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The Lawfare Podcast
Lawfare Daily: Reparations for Russia's Aggression Against Ukraine with Markiyan Kliuchkovskyi and Patrick Pearsall
01:13:36
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- [00:01]
Lawfare Host
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- [00:32]
Marcian Klukovski
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- [01:00]
Maddie
Hi, it's Maddie from After Myths, Misdeeds and the Paranormal on the Most Terrifying Places in America Travel with ghost hunters, psychics and historians as they uncover the chilling truth behind America's paranormal hotspots. From a haunted hotel in New England to a Texas warship where the dead still walk the decks, it's a podcast that's part cross country road trip, part ghost tour. Listen to Most Terrifying Places in America wherever you get your podcasts.
- [01:39]
Marcian Klukovski
Quite importantly, we have to make sure our system is scalable because we fully expect that the number of claims could reach millions based on the scope and scale of the destruction in Ukraine and general impact of the war.
- [01:55]
Mikhailo Soldatenko
It's Lawfair podcast. My name is Mikhailo Soldatenko, Lawfair Legal Fellow, and together with Scott Anderson, Lawfair Senior Editor, we are joined by Marc Jan Klukovski, Executive Director of the Register of Damage for Ukraine at the Council of Europe and a former legal advisor to the Office of the President of Ukraine on the issue of reparations and Patrick Pearsall, Partner at the Washington, D.C. office of Gibson Dunn and former Chief of Investment Arbitration at the US Department of State. Patrick also advised Ukraine on reparations as a Director of the Columbia Law School Claims and Reparations Project.
- [02:35]
Patrick Pearsall
I think there is an interest in Russia to ensure a process, just like Iraq did in the UNCC context, to find a way forward that gives a structure and a pathway for settling these issues in a way that won't expose them to jurisdictions throughout the world.
- [02:57]
Mikhailo Soldatenko
Today we discuss the steps Ukraine has made so far on the path of getting reparations from Russia, Ukraine's reparation mechanism, the fate of frozen Russian assets, and the relevance of the reparations to the Ukraine Russia talks that took place Recently. As of December 2024. The the estimate costs for Ukraine recovery and reconstruction after the war is $500 billion. And two of our guests from the early months of the full scale invasion of Russia against Ukraine advised Ukraine on ways how to effectively get compensation for the damage. And it would be fair to say that they are founding fathers of the reparation initiative. So let's start with Marian. So Marian, how this idea to design a mechanism in order to have an effective way to get compensation from Russia, how did it emerge? How did you pitch it to the Ukrainian government and just give us the gist of the idea?
- [04:18]
Marcian Klukovski
Well, thanks first of all for having me on the podcast, really pleasure to be here and to talk about these things. The idea for the reparations mechanism came in a somewhat dramatic fashion. Like many Ukrainians in the early days of the war, I was spending a night in a bomb shelter which doubled as my car park under my building. I was in a car, I was cold and miserable, quite upset naturally. And I was trying to dig deep into 20 years of experience in international dispute resolution and private practice to figure out a way to sue Russia for damage. Because that is in my, in my professional DNA to find a way to sue those who have wronged all my clients and general public and so on and so forth. And frankly quickly came to the realization that there is no forum where that suit could be brought that where damage could be claimed. Then I started looking at how these things were handled in the past and other conflicts, other wars, realized that there's this thing of a claims commission that usually tackles things like that. One thing led to another. I realized I need some support for that. So I called up Patrick, quite literally gave him a call and asked if Patrick knew anything about claims commission and maybe we could put our heads together. Patrick brought in a couple of more people into that discussion with experience on post conflict reparation mechanisms and we put together, I wouldn't even call it a non paper, a three page note or two and a half page note outlining the basic ideas of how that could be pulled together considering the natural limitations political and legal, most notably Russia's obvious inability, unwillingness and inability to cooperate and Russia's role as a permanent member of the Security Council and inability of that body to, to intervene. So we propose the mechanism that would be built through the joint effort of the able and willing states, able and willing to uphold the values of international law, the principles of international law, the UN Charter, the basic fundamental rules that Those who are states that are responsible for violations in international law are under the duty to make reparation. And we pitched that to the Ukrainian government through the people that we knew through our previous work. And that idea gained traction. We had a chance to present it to President Zelensky and then we were quite frankly told to go and do it. So there I am.
- [07:06]
Mikhailo Soldatenko
Patrick, do you want to end anything to this first moment?
