Published on 9 October 2023

FOURTH SECTION

Application no. 29497/18 CHERNOMOR INVEST, TOV against Russia and 3 other applications (see list appended) communicated on 6 September 2023

SUBJECT MATTER OF THE CASE

The applications originate from the conflict between Ukraine and the Russian Federation. They concern property rights to real estate located in various parts of Crimea.

In applications nos. 29497/18 and 52884/18 the applicant companies purchased, in 2006 and 2007 respectively, buildings and/or land plots from their previous owners who had earlier privatised them from public domain. The legality of the applicant companies’ titles then was subject to judicial review; they were eventually confirmed by final decisions of Ukrainian courts in 2014 and 2008, respectively.

In applications nos. 34345/20 and 35438/20 Ukrainian authorities in 1995 ‑ 1998 allocated to the applicant company, a collective farm, and its predecessor a land plot for permanent use with hydraulic facilities located therein and granted it the right of collective ownership of another land plot. According to the applicant company, between 1998 and 2008, it allocated parts of the collectively owned land to its members who left it. In 2008 a third-party organisation sued the applicant company and claimed title to its land for an outstanding debt. After the judgment of the first instance court the applicant company’s title was transferred to that organisation, which then allegedly alienated it to a foreign company. In 2009 this judgment was quashed by final decisions of Ukrainian courts, although, as appears from the documents in the case file, this did not lead to a full restoration of the applicant company’s title.

When the Russian Federation asserted its jurisdiction over Crimea in 2014 all public property that had been nominally owned by the Ukrainian state, regional, and local authorities was declared to constitute property of the Russian authorities pursuant to, in particular, the “Sevastopol City Council decision of 17 March 2014 no. 7156 on the status of hero-city Sevastopol”, the “Decree of the Supreme Council of the Autonomous Republic of Crimea of 17 March 2014 on independence of the Republic of Crimea” and subsequent normative instruments. The Federal Constitutional Law of the Russian Federation No. 6-FKZ of 21 March 2014 (hereinafter referred as “6 ‑ FKZ”), which formalised assertion of Russian jurisdiction over Crimea under Russian law, provided for transitional arrangements aimed at homogenising the regulation of, among other things, real estate and corporate relations in Crimea and Sevastopol with the legal regime established in the Russian Federation.

The new legal regime required all foreign legal entities based in or managed from Crimea and Sevastopol to re-register under Russian law or establish their Russian branches until 1 March 2015. Those failing to do so would be liquidated.

The transitional arrangements also required that all real estate in Crimea and Sevastopol and the requisite titles to it be re-registered under Russian law in the corresponding registers and cadastres. These arrangements were subsequently extended several times and are to be partially in force until 1 January 2025.

The “Sevastopol City Law no. 46-SZ of 25 July 2014 on particularities of legal regulation of property and land issues” and the “Law of the Republic of Crimea no. 38-ZRK of 31 July 2014 on particularities of legal regulation of property and land issues”, as parts of these transitional arrangements, stated that titles to real estate acquired by foreign legal entities prior to entry of the 6-FKZ into legal force should be preserved. At the same time, foreign legal entities were precluded from alienating these objects to any foreign subjects or any Russian legal entities with foreign participation. As regards the right of the permanent use of land, which was not recognised in Russia, the foreign legal entities which had acquired such a right prior to entry into force of the 6-FKZ were required to convert it into a lease of land or purchase the respective land plots from the public domain, if allowed under Russian law. The initial deadline for this was set for 1 March 2015 but eventually extended until 1 September 2019.

At different points in time between 2015 and 2017 the Russian authorities (the “Sevastopol department of property and land relations”, or the “Crimea ministry of property and land relations”) sued the applicant companies (or, in application no. 35438/20, three foreign companies to which the applicant company’s title had allegedly been alienated) with a view to claiming their real estate as public property and having their titles annulled.

In applications nos. 29497/18 and 52884/18 the Russian authorities claimed that the initial allocation of the real estate to private persons, from which the applicant companies later purchased it, had not fully complied with Ukrainian law applicable at the material time, and on this ground requested its “return” into public domain.

In application no. 34345/20 the Russian authorities sought annulment of the permanent use title and requested “return” of the land plot, since the applicant company, a Ukrainian legal entity, had failed to convert its title and had not registered as a Russian legal entity. On 5 May 2017 the Russian local authorities in Sevastopol also declared the applicant company’s hydraulic facilities as theirs. The applicant company challenged the respective decision before the courts.

In application no. 35438/20 the Russian authorities sought the annulment of the title of a foreign company, which had allegedly acquired the applicant company’s title during the events of 2008-2009. The applicant company joined the proceedings as a third-party, claiming recognition of its right of the collective ownership over a part of the disputed land.

