In recent years, cases of pressure being exerted on business entities have become increasingly common in Ukraine, with law enforcement agencies engaging in both abuses—such as the seizure of business property—and inaction regarding the return of such seized property.

Amid the U.S. presidential inauguration and, more broadly, against the backdrop of global political discussions, not everyone may have taken note of Bill No. 12439 dated January 24, 2025.

This bill proposes amendments to the Criminal Procedure Code of Ukraine and is intended to provide greater protection for businesses during criminal proceedings involving them.

It is worth highlighting the most “high-profile” proposed changes, which could effectively turn the system of “seizures” and “prosecutions” of businesses upside down.

1. If a motion to apply a measure to secure criminal proceedings is denied, the investigator, inquiry officer, or prosecutor may not resubmit such a motion to the investigating judge unless new circumstances and evidence not previously considered by the investigating judge are presented.

This is a crucial change, as there are numerous cases in practice where law enforcement agencies, having unlimited authority to repeatedly file motions for arrest, abuse this power.

However, these changes do not eliminate such abuses, as the absence of regulated liability for such actions will not prevent law enforcement agencies from formally “adding new circumstances” or attaching formal “new evidence” to their motions.

2. A copy of the motion to seize property shall be provided to the suspect, the accused, another owner or possessor of the property, or their defense counsel prior to the start of the court proceedings, concurrently with its submission to the investigating judge. This change, in conjunction with the first point, will partially help curb the abuse of repeated filings, as the defense will be able to demonstrate to each new investigating judge the absence of both new evidence and new circumstances.

It is also important that the motion be accompanied by documents confirming the submission or transmission of such a motion. Drawing an analogy with a motion for a pretrial measure or the service of an indictment, the absence of evidence of submission or delivery should obviously result in the motion being returned so that deficiencies in the filing procedure can be remedied.

3. The investigating judge is required to specify in the ruling on the seizure of property the date of its expiration within the time limit provided for by this Code; furthermore, the seizure of property is carried out on the basis of the investigating judge’s ruling, or by a court for a period not exceeding two months and may be extended within the time limit of the pretrial investigation.

Why this is important. Currently, the seizure of property can effectively be indefinite, as the right to file an unlimited number of repeated motions leads to situations where, even after the seizure is lifted, the property owner has not yet actually regained possession of their property because a new motion is already being considered. In addition to the significant duration of seizures, there is also a protracted process in the appellate court, which can last for months due to the failure of the court of first instance to submit materials.

Setting the seizure period at up to two months would require law enforcement agencies, by analogy with the precautionary measure applied to an individual, to demonstrate to the investigating judge every two months the continued existence of risks and the justification for detention, which is also consistent with the practice of the European Court of Human Rights (ECHR), where the need to demonstrate the continued existence of risk over time has been repeatedly emphasized.

4. A suspect, his or her defense counsel, or a representative of a legal entity against which proceedings are being conducted has the right to file a motion to change jurisdiction with a higher-level prosecutor if circumstances confirming a violation of jurisdiction are discovered during the pretrial investigation. A requirement is established regarding the timeframe for consideration and the form of the response to the motion. This allows for an appeal to the investigating judge regarding both the failure to consider the motion and the refusal to grant it.

Cases of abuse regarding jurisdictional authority have occurred and continue to occur. For example, as far back as 2022, the Kyiv City Prosecutor’s Office filed a series of motions to seize the property of 14 legal entities within a single criminal proceeding, all of which were allegedly linked to a single individual.

Ultimately, both under Article 174 of the Criminal Procedure Code of Ukraine and through the appeals process, the seizure of assets against each legal entity was lifted.

After all seizures were lifted, the law enforcement agency transferred the case materials to a separate proceeding and initiated a repeat and unfounded seizure of assets against all 14 legal entities once again. After the motion was denied, another motion to seize similar property was filed, but this time in a third criminal proceeding.

As a result, the prosecutor changed not the criminal proceeding itself, but the jurisdiction, and a seizure was imposed for the fourth time at the initiative of a “new” investigative department and in a different court.

Why this matters. Ukraine’s current Code of Criminal Procedure clearly regulates jurisdictional authority regarding the investigation of specific criminal offenses, but there are frequent cases where security agencies investigate purely commercial offenses or central law enforcement agencies manipulate jurisdictional authority to obtain the right to file motions with various courts (and, accordingly, before various investigating judges).

The right to file a motion regarding violations of jurisdictional rules will ensure that criminal proceedings remain with a single designated law enforcement agency.

I would also note that, as practice shows, law enforcement agencies never follow the lawful procedure for seizing the property of legal entities. Typically, investigators rely on two grounds for seizing property: they classify the property as physical evidence or cite the possibility of confiscating the property as a precautionary measure.

It is worth noting that such property (physical evidence) is never inspected in 90% of cases, and investigators absolutely never define the criteria by which a particular asset qualifies as physical evidence (for example, office premises, land plots, freight rail cars, etc.).

As for the grounds for potential confiscation as a precautionary measure, one sometimes gets the impression that investigators are completely unaware of the existence of Section XIV-1 of the Criminal Code, which clearly specifies the grounds and procedure for applying criminal law measures against legal entities.

Thus, the application of such measures (including potential confiscation as grounds for seizure) against legal entities may only be carried out if information regarding a specific legal entity has been entered into the Unified Register of Pretrial Investigations (by analogy with the inclusion of information about a suspect in the registry), and this is not a mere formality but a requirement governed by the Criminal Procedure Code of Ukraine (Article 214(8) of the Criminal Procedure Code of Ukraine).

Thus, introducing these amendments to the Code of Criminal Procedure of Ukraine will eliminate such abuse, as it will prohibit the filing of repeated motions on similar grounds. Moreover, since the amendments provide for the service of motions on defense attorneys, judges will be made aware of the groundlessness of the seizure, the repetitive nature of the motions, and the filing of motions on similar grounds.

The permanent status of property as “seized” deprives a business of the ability to conduct economic activities and forces it to focus exclusively on defending itself against attacks on the business and constantly proving its legal positions in court—but certainly not on conducting economic activities.

Overall, the bill provides for a number of other amendments to the relevant articles, including provisions on temporary access, physical evidence, and even plans to grant the right to appeal a ruling setting deadlines for reviewing the materials of criminal proceedings, but the most significant changes are those concerning the expansion of defense rights against arbitrary seizure of property, since currently, in order to halt a business’s operations, it is sufficient to provide a brief description of an alleged crime (they even manipulate the situation by citing crimes against the state) and request the seizure of absolutely all property—effectively, use such a seizure to keep the business “on a leash” for purposes that certainly have nothing to do with investigating crimes.

Businesses need protection from criminal prosecution, and such bills must be passed; the country must support businesses during these difficult times.