Seizure of State-Owned and Private Property in International Law: Mapping the Applicable Legal Rules and Identifying Conditions that Frame and Limit the Seizure of Frozen Assets in the Context of the Situation in Ukraine

TITLE: Seizure of State-Owned and Private Property in International Law: Mapping the Applicable Legal Rules and Identifying Conditions that Frame and Limit the Seizure of Frozen Assets in the Context of the Situation in Ukraine

PROJECT CODE: Z5-50167

PROJECT MANAGER: doc. dr. Maruša Tekavčič Veber

COORDINATOR: 583 - University of Ljubljana, Faculty of Law

DURATION OF THE PROJECT: 1. 11. 2023 - 31. 10. 2025

PROJECT TEAM COMPOSITION:

583 - University of Ljubljana, Faculty of Law:

• 37846 - dr. Maruša Tekavčič Veber

SCOPE OF FUNDING: 1700 research hours in price category B for a period of 2 years (1,00 FTE)

FINANCERS:

The war in Ukraine has led to the adoption of extensive sanctions against Russia, aimed at ensuring Russia's compliance with its international legal obligations. The scope of the sanctions adopted, in particular the freezing of state and private assets, is unprecedented in history, with the total value of frozen Russian assets worldwide already exceeding USD 300 billion. In addition, the European Union (EU) and some countries (e.g., the United States (US)) have announced the possibility of seizing frozen Russian assets to secure funds for Ukraine's reconstruction. In the US, the first procedures for seizing private property for the reconstruction of Ukraine have already been carried out. On the other hand, some countries, such as Switzerland, are much more cautious about seizing assets, as this could conflict with their national and international obligations. At the EU level, various proposals have been made in recent months regarding a possible legal framework for asset seizures, and special groups have been set up to examine options that would enable the EU to seize Russian assets for Ukraine's reconstruction. The seizure of frozen Russian assets raises several legal issues, particularly the concern that any unlawful seizure could lead to extensive compensation claims by states and individuals, further destabilizing international relations.

The purpose of the research project is to examine international legal issues arising from the seizure of property by defining the various international legal rules governing this area and subsequently clarifying the conditions for lawful seizure.

Based on the distinction between the seizure of state and private property, the proposed research project pursues the following three objectives:

1) To define and analyze the rules of international law governing the seizure of state property and to clarify the conditions that must be met for the lawful seizure of property under these rules

2) Defining and analyzing the rules of international law governing the seizure of private property and clarifying the conditions that must be met for the lawful seizure of property under these rules

3) Analysis of the proposed EU regulation on the seizure of frozen Russian assets. The proposed research project is structured around these three objectives.

Phase 1 – Seizure of State Assets:

• Objective: to identify and analyze the rules of international law governing the seizure of State assets and to clarify the conditions that must be met for the lawful seizure of assets under these rules.
• Activities: analysis of two sets of legal rules: 1) rules on state immunities, with a particular focus on the analysis of exceptions to immunity from enforcement that allow for the seizure of state property, and 2) rules on state responsibility, in particular analysis of provisions on the obligation to provide reparations by states responsible for internationally wrongful acts and rules on countermeasures.

Phase 2 – Seizure of private property:

• Objective: to identify and analyze the rules of international law governing the seizure of private property and to clarify the conditions that must be met for the lawful seizure of property under these rules.
• Activities: legal analysis of the seizure of private property from the perspective of three sets of legal rules: 1) international investment law, with an emphasis on the conditions for lawful expropriation; 2) international human rights law and the conditions for the lawful seizure of property from individuals by the state; 3) seizure of property gains obtained through criminal activity.

Phase 3 – Analysis of the proposed EU regime for the seizure of Russian assets:

• Objective: to analyze the proposed EU regime for the seizure of frozen Russian assets.
• Activities: clarification of how the relevant rules analyzed in the previous phases bind the EU and/or its Member States; critical analysis of the proposed EU mechanisms for the seizure of Russian assets with a view to securing funds for the reconstruction of Ukraine; concrete proposals for the future legal regulation of this area.

Phase 4 (non-substantive) – project management and dissemination of results:

• Activities: project management and dissemination and dissemination of project results.

Ljubljana – Olomouc Workshop: National Implementation of EU Sanctions (Restrictive Measures) concerning the Situation in Ukraine: Legal and Practical Challenges, 8. March 2024, Faculty of Law, University of Ljubljana