FEATURES OF OBTAINING COMPENSATION FOR DESTROYED OR DAMAGED HOUSING
On March 17, 2023, the President signed the long-awaited Law No. 7198, which introduces compensation for damage and destruction of certain categories of real estate caused by hostilities, terrorist acts, or sabotage resulting from the military aggression of the russian federation.
LBASE lawyers have carefully analyzed the content of this Law and below we offer a selection of its most important provisions:
1. Compensation will be provided exclusively for damaged or destroyed residential property: apartments, dormitory rooms, detached houses, vacation homes, etc.
There will be three ways to receive compensation:
– performing construction works on the damaged property to restore it and/or providing construction materials for such works (applies only to damaged housing);
– providing monetary funds by transferring them to a special-use bank account of the compensation recipient for future construction (applies only to destroyed housing);
– financing the purchase of housing (including financing the purchase of a future building or investing in its construction) using a housing certificate (applies only to destroyed housing).
2. If the applicant chooses compensation in the form of a certificate, it may be used only within 5 years from the date of issuance, and the acquired property cannot be sold for 5 years, except for inheritance.
3. It is allowed to use multiple certificates simultaneously.
4. The Law does not set a maximum amount of compensation — neither monetary nor in the form of a housing certificate.
5. The provisions of the Law do not apply to properties that were located in temporarily occupied territories as of February 24, 2022.
6. Compensation may be obtained only for property that was damaged or destroyed starting from February 24, 2022.
7. The right to compensation belongs only to individuals — citizens of Ukraine, and in the case of damage to common property of an apartment building — to condominium associations (OSBB), property managers of multi-apartment buildings, and housing cooperatives responsible for maintaining such buildings.
8. Priority right to compensation is granted to:
– combatants,
– persons with disabilities caused by war,
– mobilized servicemembers who were not granted combatant status,
– large families,
– persons with disabilities (Groups I and II).
9. Compensation will not be granted to individuals included in sanctions lists, individuals convicted of crimes against national security, and their heirs.
Additionally, LBASE lawyers have prepared a checklist of required steps to obtain compensation for destroyed/damaged housing, which you will find in our next post.
22.03.2023
