NBU's impunity: MP criticizes Supreme Court's decision in "Concord" case

The decision of the Supreme Court in the case of "Concord" bank is another confirmation of the unprotected rights of shareholders of banks undergoing liquidation and the permissiveness of the National Bank of Ukraine. This opinion was expressed in an exclusive comment to UNN by Nina Yuzhanina, a member of the VR Committee on Finance, Tax and Customs Policy.

Context

On July 30, the Collegium of the Cassation Administrative Court within the Supreme Court made a decision in the case of "Concord" bank, which lawyers consider biased. They indicate that with its decision, the court effectively deprived the bank's shareholders of access to justice.

Previously, the courts of first and appellate instances recognized as illegal the decision of the National Bank of Ukraine to revoke the license of "Concord" bank and ordered its cancellation. The NBU and the Deposit Guarantee Fund for Individuals disagreed with these decisions and filed a cassation appeal. They demanded the cancellation of the court decisions and the closure of the proceedings.

In paragraph 56 of the resolution, the panel of judges directly stated that no court in Ukraine is empowered to consider lawsuits by shareholders of banks undergoing liquidation regarding unlawful actions or decisions of the National Bank of Ukraine.

"In this resolution, the Cassation Administrative Court within the Supreme Court set forth a legal conclusion that, according to the peculiarities of the legal regulation of the disputed legal relations, the claims of a former shareholder of an insolvent bank (in this case, a liquidated bank) are not subject to consideration either in administrative or commercial proceedings, and by the subjective composition of the participants in the legal relations, they do not fall under the jurisdiction of a civil court. That is, such claims are not subject to consideration by any court," the panel of judges stated.

Thus, the Supreme Court did not even consider the "Concord" case on its merits, but immediately closed the proceedings. That is, the collegium did not evaluate the decisions of the lower courts and did not recognize that they were illegal or unfounded. Olena Sosedka, co-founder of "Concord" bank, considers the court's decision biased, saying that the shareholders were deprived of their constitutional rights.

Details

It seems to me that today, the institutional human rights, the rights of an owner, are mostly violated by the fact that they cannot protect themselves and their rights. Every time I only hear about these situations, when, for example, according to the Criminal Procedure Code, there are nuances that deprive a person of the right to protect their interests and even their property. Therefore, the situation with the inability of the bank's owners, which was essentially confiscated, liquidated on the basis of the National Bank's decisions, is another issue. It seems to me that any such dispute, any such situation should be considered by the courts. Why is it denied and why is it not subject to further appeal in any judicial instance? It seems to me that this cannot be

She noted that in cases where courts in Ukraine refuse to hear cases, shareholders should appeal to the European Court of Human Rights (ECtHR), even though this process is lengthy.

Yuzhanina is convinced that the problem lies in the permissiveness of regulators - the National Bank, to which lawmakers have given the opportunity to independently expand their powers. According to her, there are many by-laws that have greater force for the NBU than the law.

The MP also drew attention to the fact that a similar situation is observed around legislative changes concerning the activities of the Deposit Guarantee Fund for Individuals. In her opinion, the idea of expanding the discretionary powers of banking market regulators under the guise of "flexible rules" has driven the legal system into a dead end, where even the issue of publishing by-laws becomes a stumbling block.

Recall

Despite the war in Ukraine, the process of withdrawing banks from the market has not stopped. Thus, since February 24, 2022, liquidation has been initiated for 8 banks. In 2023, for the first time in Ukraine, not only bankrupt banks but also profitable institutions fell under liquidation and license revocation - this refers to "Concord" bank. As Olena Sosedka, co-founder of the bank, stated, at the time the regulator announced the decision to liquidate the bank, the financial institution had enough highly liquid assets to make all necessary payments within 2-3 weeks. However, the bank liquidation process is strictly regulated by law and can generally last up to three years.