Restrictions on banks’ expenditure operations regarding accounts of persons connected with the Russian Federation also apply to compulsory recovery of funds under enforcement proceedings – SC CommCC

The restrictions set out in paragraph 15 of the Resolution of the National Bank of Ukraine dated February 24, 2022, No. 18 “On the Operation of the Banking System During Martial Law” (NBU Resolution) apply to all expenditure operations on the accounts of legal entities whose ultimate beneficial owners are residents of the Russian Federation or the Republic of Belarus, regardless of who initiates the operation (the client or the claimant), except for a limited list of permitted operations. Such restrictions are lawful and binding for banks, including in cases of compulsory recovery of funds under enforcement proceedings.

This conclusion was reached by a panel of judges of the Commercial Cassation Court of the Supreme Court.

Company 1 (LLC-1) filed a lawsuit against a bank, seeking recognition of the bank’s refusal to execute payment instructions issued by a private enforcement officer as unlawful and demanding that the bank be ordered to forcibly debit funds from the debtor’s account (LLC-2) within the framework of consolidated enforcement proceedings. The claim was based on the argument that the bank unjustifiably returned the payment instructions, referring to paragraph 15 of the NBU Resolution, which prohibits expenditure operations on accounts of legal entities whose ultimate beneficial owners are residents of the Russian Federation. 

The local commercial court upheld the claim. However, the commercial court of appeal reversed that decision and adopted a new one – rejecting the claim.

The SC CommCC upheld the ruling of the appellate court, emphasizing that the temporary restrictions established by the NBU Resolution prohibit servicing banks from carrying out expenditure operations on accounts of residents of the Russian Federation/Republic of Belarus and on accounts of legal entities (except banks) whose ultimate beneficial owners are such residents, except for the explicitly defined list of permitted operations.

According to paragraph 15 of the NBU Resolution, the prohibition applies to all operations that reduce the client’s account assets, regardless of who initiates the transaction – the client or the claimant – except for the exhaustive list of permitted expenditure operations.

The SC CommCC stated that since the ultimate beneficial owners of LLC-2 are residents of the Russian Federation, and there are no exceptions allowing the bank to perform expenditure operations, the bank’s actions in returning the payment instructions to the private enforcement officer without execution were lawful and complied with the restrictions established by paragraph 15 of the NBU Resolution.

Resolution of the Commercial Cassation Court within the Supreme Court of 4 September 2025 in case No. 910/12872/24 - http://reyestr.court.gov.ua/Review/129994568.

This and other legal positions of the Supreme Court can be found in the Database of Legal Positions of the Supreme Court - https://lpd.court.gov.ua.