The Ukrainian National Bar Association hosted an open discussion of legislativeamendments to reform ARMA as part of the Ukraine Facility Plan. The event wasattended by representatives of government and law enforcement agencies, businessassociations, scholars, MPs, members of the relevant committee of the VerkhovnaRada of Ukraine, attorneys, representatives of Prozorro and Prozorro.Sale, insolvency managers and private enforcement officers.

Head of ARMA Olena Duma presented her vision of strengthening the institutionalcapacity of the National Agency. According to her, since the second half of 2023, ARMA has already begun its transformation, including the opening of the SeizedAssets Register and the introduction of new transparent rules for the sale throughProzorro.Sale and the selection of managers. During the year, 12 draft laws wereinitiated, including proposals to unblock the management of corporate rights andsell sanctioned assets that had been seized and duplicated in criminal proceedings.

The participants of the discussion drew attention to the significant shortcomings ofDraft Law No. 12374-D in its current form. In particular, the proposal to train andcertify insolvency managers by the National Agency itself, which is not a scientificinstitution. The proposed mechanism of automatic selection of managers through‘roulette’ also calls into doubt the effectiveness of managing specific assets.

The insolvency managers stressed the need to fully unblock the management ofcorporate rights, as repeatedly emphasised by the National Agency andrecommended by the Accounting Chamber. Without these changes, the insolvencymanagers do not see themselves participating in the management of seizedproperty.

The National Bar Association of Ukraine was particularly concerned about theissue of legal liability of insolvency managers. In the absence of adequate funding, support and access to criminal proceedings materials, there are risks of corruption. The only sanction for violations is the revocation of the certificate. Therefore, there was a proposal to amend the draft law on the declaration of insolvencymanagers.

“We need to create a document that will actually work and ensure efficiency andtransparency not only for the authority, but for Ukraine as a whole. We cannotextend any provisions of the law just because there is an approved plan. We needto think about what laws we propose to adopt today and in whose interests this lawwill work,” emphasised Olena Duma.

ARMA proposes to improve the existing mechanisms, in particular:

- implement mandatory pre-seizure planning

- improve cooperation with prosecutors and pre-trial investigation authorities

- unblock the management of corporate rights

- set clear deadlines for procedures

According to the Head of ARMA, the results of the agency's transformation arealready recognised by international partners, and the proposed changes havealready been discussed with members of the European Commission. Furtherelaboration of legislative amendments is expected with the involvement of allstakeholders and taking into account the position of international partners.