exchange reserves, because, in our opinion, this is something that can be implemented in 7-8 months. And the funds that can come if this mechanism is implemented the way we want it are hundreds of billions of US dollars.
That is, this is the most interesting story in terms of both the amount and speed. However, again, there is the same story: it is necessary to coordinate the Western partners on the innovative mechanisms that we offer them.
– Do we have any time frame? That is, how long can this process of transferring Russian assets and funds to Ukraine last?
– It all depends on the speed, reaction and political decisions of our partners from Europe, the States, the UK. The money is there. The decision to sign an international treaty with us or adopt domestic legislation is also up to them. That is, technically, if at one fine moment a miracle happened and everyone said: “We agree with such a mechanism and with every comma in this mechanism,” the mechanism can be implemented in six months.
However, we are still far from that stage, because, again, there has never been such a practice. The amount at stake is enormous. There are colossal consequences at stake, because if this were applied to Russia, then it could be applied to other countries, which entails very ambiguous geopolitical consequences for many countries of the world and for many regions. Therefore, this process is slower than we would like.
– You said that now you are focusing on the fastest and best option, which may take 7-8 months. That is, this means that potentially the first transfers of assets and funds – in this case, gold and foreign exchange reserves – we can expect in 7-8 months, right?
– Yes. Will explain. In order for us to receive significant amounts of funds to a specially created fund for compensation for damage caused by Russia – we are talking about gold and foreign exchange reserves – it is necessary that the country where these funds are located conclude an appropriate international treaty, where immunity from such assets will be lifted and where it will agree to transfer these funds to a special fund.
In fact, the procedure is not complicated. The text of the agreement is being developed and agreed upon, it is signed between the governments of Ukraine and the country where the gold reserves are located. The treaty is ratified both on their side and on ours. That’s all – the implementation mechanism, the receipt of funds, their distribution among the victims went further.
That is, in principle, it is not difficult to sign and ratify this mechanism if there is political will. The question is to take this step: so that the country, not just some political figure, but the government, together with the parliament, agrees to this mechanism. And this is difficult, again – for various reasons.
Since we realized that it would take years to agree on one text of the treaty with a large number of countries at the same time, we tried to take the path of less resistance. That is, we choose one country, it may have few Russian assets, but it can quickly agree to signing an agreement. We say to other countries: “Look, there is already one such country, let’s someone be second, third.” And then we come to the most influential countries, where the largest amount of funds.
The first country, most likely, will be Latvia. They agreed with the concept. Accordingly, we are now at the stage of negotiations on a specific text of the treaty. I was in Riga last week – they agreed to potentially sign and ratify it in an extremely short time.
After Latvia, I think we will quickly find a few more countries from Eastern Europe that will sign it just as quickly and efficiently. And further in parallel we will push the already large countries of the West, where, in fact, most of the assets are located.
– And when will we start taking the funds and assets of Russians frozen in Ukraine?
– The process is also not easy, but it is also underway. And there are several key factors to take into account. The first factor is that these funds or assets are incommensurable with what is in the West. In addition, the assets of Russians who are in Ukraine are more likely not about money, but about real estate or business. And in a war, this business or real estate will not be worth much.
That is, this is not about urgent, immediate support for the state economy, as it can be with gold and foreign exchange reserves in dollars, euros or pounds, which are in bank accounts abroad. Because this story is much longer-playing.
And it is more long-playing because of the second factor. According to the law, which introduced the possibility of seizing Russian assets on the territory of Ukraine, the decision of the National Security and Defense Council, as the first stage of such a recovery, should be made after the law comes into force. Accordingly, since the law came into force on May 24 of this year, we, the Ministry of Justice, can only work on those persons on whom sanctions were imposed after May 24. That is, to collect evidence and run to court with the seizure of assets.
Since May 24, only one decision of the National Security and Defense Council for 35 people has been made so far – this is the top elite of the Russian government. They are under sanctions. But it is obvious that Putin does not have real estate, houses on the territory of Ukraine. So this first stage is unlikely to be the most efficient from an economic point of view.
At the same time, there are other potential sanctioned persons under consideration by the National Security and Defense Council at the initiative of the government. We expect that such a decision of the National Security and Defense Council will be adopted and an appropriate decree will be issued, where there will be more interesting persons with significant assets on the territory of Ukraine, and sanctions will be imposed on them. This process will move into a real economic dimension, I think, somewhere in August. Next month there will be an appeal to the VAKS (Higher Anti-Corruption Court, – ed.) and, quite likely, the decision of the VAKS itself, if they have time.