- [07:11]
Patrick Pearsall
Well, two things, I guess. Go and do it. I mean, part of the next 30 minutes or 40 minutes of the podcast will be talking about challenges and how we are seeking to overcome them, or did overcome them. But lost in that conversation is I think, the real genesis of this, which is a belief that international law as a remedy, in an instance like this. This is a completely unique situation when it comes to the establishment of a claims commission. Previous claims commissions have only been established after a dispute, after a conflict is completed as part of the reparations process which must follow. We started literally a week to two weeks after the full scale invasion began, which is unique and has raised all sorts of interesting challenges that Marquion and I and some others have sought to overcome. But I want to underline what I think is a real beautiful part of this narrative, which is a deep belief in the infancy of this horrific illegal invasion, this horrific aggression, this violation of the UN Charter, a deep belief that international law has an answer to that. And I think that that belief wasn't just shared among international lawyers like us on the podcast, but really at its core in the Ukrainian government, right at the highest levels. It is incredibly courageous and powerful, in my view, that President Zelensky and his advisors decided within weeks of the invasion, when they were being told that this invasion would result in the end of their government and their exile, or potentially worse, that they wanted to know what can the law do to ensure that victims in Mariupol elsewhere are compensated for the illegality. And I think that that's a really powerful, a powerful belief and a powerful motivator. And for me, that has been really the fuel that has sustained me in this three year journey. And certainly the courage of that kind of belief and kind of seeing what Marquion has done now is just amazing. So I just didn't want that to be lost in the origin story. And now we can talk about all the challenges and the things we did and basically how Marquion and I and some others were told no constantly and we just kind of did it. And now the same people, and I'm thinking here of the G7 and others who have told us no or told US no in 2022, time and time again, are now kind of all yeses, which is a really remarkable turn of events, but we can talk about that.
- [10:25]
Scott Anderson
So the institution that we're primarily talking about here, the novel aspect of the registry isn't something that exists in a lot of claims context. It's a very novel instrument, not entirely unprecedented by any means, but exceptional compared to a lot of other claims arrangements, including coming out of armed conflicts. And it's not the only strategy Ukraine has considered. Was considered when you came up with this proposal. Is still pursuing. Talk to us about how the registry idea came about and fits within the broader ecosystem of mechanisms of accountability and specifically looking at reparations and compensation for Ukraine and for Ukrainians arising out of this conflict. I'm curious, particularly about reactions initially. Why was there that skepticism from the G7? Was there similar skepticism on the parts of the Ukrainian side? And where is that founded? What were the alternatives that people were seeing as opposed to a step like this? Patrick, I'll start with you and then, Markin, I'll come to you next.
- [11:20]
Patrick Pearsall
Yeah, sure. Part of this was both a structural choice, but also a lot of it was driven by political exigency. So let me start with the structural choice. The structural elegance of a damages registry. And there is precedent for registries of damage while a conflict is ongoing.
- [11:43]
Mikhailo Soldatenko
Right.
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Patrick Pearsall
I'm thinking of UNRAAD and some others, but. But we thought structurally that's something that folks in the United nations, in the Council of Europe, in the G7 could understand.
- [11:56]
Mikhailo Soldatenko
Right.
- [11:56]
Patrick Pearsall
Let's at least account for the damage that is being done, gather evidence while it's still fresh. And that, I think, was understood both as a international law reaction, but also in, in part as a defensive, almost military structure. And that, you know, we, we anticipated and still anticipate that, that in discussions to cease the conflict, for the conflict to end, there will need to be a discussion on the amount of damage that has been visited upon, upon Ukraine. So we wanted to make sure that those chips, that conversation was in the, in the hands of those people who had been damaged so that they could, they could put that case to the aggressor as part of the ceasefire and things like that. So it had an elegance on all sides of the house structurally. But from a political standpoint, the damages registry was where the G7 thought they were, I think, safest with regard to general principles of public international law, in that there was no adjudicatory process whereby claims could be put to Russia or the aggressors and result in an award. Right. So that was a bridge too far. But there was a political need to make sure that the damage that was occurring, which at the time, in 2022, most thought would be ending much sooner than it did. There was that kind of move where, let's account for it, but there was a firm skepticism on anything more.
- [13:51]
Mikhailo Soldatenko
Right.
- [13:52]
Patrick Pearsall
Jurisdiction, some process whereby claims could be put where, how to use the funds, which I know we're going to get to. How would this be funded? All of that we studiously tried to not talk about in the early days of creating this thing, but we knew we needed some. Something to get the train moving.
- [14:12]
Mikhailo Soldatenko
Right?
