UKRAINE Trends and Developments Contributed by: Denys Bugay, Volodymyr Vashchenko, Denys Shkarovsky and Oleksandr Lukianenko, VB Partners
as the Asset Recovery and Management Agency, or ARMA) is one of the key institutions in the develop - ment of white-collar crime practice in Ukraine. ARMA was established in 2016 as part of the anti-cor - ruption reform programme, which itself formed part of Ukraine’s commitments to the European Union. The Agency’s principal functions are as follows. • Detection and tracing of assets obtained from crime, in particular corruption – to this end, ARMA co-operates with law enforcement authorities (NABU, the State Bureau of Investigation, the General Prosecutor’s Office, among others) and with international networks to locate assets both in Ukraine and abroad. • Management of seized assets – once property is seized in criminal proceedings, ARMA transfers it into the management of specially selected admin - istrators (either public or private). The objective is not only to preserve the value of such assets but also to generate revenue for the state budget. ARMA’s performance has faced criticism, particularly due to the low effectiveness of its asset management in certain cases and the presence of corruption risks. This created a demand for ARMA’s reform, with the aim of ensuring transparency in its operations and strengthening its powers in asset management. The Verkhovna Rada of Ukraine adopted a Law to this effect, which provides the following. • A mandatory independent audit of the Agency’s activities shall be introduced, together with trans - parent procedures for selecting asset managers through open competitions. This is intended to minimise corruption risks and enhance confidence in asset management. • The requirements for the head of ARMA shall be strengthened, and the competitive selection pro - cess shall involve international experts. • Mechanisms for the management of virtual assets (cryptocurrencies) shall be introduced. This rep - resents an important step, given the increasingly frequent use of virtual assets in money laundering schemes.
• Managers of shares in a company’s authorised capital are no longer required to co-ordinate their actions with the owners, provided that the owner is the Russian Federation or one of its residents. Previously, managers were obliged to obtain such consent from the shareholder in all cases, which significantly obstructed the management of assets belonging to Russian residents. Thus, ARMA’s scope of activity is set to expand further – from more effective management of corporate rights to the administration of virtual assets (cryptocurren - cies), which was previously impossible or significantly hindered. Criminalisation of sanctions evasion The sanctions regime has existed in Ukraine since 2014, following the adoption of the Law of Ukraine “On Sanctions”. However, Ukrainian legislation currently does not pro - vide for legal liability for breaches of sanctions. This poses a significant problem, given Ukraine’s active role in imposing sanctions in the context of armed aggression. A key step towards the criminalisation of sanctions violations and evasion in Ukraine was the adoption by the European Union in April 2024 of Directive No 2024/1226, which defined acts constituting breaches of EU sanctions as criminal offences and set out the corresponding penalties. At the beginning of 2025, the President of Ukraine submitted to Parliament a draft law establishing liabil - ity for violations of special economic and other restric - tive measures (sanctions). This draft law has already passed its first reading in the Verkhovna Rada and is expected to be adopted in early Autumn 2025. The key provisions of the draft law are as follows. • The introduction of criminal liability for the deliber - ate breach or evasion of sanctions, punishable by penalties ranging from fines to imprisonment. Acts constituting sanctions evasion will be defined in the Law of Ukraine “On Sanctions” and will include
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