Anti-raid protection: how to protect business and recover assets

 

Raiding remains a serious threat to Ukrainian entrepreneurs, so effective anti-raid protection requires an immediate and legally competent response.

If you notice attempts of illegal change of ownership in the registers or physical blocking of the enterprise, delay can cost you assets. In this article, we will analyze a step-by-step algorithm of actions: where to file a complaint and how to stop registration actions.

Ways to appeal registrar actions: administrative vs judicial

There are two main ways to appeal decisions, actions, or omissions of state registrars:

1. Administrative — filing a complaint with the Ministry of Justice of Ukraine or its territorial body.
2. Judicial — filing a lawsuit directly to the court.

It is important to remember the time limits. If you learned about a violation of your rights and more than 60 days have passed, administrative appeal becomes impossible — protection of rights is carried out exclusively in court.

Choosing court jurisdiction: new Supreme Court rules

If administrative appeal tools cannot be applied, it is necessary to choose the correct method of protection. First of all, it is necessary to determine which court jurisdiction to apply to, based on the current practice of the Supreme Court.

Previously, property owners often applied to administrative courts, but judicial practice has significantly changed. A key moment was the resolution of the Grand Chamber of the Supreme Court of October 2, 2019, in case No. 807/137/18.

“The mere cancellation of the state registration of a right belonging to one person, at the request of another person, does not allow to finally resolve the dispute about the right between these persons without clarifying the legality of the legal grounds for acquiring such property…”

The Supreme Court has actually changed the approach: now the emphasis has shifted from the registrar’s actions to the legal grounds for registration of the right of ownership or use of property.

When to apply to the administrative court?

If the plaintiff appeals the registrar’s actions in the context of Article 24 of the Law of Ukraine “On State Registration of Rights to Real Estate and Their Encumbrances” (e.g., unreasonable refusal of registration), and this dispute does not concern the rights of third parties — the case is a public law matter.

In this case, a lawsuit is filed with the district administrative court at the plaintiff’s choice:

• at the registered place of residence/location of the person;
• or at the location of the defendant.

Civil and commercial jurisdiction: dispute over rights

In the case where the registrar’s actions are appealed at the request of a third party, a dispute over rights arises between the plaintiff and another person. Jurisdiction depends on the parties involved:

• Civil court: if at least one of the parties is an individual (appeal to the local general court).
• Commercial court: if the parties are business entities (legal entities and individual entrepreneurs).

Who is the proper defendant in raiding cases?

When preparing a lawsuit, pay attention to a critical nuance: the proper defendant in such disputes is the person whose property right is being contested and regarding whom an entry has been made in the Register.

The state registrar can only be involved as a co-defendant, which does not change the private law nature of the dispute. The request to cancel the registration in this case is stated as derivative from the main claim for recognition of the right.

---

About the author:

Denys Fedorkin — Managing Partner of the Law Business Association (LBA) law firm. Lawyer with 17 years of experience in business protection, expert in tax law and anti-raid activities. Specializes in comprehensive support of real estate transactions and protection of property rights.

Need urgent consultation on protecting your assets? Contact the professionals:

Get legal assistance