The Russian courts granted all the Russian authorities’ claims and ordered that the applicant companies’ real estate be “returned” from the possession or use by private parties to the Russian authorities. In application no. 35345/20 the applicant company’s claim was rejected as, according to the Russian courts, the hydraulic facilities could not belong to the applicant company under Russian law. In application no. 35438/20 the applicant company’s claim was rejected on grounds of its alleged conspiracy in the 2008-2009 events leading to alienation of the land to a foreign company (which had been unlawful under Ukrainian law applicable at the material time).

Relying on Article 6 § 1 of the Convention and Article 1 of Protocol No. 1 thereto the applicant companies raise the following complaints against the Russian Federation.

They argue that the annulment of their titles and requisition of the disputed real estate ordered by the Russian courts constituted a de facto expropriation of their property. According to them, this measure was arbitrary, did not pursue a legitimate aim and was not provided for by law.

The applicant companies also allege that the court proceedings concerning their properties fell short of the guarantees of a fair hearing. They rely on Article 6 § 1 of the Convention in this regard.

According to the applicant companies in applications nos. 29497/18 and 52884/18, given that the legality of the privatisation process, which eventually led to the acquisition of their ownership titles, was verified and confirmed by final decisions of Ukrainian courts, the de facto expropriation orders, which questioned it, were not in conformity with the res judicata principle. They rely on Article 6 § 1 of the Convention in this regard. The applicant company in application no. 29497/18 additionally alleges that the Russian courts which dealt with its case were not independent and impartial tribunals established by law.

QUESTIONS TO THE PARTIES

1. Have the applicant companies complied with the admissibility criteria set out in Article 35 of the Convention?

2. Do the facts to which the applicant companies refer constitute a violation of Article 1 of Protocol No. 1 of the Convention?

3. Did the alleged acts which gave rise to the applicant companies’ complaints have a basis in “law” within the meaning of the Convention provisions relied on by them?

4. Did the applicant companies have a fair hearing in the determination of their civil rights and obligations by an independent and impartial tribunal established by law, in accordance with Article 6 § 1 of the Convention?

Also, in applications nos. 29497/18 and 52884/18, did the orders of the Russian courts comply with the res judicata principle?

APPENDIX

List of applications

No.

Application no.

Case name

Lodged on

Applicant company Year of Creation Place of Registration Nationality

Represented by

Identification of property

1.

29497/18

Chernomor Invest, TOV v. Russia

08/06/2018

CHERNOMOR INVEST, TOV 2006 Kharkiv Ukrainian

Andriy Anatoliyovych KRISTENKO

7,469 sq. m of land in Zaozerne village, Yevpatoriya, privatised by a private company Ch.; the applicant company purchased it from Ch. and registered its title under Ukrainian law on 27 September 2006

2.

52884/18

OOO Professionalnyy futbolnyy klub Sevastopol v. Russia

26/10/2018

OOO PROFESSIONALNYY FUTBOLNYY KLUB SEVASTOPOL Sevastopol Russian

Aleksandr Sergeyevich SURZHIN

2.0525 ha of land with the “Chayka” stadium complex in Sevastopol; the stadium complex was privatised by a third-party organisation Cha.; the applicant company purchased it from Cha. and registered its title under Ukrainian law on 27 December 2007; the applicant company’s right to use 2.0525 ha of land under the stadium complex was recognized by the judgment of the Commercial Court of Sevastopol of 25 March 2009

3.

34345/20

Agrofirma Chervonyy Zhovten, KSP v. Russia

13/06/2020

AGROFIRMA CHERVONYY ZHOVTEN, KSP 1996 Kyiv Ukrainian

Andrey Nikolayevich TARASEVICH

1773.7 ha of agricultural land in Sevastopol allocated to the applicant company for permanent use with its title registered under Ukrainian law on 11 March 1999

Several complexes of hydraulic facilities privatised by the applicant company’s predecessor P., with its title registered under Ukrainian law on 12 December 1995, and subsequently transferred to the applicant company:

- “Turystskyy” and no. 17 complexes located in Orlyne village, Sevastopol

- “Biyuk-Muskomiya” complex located in Shyroke village, Sevastopol

- “Novobobrovskyy” complex no. 19 located in Novobobrovske village, Sevastopol

- “Urkusta” complex located in Peredove village, Sevastopol

- “Varnautskyy” complex located in Goncharne village, Sevastopol

- “B. Kizilova” complex no. 15 located in Kyzylove village, Sevastopol

4.

35438/20

Agrofirma Chervonyy Zhovten, KSP v. Russia

07/08/2020

AGROFIRMA CHERVONYY ZHOVTEN, KSP 1996 Kyiv Ukrainian

Andrey Nikolayevich TARASEVICH

Several plots of agricultural land, amounting to 261.07 ha, located in Sevastopol; the applicant company was granted the right of collective ownership in 3,244.4 ha of agricultural land and registered its title under Ukrainian law on 12 February 1998; according to the applicant company, it was left with 261.07 ha of that land after a series of alienations of the parts of the collectively owned land to its members and third parties