Compensation for Expropriations in Russia and in Russian-Occupied Areas
Russia can still be held accountable under the European Convention on Human Rights
Russian forces, and armed forces that de facto act on behalf of the Russian Federation, have looted from civilians in occupied parts of Ukraine. These are expropriations to which the yardstick of international human rights law can be applied. Also, in reaction to the illegal war of aggression waged by the Russian Federation against Ukraine and to the many crimes committed by Russian forces against the civilian population of Ukraine, like-minded countries from Europe and North America, together with countries such as Japan, Australia, and New Zealand, have imposed numerous sanctions against Russia. In reaction, the Russian government is currently in the process of expropriating subsidiaries of companies that are based in these countries that Moscow now perceives as hostile. In May 2022, French car-making company Renault was forced to hand over its assets in the Russian Federation, including its majority stake in AvtoVAZ, to Russia’s Central Research and Development Automobile and Engine Institute. While such transactions might be phrased in terms of a sales contract between foreign companies and Russian entities, they de facto amount to expropriations.
How can the European Convention on Human Rights (ECHR) be utilized to gain compensation for the victims of expropriations? Article 41 ECHR includes a rule that provides for compensation for victims of human rights violations. But Russia is no longer a party to the ECHR. At least for the time being, this does not yet matter. On 16 March 2022, the Russian Federation was expelled from the Council of Europe (CoE). This has the consequence that six months from this date, the European Convention on Human Rights (ECHR) will no longer apply with regard to the Russian Federation. At this time, though, Russia is still obliged to honor the ECHR. This means that any expropriations conducted prior to 16 September 2022 will have to meet the requirements accepted by the Russian Federation when it ratified the ECHR.
At the moment, it might seem meaningless to sue Russia at the European Court of Human Rights as Moscow is unlikely to comply with any judgment rendered by Strasbourg. But potential applicants should think in the long term. In the last years, Russia’s track record regarding compliance with the standards of the ECHR had been spotty at best and it is easy to see that compliance by Moscow with the ECHR is very unlikely at this moment. However, in the long run, Russia, under a new government, indeed, most likely under a very different system of government, might seek to reestablish ties with the rest of Europe. This would require a complete end to the war, withdrawal of all Russian forces from areas in Ukraine and elsewhere, such as Georgia or Moldova, where they are deployed without the consent of the local authorities. It would most likely also require an honest effort by any future government in Moscow to provide compensation and to hold those responsible for war crimes, crimes against humanity and acts of genocide legally accountable.
Today, Russia is far away from such a possibility and public attention will have to focus on actually winning the war. Entities, such as foreign companies, that still have assets located within the Russian Federation which they are unable to withdraw, and that face expropriation, might, however, be well advised to already create the fundament for future claims against Russia today. As historical experiences, for example in the context of crimes committed by Germany during the Nazi years or by Communist governments during Soviet times, show, compensation claims can come many years after the actual expropriation. Indeed, there might even be situations when later legislation might perpetuate earlier expropriations and might lead to new claims. In any case might be it useful for potential future claimants to establish in the Russian courts already today that they oppose attempts at expropriation. Doing so should include clear claims with regard to the illegality of such expropriations in light of the ECHR, that continues to apply to Russia, if only for a few more months.
Therefore, this text is intended to introduce the reader to the current state of jurisprudence by the European Court of Human Rights (ECtHR) on the matter of expropriation. While the current situation in the Russian Federation has provided the inspiration for writing this text, the legal issues at stake are of course equally relevant in all States that have ratified the ECHR.
At first sight, the position of property rights in the Convention system appears unusual. The right is not contained in the Convention itself, which is very much focused on civil and political rights. This focus is a product of the specific circumstances in which the ECHR was drafted by representatives of Western European States in the aftermath of World War II. Due to the importance of property rights, they were included in the first article of the (first) protocol to the Convention (P1-ECHR). This protocol was adopted less than a year and a half after the ECHR itself.
Entitled “Protection of property”, Article 1 P1-ECHR, protects not only property but introduces a specific legal term, that of “possessions”. The norm reads as follows:
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”
Like in the case of most other rights protected by the Convention, the right can be enjoyed by natural and legal persons. Similar to other norms, such as Articles 8 to 11 ECHR, the scope of the norm, contained in the first sentence of the norm, is followed by the conditions for the justification of interferences. Although the paragraphs of Article 1 P1-ECHR are not numbered, the norm is split into two factual paragraphs by the layout in the version provided by the Council of Europe. The second paragraph, consisting of the final sentence, has to be seen in connection with the second sentence as a continuation of the explanation as to what the State is permitted to do. Sentences two and three together provide potential justifications for interferences. Like in the case of most other norms contained in the Convention system, the terms employed in Article 1 P1-ECHR have been substantiated in more detailed in the jurisprudence of the Convention organs. This begins already with the very core of the right because the term ‘possessions’ does have an autonomous meaning, i.e., the meaning of the word ‘possessions’ in the context of the ECHR is not dependent on the meaning the same term might have in the domestic legal systems of any of the States that are parties to the ECHR. Instead, there term has a meaning of its own within the framework of the Convention system. Classical property rights, ownership, is included in the definition employed by the European Court of Human Rights. Therefore, illegal expropriations in Russia or in areas occupied by Russian forces or proxy forces that operate on behalf of Russia and the actions of which can be attributed to Russia, can amount to violations of Article 1 P1-ECHR and they can give rise to compensation claims - even if these claims can only be enforced at an indeterminate time in the future.
About the author
Prof. Dr. Stefan Kirchner is working at the intersection of international environmental law, human rights, and the law of the sea. In addition to practising law, he has taught international law at universities in Germany, Finland, Italy, Lithuania, Ukraine, and Greenland. His most recent books include “Security and Technology in Arctic Governance” (ed., 2022), “Governing the Crisis: Law, Human Rights and COVID-19” (ed., 2021), “El Ártico y su gente - Ensayos de derecho internacional” (2020), and “The Baltic Sea and the Law of the Sea - Finnish Perspectives” (with T. Koivurova, H. Ringbom and P. Kleemola-Juntunen, 2019). This text only reflects his personal opinion.