Another important aspect under this confiscation. Many lawyers question the possibility of seizure of property for collaborative actions that occurred before May 24 – before the adoption of the law. Conventionally, according to some lawyers, if someone supported Russia before May 24, then it is impossible to seize their property. And if after May 24 – okay, it’s legal, the law is already in force, there is a sanction, such a story is possible.
This is exactly the question that will be legally debated in court. And this is just a question that is fundamentally important for us. Because the volume of collaboration activities that was before May 24 is much larger than that that was after May 24. The most obvious help or support for the aggressor was just in the early days of a full-scale invasion. This is another legal constraint that does not allow launching a large-scale campaign to recover Russian assets in favor of the state today.
Plus, the third factor that needs to be understood is not just Russian assets, and we have taken them away. These are the assets of only the subject who committed one of the collaborationist actions prescribed by law. Accordingly, the court needs to bring evidence that such an act was actually committed by a certain person on a certain date.
This is not a criminal proceeding, but also a lot of bureaucratic work. And it’s underway now. We file a lawsuit, and someone else must provide evidence, because we are not an investigative or law enforcement agency that can collect such evidence. Now interaction with law enforcement officers has been established – BEB ( Economic Security Bureau, – ed. ), SBU, NABU, NACP. They will provide us with evidence and we will go to court with this evidence.
In fact, it is a large, complex, heavy mechanism. And unlike the same gold and foreign exchange reserves, here the economic effect will be delayed in time – given both the nature of Russian assets and the careful procedure for their withdrawal, so that the owners of such assets could then not apply to the ECtHR or arbitration to compensate for the value of the assets.
– I would also like to hook on the bloc regarding the law on oligarchs. Last fall, it was submitted to the Venice Commission for consideration. Is there a conclusion?
– No output. We hope to receive such a conclusion in the fall. Our colleagues do not tell us the exact date.
– How many businessmen, according to the criteria of this law, can potentially be included in the list of oligarchs?
– I have no idea. The situation is now changing dramatically every month. And that approximate idea of the assets and relationships of those individuals who are usually called oligarchs in society has changed significantly with the start of a large-scale invasion – both in terms of the size of assets and their controllability. Plus, individuals have begun to get rid of individual factors or businesses that apparently make them oligarchs.
Accordingly, the situation is rapidly changing. And I don’t have a complete picture in my hands right now about who can get there. Perhaps the National Security and Defense Council has such information, but I can’t answer for sure.
– As far as I understand, Rinat Akhmetov and Vadim Novinsky formally got out of this law. Since the first refused the media, and the second – from the deputy mandate. Do you assume that other possible persons on the list of oligarchs will also look for ways to get out of this law?
Let’s start from the beginning. It is not a fact that someone has left or has not left yet, because there are many criteria for determining an oligarch. The actions of Mr. Novinsky or Mr. Akhmetov obviously fit into the outline of this law – that is, what this law stimulates, they do. This law encourages people to choose either politics or business so that there is no abuse of their position.
The respective persons make some choice. Someone leaves politics, someone gets rid of the media and cuts off their ties with politics. Some people do other things. But it is difficult to say how complete and complete this process is.
The evaluation of each entity that could potentially be included in the register of oligarchs must be carried out carefully. And in each individual case, there are much more signs than a deputy’s mandate. If there remains influence on political decisions through other links to politics, described in the law very clearly, then such a status can be maintained and the loss of a deputy mandate will not be enough.
But we can state that the movement has begun. The movement is active. And the movement, probably, was primarily provoked by the conclusions of the European Commission, which not only confirmed that this instrument has the right to life – the law on oligarchs and their restrictions – but even set its implementation as a condition for starting negotiations on Ukraine’s accession to the European Union.
That is, those who tried to discredit the law on oligarchs, somehow block it, question its constitutionality, lost hope or conviction that this would happen, weighed the risks and realized that the game was not worth it. Plus, let’s add that now the media have become a burden for big business, because the cost is high, and it is not particularly possible to abuse it in wartime, there is little sense. The advertising market has shrunk significantly, and accordingly, the financial burden on content has increased a lot.
All these factors have caused significant shifts in both the political and media markets, which, before a full-scale invasion, would have definitely been the key news of the year, perhaps, and maybe decades. But, obviously, the information background is interrupted now by the war.
– Do the oligarchs in the current conditions have a real influence on the socio-political processes, which was still, for example, before February 24?
