Shortcomings and sometimes explicit imperfection of the legal system of Ukraine makes it possible to use the legitimate mechanisms for illegal expropriation of property and business. In this case, the process of expropriation usually becomes apparent to the owner only at the final stage of this illegal scheme, because the owner rarely pays attention to the procedures and mechanisms aimed at warning and prevention of threat of property and business seizure.
The potential threat of seizure may relate not only to real property (land, real estate) but also corporate rights and intellectual property items. The Trojan horse for the safety of property and business is very often used at the moment of acquisition of such property/business, during business reorganization (introduction of new partners, investors to the business activities), the change of management, etc. A particularly important issue of corporate security is if you want to make foreign investment into Ukraine (Ukrainian company).
It is difficult to understand what are the criteria guided by the raiders, selecting an object for later seizure. One of the key factors during the raider attacks is almost always getting into contact with the “right people”, followed by the further use of “telephone justice” by the individuals assisting the raiders. However, the use of contacts and pressure by the raiders could be nullified with right legal protection and the raiders will look for a less prepared company.
The specific nature of doing business by a non-resident in the country-recipient of foreign investment is difficulty with the operability and overall control over the situation. The entire control of the business opening with the foreign investments in Ukraine is often simmered down to grant power of attorney by the investor-non-resident to a trusted person who is either a hired director or a Ukrainian partner of a non-resident. In most cases these individuals are the real threat of illegal seizure of investment, and shortcomings and sometimes obvious imperfection of the legal system of Ukraine are the “helpers” in the act of seizure.
In most cases, the process of expropriation of property/ business/
foreign investments into Ukraine
often becomes obvious to a non-resident investor at the final stage of realization of this illegal scheme. The mechanisms used for such expropriation of property may be various, but the most popular among the raiders are a few of proven schemes, such as liquidation of an enterprise with a foreign investor and selling of assets at discounted prices to the entities affiliated to the raiders in the process of liquidation, or “loss” of cases at law by the structures affiliated to the raiders, followed by alienation of liquid assets of an existing business during the execution of the decisions of such cases at law.
The practice shows that the problems for security of property and business of a non-resident investor appear at the moment of acquisition of such property/business, business reorganization (introduction of new partners, investors to the business activities), the change of management, etc..
It will be obvious to say that most of qualified lawyers who specialize in the protection of foreign investments, are located in Kiev. It does not matter exactly where the object is located in Ukraine, even in another region. Our company provides a range of services aimed at effective audit of corporate safety and security of investments of non-residents, development of effective methods and tools for investment protection, prevention of seizure of non-resident property and business, prevention of violations of the rights of owners /members /shareholders of companies. You can always contact us for practical advice in protecting your rights and investments in Ukraine.