Zelensky signed a law allowing investigators and prosecutors to restrict business operations if they believe the business could interfere with an investigation.

The President of Ukraine Volodymyr Zelensky has signed a law amending the Criminal Code of Ukraine, the Criminal Procedure Code of Ukraine, and other legislative acts of Ukraine aimed at enhancing mechanisms for holding legal entities accountable for bribing foreign officials — bill 11443.

As previously reported by the “Judicial-Legal Newspaper,” this bill grants investigators and prosecutors broad discretion regarding the restriction of business activities.

Thus, the Criminal Procedure Code has been supplemented with a new article 483-5, which establishes that a legal entity may be subject to a measure of securing criminal proceedings, such as restrictions.

Such restrictions on activities may be applied if the investigator or prosecutor has “sufficient grounds to believe” that actions may be taken in the interests of the legal entity that would “hinder criminal proceedings.” In other words, a sufficiently vague concept has been introduced that investigators and prosecutors can use at their discretion.

The amendments propose to establish that “if there are sufficient grounds to believe that actions may be taken on behalf of the legal entity and/or in its interests aimed at avoiding the application of criminal-legal measures and/or otherwise obstructing criminal proceedings, the investigator, in agreement with the prosecutor, will apply to the investigative judge or court for the imposition of restrictions on the legal entity, which may be subject to criminal-legal measures.”

“It should be noted that the wording ‘if there are sufficient grounds to believe’ is quite subjective and evaluative. In cases of abuse by an investigator or prosecutor of their procedural rights, this provision may be used for covert pressure on businesses,” the GNEU of the Verkhovna Rada pointed out.

It is also proposed that, again referencing “sufficient grounds to believe,” the investigator or prosecutor may consider cases without summoning a representative of the legal entity.

Thus, in Article 483-7 of the Criminal Procedure Code, as revised by the bill, it is defined: “If the prosecutor or investigator proves the existence of sufficient grounds to believe that there is a real threat of changing the constituent documents of the legal entity, its termination, or the disposal of assets that would hinder their further recovery, the petition may be considered by the investigative judge or court without summoning a representative of the legal entity.”

Additionally, it is proposed in Article 483-7 of the Criminal Procedure Code to regulate that the petition for the imposition of restrictions on the legal entity is considered by the investigative judge (court) no later than three days from the date it is received by the court in the presence of the prosecutor and/or investigator. In the absence of the legal entity's representative without valid reasons, the petition may be considered in their absence.

“However, in such a case, the legal entity's right to legal assistance will not be ensured,” the GNEU emphasizes.

The investigative judge is also granted the opportunity to hear any witness or examine any materials relevant to the decision on the application of restrictions concerning the legal entity without summoning a representative of the legal entity.

Clearly, such changes may pose risks of covert pressure on businesses from law enforcement agencies, and no safeguards are provided in the bill to mitigate this risk.

Among other things, according to the amendments to part 2 of Article 96-1 of the Criminal Code, special confiscation will also be applied based on a court ruling on the application of criminal-legal measures to the legal entity.

Recall that earlier the Ukrainian Union of Industrialists and Entrepreneurs (USPP) commented on the “Judicial-Legal Newspaper” regarding this bill.