– Not. Of course, the impact is much less. It is incomparable with what was before February 24. However, it still remains. Even if you look at how the same TV channels work in the telethon, and even those TV channels that are not in the telethon, you can clearly see the affiliation with one or another owner. Even with an external neutral canvas, the focus on commentators is still different, depending on which channel participates in the telethon. And especially – on those channels that are outside the marathon.
That is, it is still traceable. But the key thing is that the level of influence or attempts to manipulate the minds of citizens is incomparably lower. Accordingly, we can say for sure that the relevance and importance of the law on oligarchs during the hostilities is much less than it was before. However, in the same way, we can say that the relevance of this law will increase after the end of martial law and the end of active hostilities, when the state returns to a peaceful situation, where it will also be necessary to regulate relations or the status of oligarchs.
And again, this is not just about the law. There are so many activities to be done. They are reflected in the relevant government plan for deoligarchization. And we need to work on everything – not only on the implementation of this law.
– Do you think that this law on oligarchs will have to be amended in the near future?
– Undoubtedly. As I already mentioned, the European Commission said that the law should be implemented taking into account the conclusions of the Venice Commission. The Venice Commission has never given an empty opinion on any law that has been submitted to it for evaluation. She always found aspects that could be improved, or facts that seemed to her to be shortcomings. That is, there will definitely be a set of recommendations that can and should be taken into account, including by amending the law. Accordingly, yes, definitely.
– What is the prospect of appealing the ban on pro-Russian parties in Ukraine?
Everything will be decided by the court. The court does not have much time to make an appropriate decision. The law provides one month for the consideration of such an appeal. So we’ll see in August.
– We have heard public information that the HLE does not agree with the decision. What other parties, if you know this information?
– As of today (the conversation took place on July 20 – ed.) , we had information about three appeals. This is the Opposition Platform for Life and two more parties. I don’t remember the names, I’ll look separately and tell you. But these are definitely not major players in the political arena, otherwise I would have remembered the names for sure.
– Are there any safeguards against the fact that in the event of a ban they will simply re-register and continue to work, so to speak, under a new “sign”?
There is a risk, but it is very small. Why is it small? Because it is not easy to create a political party, to put it mildly. Especially in the conditions of hostilities – this further complicates. Previously, political parties were often bought and created to order, and resold. And the texts of the packages of documents that were submitted for registration – on the surface they looked normal, optimal, and the parties were registered.
However, if you dig a little deeper, many of the signatures were simply falsified. Because no one gave themselves unnecessary trouble by actually collecting a huge number of people’s signatures and simply stamped the same documents, signed for many others.
Accordingly, if we approach the creation of a political party with the same carelessness, there is a risk that the party will be terminated upon our appeals to the court instantly, very quickly. And if these same political figures try to create another party, a conditional HLE No. 2, the attention will be great. For sure, law enforcement officers will verify the authenticity of both the signatures and the documents that are set out there.
Accordingly, trying this quick process again – filing something to register a new political party – is extremely unlikely. And to go for a full, honest procedure for creating a really new party, even in the conditions of war, is also a task, to put it mildly, not an easy one. And if this difficult and extremely resourceful task is completed and then again climb into history with some kind of pro-Russian slogans or with something that would somehow shake the sovereignty, territorial integrity of our state, this, again, is a new ban, new criminal production and again a batch from scratch.
Exclusively from such operational moments, the probability of a repeat of pro-Russian activity is now extremely low, because it is just extra hassle and throwing money away with the same result. We will quickly go to court with a new lawsuit if someone continues such stories.
– And what is the perspective regarding international courts and tribunals in the context of Russia’s crimes in the war against Ukraine? What models can be applied here, because I am convinced that Ukrainians have heard about different formats and, perhaps, do not quite understand the difference?
– There are really many formats. Indeed, it will be difficult for a non-specialist to track and understand. The first format is national courts. For example, a Ukrainian court or a court in Poland, Latvia or Lithuania. They can pass judgment on individual war criminals. Courts in Ukraine have already done this several times, sentences have been passed.
Accordingly, this is one of the possible mechanisms: when the accused is brought to court, as a rule, this is a prisoner of war who has committed a war crime, the case is examined against him and a sentence is pronounced. Sometimes, for certain crimes, a sentence can be passed in absentia without bringing the person concerned to court.
