June 18, 2025

The Asset Recovery and Management Agency (ARMA) announces the completion of the legislative reform process for its operations.

Draft Law No. 12374-d went through a complex adoption process — five public discussions, 920 proposed amendments, and initial negative feedback from certain government bodies. However, the most critical comments and proposals raised during the five public consultations organized by ARMA — and officially submitted or voiced publicly — were taken into account in the final version of the law and reflected in the second reading amendments.

What Was Not Included in the Adopted Law

• New management mechanisms, such as engaging private enforcement officers or insolvency trustees, were excluded. The criticized proposal to select asset managers via an automated “roulette” system was also rejected. As a result, ARMA’s proven and functional Prozorro-based competitive selection system will continue to operate.
• The law does not contain restrictions on the NACP’s ability to verify declarations, nor other unconstitutional provisions that could threaten Ukraine’s anti-corruption framework. This prevents attempts to undermine the anti-corruption system under the pretext of “EU requirements”.
• There are no provisions obliging prosecutors to assess assets, preserving the legal balance between ARMA and law enforcement, and avoiding violations of the Law on the Prosecutor's Office and the Criminal Procedure Code.
• A provision allowing asset owners to pay for continued use of their seized property was rejected, preventing corruption risks and upholding legal consequences within criminal proceedings.
• The proposal requiring prosecutors to conduct asset inventories and sign related documents within short timeframes was also rejected. ARMA and the Prosecutor General’s Office have already conducted such inventories, and the volume of assets makes such timelines unrealistic.

 What Was Incorporated Based on ARMA’s Proposals

The most critical comments and suggestions made during five public discussions organized by ARMA, which were submitted and announced publicly, were taken into account in the final version of the draft law and officially incorporated, and were also reflected in the amendments to the second reading. So, what was taken into account from ARMA's comments:

• Unblocking of Article 13 of the special law — previously a source of systemic corruption and operational paralysis since 2019.
• Unblocking of management over Russian-owned corporate rights — a change ARMA has advocated for nearly two years to prevent requiring the aggressor state’s approval.
• Strengthening ARMA’s institutional capacity, including the procedures for selecting the Head of the Agency, appointing deputies, and conducting external audits — areas previously unregulated.
• Legal confirmation of ARMA’s ability to manage funds and purchase government bonds (OVDPs) in the post-war recovery period.
• Expanded powers to preserve assets and enhanced authority in asset tracing, including automated registry access.
• The Agency retains its centralized monitoring and control functions, with no unnecessary decentralization to regions.
• Legal foundation for managing cryptocurrency: ARMA will be authorized to hold virtual asset wallets and accounts on crypto trading platforms for the purpose of managing and selling such assets.
• Strengthened public oversight, including the creation of an independent Public Oversight Council and an Internal Control Department to detect, prevent, and investigate violations within the agency.
• Unhindered access for ARMA personnel to assets under its management or assets under seizure and finding.

Transparency Mechanisms Preserved

ARMA’s effective systems via Prozorro and Prozorro.Sale remain intact. The competitive selection of managers and public sale of assets initiated by ARMA will continue in full force.

Remaining Challenges

Further amendments to the Criminal Procedure Code and the Law on the Prosecutor’s Office are still necessary. Without these changes, certain mechanisms cannot function effectively — as confirmed by law enforcement assessments. Until then, ARMA will continue to address these challenges through daily proactive cooperation with relevant authorities.

Reform Provides Legal Foundation for Innovation

The reform legally enshrines the innovative approaches ARMA has introduced in recent years: e-auctions, transparent manager selection, and detailed transaction reporting now have a strong legislative basis.

The reform paves the way for the development of digital tools in asset management and enhanced operational efficiency.

“This means that the reform we launched is now officially embedded in Ukrainian legislation and has a strong legal basis for effective functioning. The transparency of ARMA’s procedures has become a core part of the legal framework, laying the foundation for further development and improvement of Ukraine’s asset management system,” — stated ARMA Head Olena Duma.

The reform will allow ARMA to work even more efficiently, ensuring maximum transparency and competitive selection of the best managers. This is a significant step toward building public trust in the agency and increasing returns to the state budget.

We continue working!