The issue of compensation for damages caused by the war is extremely relevant for business. Almost from the very beginning of the war, work has been underway to develop and implement effective mechanisms for obtaining appropriate compensation/reimbursement from the Russian Federation.
Given the interest in this issue, our specialists have prepared a series of informational articles for companies with general recommendations on the procedure for realizing compensation for losses caused by the full-scale invasion.
In particular, our previous post was devoted to the peculiarities of filing a lawsuit against the Russian Federation in a national court.
At this time, we would like to familiarize ourselves with the reparations mechanism that is being created within the framework of international cooperation and for the implementation of which there are high expectations. In particular, we will discuss the international Register of Damages.
The decision to establish the Register of Damages Caused by the Aggression of the Russian Federation against Ukraine (Resolutionе CM/RES (2023)3) was made by the Committee of the Council of Ministers of the Council of Europe on May 12, 2023. This event was actually preceded by a year of preparatory work.
The Register of Damages will accept and process applications for compensation for losses and relevant evidence.
According to the Charter of the Register of Damages
- the loss, damage or injury must have been caused:
- February 24, 2022 or later;
- on the territory of Ukraine within its internationally recognized borders, including territorial waters;
- internationally wrongful acts of the Russian Federation in Ukraine or against Ukraine;
- applications to the Register of Damages may be submitted by:
- individuals
- legal entities;
- the state of Ukraine (including its regional and local authorities, state or controlled institutions).
It is important that, along with the application for compensation, the interested party submits relevant evidence to the Register of Losses, which once again proves the need for early and proper determination of the amount of losses and their fixation, such as by a court decision.
It should be noted that the introduction of the Register of Losses is only the first part of the international compensation mechanism.
Of course, the implementation of an international compensation mechanism is a much more complex process than described above, and there is still a long way to go before it becomes operational. Obviously, most of the questions and difficulties have already arisen and will continue to arise regarding the filling of the compensation fund with the assets of the Russian Federation, without which neither the existence of the Register of Losses nor the work of the compensation commission will make any sense.
Summarizing the above, it can be stated that compensation for losses through the use of an international compensation mechanism is promising for business, although this prospect is very long-term. In order to use this mechanism, as well as other alternative ones (international arbitration, a decision of a Ukrainian court recognized in the EU, compensation from the state), which are currently used or may only be used in the future, it is necessary to have sufficient and proper evidence of losses incurred in connection with the armed aggression of the Russian Federation.
For individualized advice on compensation for damages in connection with the armed aggression of the Russian Federation, you can contact our specialists. The Smartsolutions team provides comprehensive support services for the protection of business assets, including the processes of determining the amount of damage caused by a full-scale invasion and the implementation of their compensation.
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