The second mechanism, which has not yet been used in practice, is the International Criminal Court in The Hague – the one that is often called the Hague Tribunal in society. It is probably the most authoritative institution, whose powers are much wider than the courts of individual countries, because a huge number of countries recognize its jurisdiction. Accordingly, the decision or arrest that he asks for will be tried by most of the civilized countries of the world.
With regard to Russian war criminals, the International Criminal Court has not yet passed a sentence or a decision on arrest in order to bring the suspect to court.
Processes in this court will continue for decades, most likely. Especially given that there are no statutes of limitations for war crimes. Accordingly, they have an infinite amount of time to review cases. The key obstacle to the International Criminal Court is that the accused must be brought there. In the absence of the accused, he will not pronounce sentences. This is the second important mechanism that has already been created, which works, because the investigators and prosecutors of the International Criminal Court are already working on the territory of Ukraine.
The disadvantage of both the first and second mechanisms is that their effectiveness in relation to the top persons in Russia is low. National courts cannot prosecute Putin, Lavrov or Shoigu because they are protected by immunity. And the International Criminal Court could, but it does not have the capacity to hear cases accusing Russians of the crime of aggression, a crime that is extremely easy to prove for Putin and his entourage.
Accordingly, for the crime that Putin and his inner circle definitely committed – this is aggression, the invasion of Ukraine – it is necessary to create another court that would have the opportunity to consider such a case. This, in fact, is what our Ministry of Foreign Affairs is doing, trying to convince our partners to join an international treaty that provides for the creation of such a separate criminal tribunal that could consider the crimes of top officials of the Russian Federation.
These are three mechanisms that can pass sentences against Russian military personnel or the military-political leadership. All of them have one big drawback – in order for people to go to jail, they must somehow be caught and taken to this prison. And in the situation with the International Criminal Court – and send them to the court so that they sit on the bench there, listen to the case and take part in it.
All the international criminal tribunals that have functioned before have always worked when there was a regime change or when a country lost a war. Accordingly, in case of losing, capturing the capital, seizing the political leadership or changing the regime in the country, when those who are guilty of crimes have lost power, it is enough to simply bring them to court and then put them in jail.
So far, at this stage, this has not been observed in Russia – neither a regime change nor a defeat with the capture of Moscow will happen in the near future either. Accordingly, there is a risk that these sentences or proceedings will hang in the air for some time. At certain first stages, this will be as a factor that will not allow individuals who have received sentences or in respect of whom there are arrests to travel, visit other countries. Well, plus it will be a certain blow to the reputation. But a blow to reputation is not a very significant issue, because the Russians already have no reputation.
Therefore, it will most effectively work after a regime change or Russia’s defeat in the war. Total defeat – not just the withdrawal of troops or the defeat of troops on the territory of Ukraine. These are the key factors preventing justice from winning this war against the brute force that the Russians use.
– What is the fate of Russian prisoners of war in Ukraine? I don’t know if you have the data, how many there are, but what are we going to do with it? We will first condemn them, and then give them for exchange, or not?
There is data, of course. They are kept in our institutions of the Ministry of Justice. I receive daily updates on the status of who is where. Actually, their fate depends on one key thing – whether we have evidence of their war crimes or not.
Accordingly, these are two categories of prisoners of war. Those for whom there is no evidence that they have committed war crimes – they are ordinary prisoners of war under the Geneva Convention, are held until there is a request for the exchange of such persons. By that time, they most often work for us, are engaged in woodworking under protection at sensitive facilities.
As for prisoners of war who have committed war crimes, it is a different story. There are criminal proceedings, investigative actions are being carried out against them to investigate war crimes and pronounce sentences. But they can also be exchanged for our military, who are being held captive by the Russian Federation.
Therefore, by and large, so far the typical fate of both the first and second groups of prisoners of war is to go for an exchange. The difference is that the second group – those who committed war crimes – will receive a sentence that is an obstacle to their further normal life, on the one hand. On the other hand, this category of prisoners is more valuable for the aggressor as a subject of exchange, because the brighter the criminal, the more evil he has done, the greater his significance, the more they want to take him away in order to remove the risks for further accusations. And the more important our heroes we can take away from captivity.
That is, it is a different assessment of different subjects. The more criminals in captivity, the better. Therefore, in fact, we repeat our message to our military: we need prisoners of war, capture, transfer, this is the key, this is a resource for the return of our heroes from Russian captivity.
– Do you have the impression after this story with Canada and the turbine, after certain European companies agreed to pay for gas in rubles, that the sanctions fervor that our foreign partners had at the beginning of a large-scale invasion began to fade? And that European politicians are now more wary of harm to their own national economies?
