On 14 January 2025, the Verkhovna Rada registered Draft Law No. 12406 of the President of Ukraine on Amendments to the Criminal Code of Ukraine and the Criminal Procedure Code of Ukraine and the Law of Ukraine “On Sanctions” to establish liability for violation of special economic and other restrictive measures (sanctions).
According to the explanatory note to the draft law, it was developed to ensure legal liability for violation of restrictive measures (sanctions) imposed by the State and deliberate circumvention thereof and to strengthen the effectiveness of the sanctions for the benefit of Ukraine’s national security.
In particular, it is proposed to supplement the Criminal Code of Ukraine with a new Article 1143, which provides for liability for crimes against the foundations of Ukraine’s national security, namely, for violation of a restrictive measure (sanction), as well as intentional circumvention of sanctions. This is a grave crime. Accordingly, quite severe sanctions are proposed:
- Part 1: violation (non-fulfilment, defeating) of the sanction and/or intentional circumvention shall be punishable by a fine of twenty-five thousand to 50 thousand tax-exempt minimum incomes (hereinafter referred to as the TEMI) (which amounts to UAH 425,000-850,000) or imprisonment for a term of 2 to 6 years, with disqualification to hold certain positions or engage in certain activities for a term of 10 to 15 years;
- Part 2: for an act provided for in Part 1 or 2, if committed by an official or a person providing public services, or repeatedly, or in collusion among a group of persons, or in relation to an object of an especially large value, a fine of UAH 75,000-120,000 (which amounts to UAH 1,275,000-2,040,000) shall be imposed on the persons committing the crime, or they shall be imprisoned for a term of 3 to 7 years, with disqualification to hold certain positions or engage in certain activities for a term of 10 to 15 years;
- Part 3: for an act under this paragraph committed by an organised group or an official holding a responsible or particularly responsible position, or in relation to an object of an especially large value, the persons committing the crime shall be punishable by imprisonment for a term of 6 to 10 years, with disqualification to hold certain positions or engage in certain activities for a term of 10 to 15 years and with or without confiscation of property.
The following is also proposed by the draft law:
- a period of limitations for bringing to criminal liability for the crime under Article 1143 of the Criminal Code of Ukraine shall not apply;
- an additional punishment shall be provided for in the form of a ban on the right to hold certain positions or engage in certain activities;
- criminal law measures shall apply to legal entities;
- a special confiscation procedure for the crime committed shall be provided for.
Amendments to the Criminal Procedure Code of Ukraine vest investigative jurisdiction over these crimes in the Security Service of Ukraine.
The draft law also explains the concept and forms of circumvention of sanctions, establishes exceptions, and defines general provisions of international cooperation in the remedial sector.
Thus, if the draft law is adopted and enters into force, businesses will be required to carefully check whether their counterparties, their founders and beneficiaries are on the sanctions lists in order to avoid being involved in future criminal proceedings under the new article of the Criminal Code of Ukraine.
