Enhanced legal clarity of the procedure intended for the protection of the rights and interests of Ukraine and the representation of Ukraine in disputes with foreign entities is a long-awaited achievement for the international legal community.
It is no secret that Ukraine is continuously involved in at least two dozen disputes referred to different jurisdictional bodies including the ICSID, Washington DC, and the Stockholm Arbitration Institute. Claimants in such proceedings are primarily foreign investors or other entities believing that they possess such status.
In this context, it is highly important to understand which public authority is duly empowered to, and on which basis it may, for example, instruct any legal advisers to represent the interests of Ukraine, and do any other acts to protect the interests of the state before an international jurisdictional body.
The major achievement of the new policy is that the Ministry of Justice is now solely responsible for the entire process, while the previously applicable law vested that function with an ambiguous ‘authorised body’.
It means that it has put an end to the conflicting situation where one dispute was the business of five ministries, which adversely affected the representation of Ukraine’s interests as too many cooks would definitely spoil the broth.
Some of the most important changes:
1. It is made clear which central public authority shall be responsible for representing the interests of the state, which is the Ministry of Justice of Ukraine. Other public authorities (e.g., as it is often the case, sector ministries) play a supporting role in such matters. Therefore, the problem with a ‘responsible authority’ has been solved.
2. It is only the Minister of Justice or his/her Deputy Minister who may head an interagency working group. Previously, it could be headed by any government minister in charge of the relevant sector.
3. There is a single body authorized to supervise such matters, which is now the Cabinet of Ministers. It shall be kept updated on a monthly basis as to any developments in the matters.
4. According to the new procedure, legal advisers and any external advisers of other categories will be appointed by the Ministry of Justice of Ukraine.
However positive is this new Procedure one important issue is left aside, namely, which governmental Authority appoints external counsel to represent numerous state companies which become party to foreign court and arbitration proceedings even more often?
Needless to say, that the procedure itself unfortunately lacks transparency which is expected by international legal community.
Andrey Astapov is Managing Partner and Head of Dispute Resolution Practice at AstapovLawyers. Andrey graduated from University of Mississippi (USA), University of Nottingham (UK) and Zaporizhzhya National University (Ukraine).