– No, I do not think so. Just the first steps that they took, like the first or second wave of sanctions, they were obviously agreed upon beforehand. After all, warnings about the possibility of an invasion were several months before the invasion itself began. Therefore, Europeans and Western countries as a whole could agree on such a policy. And it is clear that the first steps are the easiest.
Each subsequent wave of sanctions is a much harder story for the economies of our partners. Naturally, each subsequent wave is given to them more and more difficult. The first waves did not cause much harm to the economies of the same European Union. Not now. Now every next sanction, every next wave is already something like “wow”.
Actually, for us it is more important. Because, as practice has shown, the first wave of sanctions did not inflict any special expenses or blows on the state budget of the Russian Federation. They have large incomes, huge incomes. Revenue from the sale of oil and gas has only increased. Structural problems in the economy have appeared, of course, they are big. But their effect is long-term.
The partners have ardor, it remains. The West fully supports us and would like to help as much as possible. But the corridor in which our partners can operate still exists and is not going anywhere. They also have their own problems. And they also expect an economic crisis as a major player like Russia falls out of supply chains and production. The loss of such a player without certain shock consequences for the economies does not occur. Therefore, everyone prepares as best he can.
– And what do we expect and want to see in the seventh package of sanctions?
– In fact, this is not the focus of my work. The Ministry of Foreign Affairs and the Office of the President are more responsible for sanctions. However, it is obvious that each next wave of sanctions should hit where it hurts the most. And the most painful now seems to be the flow from oil and gas, because something needs to be done about it.
Or limit purchases even more, or set a price cap, or take some other measures so that in the short term Russia will feel the consequences of the sanctions. And not only in the medium and long term, when the lack of access to technology, innovative means of production or devices will limit the competitiveness of their economies. This is a long term trend. In the short term, we need to do something with the money they get from oil and gas.
– Given that you are among the members of the delegation in negotiations with Russia regarding security guarantees for Ukraine, what are their prospects, when can they be resumed and can they be resumed at all?
“There needs to be a clear line here. There are negotiations with Russia. And there are negotiations on security guarantees with our partners and allies from the West. Negotiations with Russia is where I am a member of the negotiating team. They are not currently held, except for a very narrow group and a very narrow topic – the export of grain.
As for negotiations on security guarantees, I do not take part there, so I do not have detailed information. However, it is clear that these negotiations are ongoing and ongoing. And for this, a large group has been created at the Office of the President. What results will be achieved, on what conditions such guarantees will be provided – we should expect information from the Office of the President and the Ministry of Foreign Affairs.
Based on what we saw and understood from the very beginning, these guarantees will probably not be universal for all countries that will join such a regime, most likely. This was communicated by the Office and the Foreign Ministry. But this is an objective reality, because the capabilities of different countries are different, and at least for now, the degree of readiness to defend Ukraine is also different for different states. How it will be formalized, which state occupies which position – this is up to the Office and the Foreign Ministry.
– Let me clarify: if I understood correctly, then the negotiations on the topic of grain are held on the basis of the delegation that participates only one-on-one with Russia? Not for security guarantees?
Yes, it’s not about security guarantees. And not even on the basis of the full group that is negotiating with Russia. This is just a part of this group. Focus on those who cooperate with the UN, with the Armed Forces. By and large, one could even divide the negotiation process into three groups. That is, there are negotiations on grain – short-term, narrow only on a point issue. There are negotiations with Russia about a potential ceasefire or peace – frozen for a certain time and they are not happening. And the negotiations on security guarantees are big, they are being actively conducted with many countries.
– You, if I understand correctly, are part of the delegation of this second so-called ceasefire group.
– Yes. Where we are not yet discussing solely considering that, probably, there are no prospects for concluding such an agreement now. First of all, because of the position of Russia.
– They send signals about their readiness to resume negotiations, but, of course, on their ultimatums?
– Yes, definitely. This is how it sounds in the Russian media all the time: that we are ready, it is the Ukrainians who do not want negotiations. In fact, they are ready to sign an agreement on the terms that they like and that are very similar to some kind of capitulation. Therefore, this is not a readiness for negotiations – this is a readiness to impose their own conditions so that we give up. Somewhere they have such readiness.
When there is a real readiness for real negotiations, such negotiations will certainly resume. But this is a question for the leaders of the negotiating groups, from our side, this is David Arakhamia. He can comment on this history and consequences in the most detailed and competent way. I give only a general impression and my understanding.
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