Owning assets in temporarily occupied territories is not yet a crime. However, any interaction with them, even passive, can lead to criminal proceedings, confiscation of property, and imprisonment. Lawyers warn that Article 111-1 of the Criminal Code on collaborative activities is one of the most dangerous for businesses and affects even those acting without malicious intent. Svyatoslav Bolinskyi, CEO of the law firm "Bolinskyi and Team," stated this in a comment to UNN.
According to him, Article 111-1 of the Criminal Code of Ukraine was adopted in March 2022—quickly and without sufficient refinement. This has led to legal conflicts that investigators are now actively exploiting.
The norms are drafted in such a way that anyone can fall under the scope of Article 111-1. If you are a holder of corporate rights, you should think twice and be cautious, as any behavior can be interpreted as active
Owners of companies, top management, and even rank-and-file employees who communicate with colleagues in occupied territories online are at risk. Ulyana Varyshko, a lawyer at the firm, explains that sometimes correspondence in messaging apps is enough to initiate criminal proceedings.
Consider a situation: a person has a business in Crimea or in eastern Ukraine. In practice, they cannot take any action regarding it from government-controlled territory—neither close nor re-register the company. And although the person does not cooperate with the aggressor's authorities, the investigation can use their correspondence in messengers as a tool of pressure
Among the riskiest actions, lawyers list: managing an enterprise in the TOT (temporarily occupied territories), paying taxes to occupation administrations, paying salaries in rubles, re-registering a company according to the occupiers' requirements, as well as any contracts with structures controlled by the occupiers. At the same time, even paying utility bills can be interpreted as voluntary support for the aggressor.
Punishment under Article 111-1 of the Criminal Code of Ukraine ranges from fines to 12 years of imprisonment and confiscation of property. During the investigation period, corporate rights may be transferred to ARMA (Asset Recovery and Management Agency).
Varyshko also warns against hasty decisions under pressure from the investigation.
Signing a plea agreement means full confirmation of the circumstances set forth in it and has significant legal consequences that are extremely difficult to change or appeal in the future
Bolinskyi advises business owners in the TOT to follow a single rule—completely avoid any interaction with assets in the occupied territories, including correspondence regarding economic activities.
For a certain period, it is worth forgetting about the existence of property and other assets in the TOT altogether and refraining from any actions—even in the event of a threat of their 'nationalization' by the occupiers"
According to the lawyer's forecast, Article 111-1 of the Criminal Code will be decriminalized after the war ends. But for now, it remains one of the main legal risks for Ukrainian business.