Business welcomes the decision to withdraw the draft law on the mechanism of protection of third-party property rights
On August 12 , the author of the initiative decided to withdraw the draft law on the mechanism for protecting third-party property rights No. 11195.
Thus, several months ago, given the threats to the constitutional principles of property rights, the potential destruction of the investment climate, and the possible deterioration of the economic situation associated with the consideration of Draft Law #11195, the business community strongly criticized this document and urged MPs not to support it.
The European Business Association welcomes this decision and is grateful to the author of the draft law, David Arakhamia, for making the voice of business heard!
At the same time, the business community thanks the Ministry of Justice, Chairman of the Verkhovna Rada Committee on Economic Development Dmytro Natalusa and his colleagues for their leadership in bringing together a wide range of stakeholders on the basis of the Verkhovna Rada Committee on Economic Development to develop a completely new document that, on the one hand, will allow the state to implement the sanctions policy, and, on the other hand, will not lead to a deterioration in the investment climate and will not scare investors away from Ukraine.
Adherence to the principles of exclusively judicial asset recovery, continuity of ownership of assets by non-sanctioned persons, individual responsibility of sanctioned persons, inviolability of the rights of non-sanctioned persons to participate in management and profit are the key postulates on which future legislation should be based, and we sincerely believe that together we will be able to develop a truly high-quality regulation that will meet the highest international standards.
As a reminder, Draft Law No. 11195 proposed to empower public authorities to decide on the foreclosure of 100% of a block of shares or other securities directly owned by a legal entity in whose ownership structure a person subject to an asset freeze has been sanctioned, if the determined amount of participation in such a block of shares of the person subject to an asset freeze is less than 25%.
If the sanctioned person owns 25% or more of the shares, the alienation will be carried out by filing a corresponding application with the court. The Draft Law does not provide for any transparent and quick mechanism for restoring the ownership rights of all other non-sanctioned shareholders.
It is also worth noting that all shareholders, including non-sanctioned persons, were deprived of the right to participate in and manage the legal entity, which would almost certainly lead to a business shutdown.
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