The Russian occupation of Ukraine’s Crimean peninsula has created a wide range of complex legal issues, ranging from human rights and international jurisdiction to trade relations and property ownership. Since the Russian annexation process began about eighteen months ago, much international media attention has focused on violations of basic human rights and freedoms – particularly in relation to the peninsula’s indigenous Crimean Tatar population which overwhelmingly opposed the Russian invasion and has hence become the target of abductions, entry bans, freedom of assembly restrictions and a media crackdown.
The efforts of the occupation authorities to nationalize Ukrainian state-owned and private assets in Crimea also created an entirely new area of legal confrontation as owners seek to assert their property rights in a climate of geopolitical confrontation and complete Russian disregard for international law. The Ukrainian state has estimated that it has suffered losses valued at tens of billions of dollars as a direct result of Moscow’s annexation of Crimea. Nonetheless, legal proceedings over compensation are likely to take many years to be resolved. Meanwhile, private individuals face an environment of legal ambiguity and uncertainty as they seek to safeguard their property rights from occupation authorities operating with apparent impunity.
Ukrainian property owners dispossessed
The nationalization initiative was initially justified by the so-called Council of the Republic of Crimea as a measure to return assets ‘illegally acquired’ by the Ukrainian state. Additional arguments to support the nationalization drive have included the alleged need to secure objects regarded as strategically important to the Crimean economy, and a quite obvious desire to prevent owners loyal to the Ukrainian government from using Crimean resources to help finance Ukraine’s national defense efforts in eastern Ukraine.
The list of seized or compulsorily redeemed objects in Crimea had included those of Privat Bank (associated with former Dnipropetrovsk Oblast Governor and prominent Ukrainian oligarch Ihor Kolomoyskiy), Aivazovskiy Park complex (associated with another Ukrainian oligarch Serhiy Taruta), energy company Krymenergo and the Crimean branch of Ukraine’s national fixed line telephone operator Ukrtelecom (both associated with ‘Ukraine’s richest man’ Rinat Akhmetov).
The Crimean occupation authorities went to some lengths to stress the finality of this controversial nationalization process, in particular with the peninsula’s high-profile Moscow-appointed chief prosecutor Nataliya Polkonskaya calling the nationalization ‘non-challengeable’. However, leaving aside the issue of the legally unrecognized status of the Russian occupation in general, even the Russian courts seem to be undecided about the legality of Crimea’s nationalization drive.
Russian Supreme Court leaves issue unresolved
While complaints for annulment of the nationalization from the Ukrainian authorities and individual Ukrainians have not been lodged due to legislatively established absence of legal authority of Russian-based court authorities in Crimea, there have been a number of legal challenges to the nationalization process from Russian sources. Well-known Crimean lawyer and activist Jean Zapruta and Russia’s Yabloko political party have both disputed the legality of the nationalization programme by lodging complaints with a local court of appeal at Simferopol. Mr. Zapruta’s complaint was eventually rejected by the Russian Supreme Court in a final ruling that was held up by many in the international media as confirmation of official Russian state backing for the nationalization process in occupied Crimea.
However, closer inspection of the Russian Supreme Court ruling of April 2015 reveals a more restrained picture that remains open to a variety of interpretations. Russia’s top court ruled that Mr. Zapruta had not possessed any legitimate interests or rights regarding the privatization issue, and therefore had not been legally empowered to act on behalf of those affected by the nationalization. As a result, the case was closed without the court passing judgment on its merits. The Russian Supreme Court employed similar arguments - and reached similar conclusions - during a subsequent hearing in May 2015 addressing the complaints lodged by Yabloko political party.
Far from confirming the legality of the process, the Russian Supreme Court neither supported nor opposed the Crimean nationalization drive, leaving the question of Moscow’s official stance open. While those who have lost property as a direct result of the nationalization process theoretically enjoy the right to challenge these acts of nationalization in the Russian courts, the situation remains shrouded in mystery. As long as this uncertainty remains, members of the media and legal professionals should beware of jumping to conclusions or attributing undue importance to rumors – unless they wish to become part of the rumor mill themselves.