Manipulations over compensation law for property damaged and destroyed by Russia

1) Ukrainians will not receive monetary compensation for their damaged and destroyed housing. 

The headline undoubtedly grabs attention and sparks a wave of discontent, like “How can this be true?” However, both the headline and the underlying thesis can be considered somewhat provocative and misleading without understanding the importance of the key word: “monetary”. It’s essential to understand that compensation will indeed be provided, but it won’t be in the form of direct cash or funds transferred to individual hands or bank accounts, to be spent as they please. This situation is somewhat similar to the “covid” certificates that were issued, entitling persons to 1,000 hryvnias under certain conditions, but with limitations on how the money could be utilized.

To clarify, Ukrainians will receive compensation specifically for their destroyed property. We will explain the details about damaged property below. 

2) Initially, the earlier versions of the Law included provisions for monetary compensation to be provided to Ukrainian citizens. However, currently, they are gradually losing the ability to independently manage the funds that were intended as compensation for their housing.

Both the first version of the draft law, which was registered on March 24, 2022, and the subsequent law signed by the President, outlined various methods of compensating for damaged and/or destroyed residential real estate. These methods involved either transferring funds to “a designated current account with special conditions for their use” or financing the construction of new housing. The initial version even proposed financing restoration work for apartment buildings, including stairwells, elevators, and common areas. In the final version, compensation for damaged property will be provided in the form of construction work and building materials.

Both versions of the law had, and continue to have, their own specific details.

The initial version of the draft law included provisions for monetary compensation to assist in the repair of a damaged apartment, as well as for the restoration of a private garden or country house in case of destruction. In the case of a completely destroyed house or apartment, the proposal entailed financing the construction of a similar dwelling in terms of both area and type.

3) However, a new proposal suggests the implementation of an electronic certificate, for example, for apartments. Individuals whose houses have been destroyed will be offered the option to create an account where funds designated for construction purposes will be held.

As mentioned earlier, the initial version of the law stipulated that the funds would be transferred to a current account. 

The law, subsequently signed by the president, outlines two methods of compensation: 

• monetary compensation will be transferred to a current account that “operates under a special regime for the utilization of these funds”. This allocation is intended to finance the construction of housing.
• Individuals may receive a housing certificate, which can be used to purchase prefabricated homes or to provide financial assistance for the construction of a new home.

If your farm-type house, garden, or country house, including construction objects (farm-type houses, garden and summer houses) has been destroyed due to the war, you have the option to choose the type of compensation that suits you best: either through a monetary transfer to an account or by receiving a certificate.

However, if you have lost an apartment, the only available form of compensation is through a certificate. This certificate will cover the expenses associated with the construction or purchase of a new apartment.

4) Simultaneously, local self-governments will manage these funds and supervise the selection of a  contractor for the construction or renovation of the building.

Regarding the source, we were unable to locate where the author of the video obtained this particular point. According to the law, it states that “the entity responsible for initiating construction related to the restoration of damaged real estate that is not under communal ownership of the respective territorial communities could be the executive body of a village, town, or city council”. This provision may or may not apply, particularly in cases where the construction is not starting from scratch. As previously mentioned, compensation is available for DESTROYED housing, while assistance will be provided for damaged housing, either through labor or building materials, to aid in its reconstruction