RC Vozdvyzhenka Appeals to President and National Security and Defense Council on Risks to Institution of Seized Property Management Due to ARMA's Actions.

Vozdvizhenka Housing Management Company (VHMC), one of the most efficient managers of ARMA, claims that the institution of managing seized assets is threatened by the Agency's actions. The existing risks may lead to the fact that sanctioned Russian citizens will be able to regain actual control over seized assets in Ukraine. Representatives of the HACC publicly appealed to the President, the Government and the National Security and Defense Council to resolve this critical situation. This was discussed at a press conference held by the Company's representatives at Interfax-Ukraine on April 17, 2024.

Gennadiy Piontkovsky, a representative of the sole participant of Vozdvyzhenka Housing Association, and Olga Shabelnyk, the company's director, revealed what could be behind ARMA's statements about the desire to terminate the management agreements with the housing association and what the consequences might be.

Gennadiy Piontkovsky completely refuted the previous statement of ARMA of April 5, 2024, which referred to the alleged "improper management" of assets. He cited data that showed that the lion's share of ARMA's income from the management of seized assets is provided by the Housing and Utilities Department:

"The total amount that we have paid to the budgets of all levels since the start of the management of seized property has reached almost UAH 177 million, including UAH 16 million in 2024. ARMA's remuneration for this period amounted to UAH 94.5 million, including almost UAH 10 million in 2024. According to ARMA, the housing offices "instantly" - in less than 2 months - turned from one of the best managers to the worst. But the numbers speak for themselves. For 2019-2023, the Housing Office has more than 400 certificates of approval of expenditures and effective management from ARMA. There is only 1 certificate for February 2024, in which ARMA for some reason included data for 2023, where our management is recognized as inadequate."

He also stated during the press conference: "I, as a representative of the sole member of the Housing and Utility Company, still do not understand how and why the same ARMA employees who have been approving all cost items for 6 years did not approve the same items in February 2024."

Vozdvyzhenka Housing Association LLC previously stated that "speculation about the inefficiency of the housing and communal services company's management of assets contradicts the Law on ARMA, the Procedure for Monitoring the Efficiency of Asset Management and the Guidelines for the Management of Seized Property."
"ARMA's actions make us think that there has been some bias against Vozdvyzhenka recently, and information from tenants suggests that ARMA is acting on someone's order. Everything points to the fact that they are looking for any reason to get rid of Vozdvyzhenka as a manager," said Gennadiy Piontkovsky.

The bias of ARMA is also evidenced by endless inquiries and inspections that paralyze the business activities of Vozdvyzhenka RC LLC. At the same time, ARMA is inspecting 195 assets, during which the business has also prepared and is preparing explanations.
"Employees of the housing office are preparing ARMA's responses almost from morning to night. In total, more than 50 responses, justifications and explanations on 7,000 pages were submitted in a timely manner," emphasized Olga Shabelnyk. She added that the main consequences of the described actions of the ARMA include: dismissal of up to 70 employees who did their job in good faith and ensured revenues to the budgets of all levels; threats to the business activities of tenants; non-receipt of funds to the state budget, at least UAH 5 million per month; destruction and depreciation of real estate, etc.

Olga Shabelnyk is confident that the current situation may discredit the process of managing seized property in general: "Our case is a litmus test that will determine whether the process of managing seized property will be transparent in the future or whether all participants in this process will remain hostage to backroom deals. We are convinced that any government agency, be it tax, customs or ARMA, should build a service model in cooperation with the business environment, not a criminal one. This is what our Western partners also expect from them. It is not for nothing that the appointment of the ARMA leadership was the focus of attention of the G7 ambassadors."

A representative of the sole participant of Vozdvyzhenka Residential Complex LLC, which manages the assets of sanctioned persons with ties to Russia, emphasized the main risk if ARMA's actions lead to termination of management agreements: "It will not be possible to legally ensure the continuity of management, as ARMA claims. We declare this responsibly and with all the information we have. Vozdvyzhenka Residential Complex LLC is one of the main participants in building the institution of managing seized property, and the company's employees are familiar with all the pitfalls. Holding a new tender, reassessing the property, and obtaining all the necessary permits will take from 8 months to a year. Once the management agreement with Vozdvyzhenka LLC expires, the former owners - collaborators and traitors to the Motherland - will be able to gain actual access to their assets. In March 2024, the prosecutor's office drew ARMA's attention to this problem."

Vozdvyzhenka Housing Complex LLC appeals to the President, the Government and the National Security and Defense Council to pay attention to the current situation and prevent sabotage of the main purpose of arrest and management - ensuring the preservation of material evidence, the inevitability of the negative consequences of criminal offenses, especially for criminals hiding in the territory of the aggressor state. Representatives of the HCC emphasize that ARMA has now appealed to the Verkhovna Rada to adopt certain amendments to the law regarding the management of corporate rights without the need to coordinate decisions with the owners in Russia. However, such actions of the Agency indicate either a misunderstanding of its competence or its deliberate disregard for it, since there is no need to wait for any new laws to control the seized Russian assets.

Concluding the press conference, Gennadiy Piontkovskiy summarized: "The Housing and Communal Services Department has been doing and will continue to do everything to increase budget revenues from asset management until the last day of the management contracts. The new ARMA team is acting inconsistently and ill-considered towards its best manager, contrary to its own statements and decisions. The HACC asks ARMA to stop the pressure and return to a constructive dialog in order to improve the efficiency of asset management, which will benefit all participants of these legal relations."

Tags: #arma #rc_vozdvyzhenka