War Damage Assessment

Ukrainian businesses incurred and are still incurring heavy losses caused by russia's full-scale military aggression. Production processes and supply chains are disrupted, businesses and logistics centers are destroyed, and the worst thing is that human lives are under constant threat. According to a survey of the European Business Association, every fifth entrepreneur in Ukraine suffered more than $100,000 in losses from the war. To get reimbursement for the damage caused, the first step is to record and assess the damage from the war.
 

BDO in Ukraine's team of specialists performs an independent expert assessment of losses from military operations as required by the current Ukrainian law. 

  Damage assessment methodology

The assessment of damage, the cost of losses and lost profits due to the armed aggression of the russian federation is carried out in accordance with the Order “On approval of the methodology for determining the damage and cost of losses incurred by enterprises, institutions and companies of all forms of ownership as a result of the destruction and damage to their property due to the armed aggression of the Russian Federation, as well as lost profits from the impossibility or obstacles to business activities”, approved on 18.10.2022 together with the Ministry of Economy of Ukraine and the State Property Fund of Ukraine.

The methodology is mandatory for use in assessing the damage caused to victims of the russian aggression, conducting forensic examinations (expert studies) related to the assessment of losses as a result of military operations, and its provisions prevail over other provisions of legal acts, methodologies, recommendations, etc. that regulate the matters of determining the amount of damage from military operations to enterprises, institutions, organizations, and other business entities of all forms of ownership. 

Objectives of assessment of damages from the armed aggression of the russian federation:

• Determination of damages caused by the armed invasion of the aggressor within the framework of criminal proceedings under the law of Ukraine.
• Assessment of damage caused by armed aggression for the purpose of filing claims for compensation for material damage by victims.
• Expert assessment and determination of the damage loss caused by the war for the purpose of filing claims (including collective claims) by victims in international courts, as well as filing a claim by the State of Ukraine in international courts.
• Other needs defined by the law.

  War damage assessment by experts has the following objectives:
 

• determining the amount of actual damages;
• determining lost profits;      
• determining the material costs necessary to restore property and property rights that have been damaged by hostilities.

  Date of assessment
 

The assessment date is the date on which the assessment of losses is carried out so as to further compensate them. The date of assessment shall be determined based on the provisions of part three of Article 225 of the Commercial Code of Ukraine and shall be any date preceding or coinciding with the date of filing a claim with the court (the date of applying to the relevant authority for compensation), but not earlier than February 24, 2022.

The Expert Witness report is valid until the date of compensation (inclusive).

Stages of damage assessment
 

To learn more about BDO in Ukraine services on the war damage assessment or to order an assessment service, please contact our specialists.