- [14:13]
Patrick Pearsall
And this metaphor of kind of trying to build the plane while flying it, I think is Marcion's metaphor, or getting the train moving. We understood that once we had a certain amount of momentum, right, as long as we were keeping it in the kind of international law structures, things that people understood. But as long as we had a momentum, we could start to make new law, which is what we did. But we needed to start with something that was very recognizable and modest, which is why a registry of damage was our first choice. But the other thing that was really important here was at least Mark, Ann and I understood that the damages registry alone, without an adjudicatory process, or without a claims commission, which is what Marcion is working on now, that alone would almost be, frankly, in my personal opinion, worse than nothing. Because giving people a right without a remedy, or having them make claims where there's no result in compensation that would harm international law norms, Right. That's ultimately worse politically and worse for an international law result. So we always had it in our mind to have the second part. And we can tell you a little bit how we decided to do that. But let me pause there for Marcion's response.
- [15:40]
Marcian Klukovski
I think I can mostly just add a few things to that. One is that we tried to approach this process holistically, a fashionable word to use in this context. We understood that what we are proposing is very new. It has some precedent, but not in the way we were proposing to get there, and certainly not in the context of an ongoing active, hot war of that scale. So the holistic approach that I mentioned was not only to talk to within our small groups, not only to talk to the Ukrainian government to see what they feel like about the issue. It was also engaging broader community, those who have spent years and decades working on these programs, those who have written about that academically. So we engaged Them in that discussion to stress test a little bit our idea. And through that stress testing it, one of the suggestions that rose after that, after the discussion, would be to use another metaphor that I like to not eat an elephant in one go, but actually approach it one piece at a time, because that would make it a little bit easier to digest, easier to even understand what we are trying to build. And as Patrick has said, it would make it easier for states G7 and many others to commit to something that is not massive, that is not huge, that can actually be manageable. So we looked at that from a point of view of a roadmap that we need to go through to achieve that result. We understood that we needed to get some political and legal mandate from the broader community. So the first point of order was to see if we can get that mandate from the General assembly of the United nations that was sitting in emergency special session United for Peace context. In the context of locked Security Council, we had the example of damage register for UNRAD established by the General Assembly. So that became the basic premise that we started to work with. One particular challenge that we had was to go step by step, but also never lose sight of where we wanted to end up. So that sense of perspective of the completeness of the claims mechanism, completeness of the reparations program that we're trying to build was paramount because as Patrick has said, and I can only subscribe to that wholeheartedly, the Register in itself makes no sense as an independent and a standalone entity. It only makes sense as a component of something bigger. So we went through that. There was, of course, a huge amount of skepticism, disbelief, essentially every initial conversation that we had with the government or an institution. The first response we ever gotten was, that's impossible, that's too much, that's too hard, that's unprecedented. Lawyers and politicians like precedent to rely on. We did not have a luxury of that necessarily. But also not to say that this was something that was dictated externally. This is, and I'm living through that reality right now, having a Register of damage as this first component to work out the way for claimants to submit claims, to collect evidence in a coherent way across different categories, different types of claims, different types of claimants. To have that process worked out on a scale like the war in Ukraine requires. In many ways, the Register is also a proof of concept that it's possible to do with limited resources, with a lean budget, not becoming a bureaucracy, becoming a lean agile organization. Think, and I hope that we are executing on that quite well.
- [19:47]
Mikhailo Soldatenko
Marcian if I may, a short follow up on that. So when you put forward this idea, Ukraine had a number of legal advisors and they were also probably proposing and had some thoughts. So what were the alternative pathways to getting there and how they differed from your and Patrick's idea?
- [20:10]
Marcian Klukovski
First of all, we never insisted that this has to be the only path towards reparations. There were many ideas, some of them a little bit more creative than others. Many of them were centered on the use of conventional judicial system in Ukraine. In other countries, attempts to bring suits against the state of the Russian Federation, state companies, Wagner Military company and many others. But we never thought that those things had to be mutually exclusive. We had to build, however, a mechanism and that was our main premise that would allow for avenue towards reparation for everybody who has been affected by the war. We all know European Court of Human Rights that just delivered a massive judgment, really important, critically important judgment just the other day. But we know that its jurisdiction ended on 16 September 2022 because Russia was expelled from the Council of Europe. We know very well the pathway through arbitration. And the Crimean, so called Crimean arbitrations showed that that pathway is in some way achievable and doable. But that is only a pathway that only a select few claimants that have resources, that have millions of dollars to spend on this can afford. But a family, you know, somebody who lost a loved one whose apartment was destroyed, a family from Mariupol that had to flee from the war, or even a small business or medium business owner, they are left options that are practically workable. So we try to draw on this experience from the past of building mechanisms where every victim can can be recognized and can have realistic, practical, accessible remedy to that, regardless of how big or small they are and how experienced they are and how resourceful they are. And historically, the only path to that is a bespoke compensation mechanism. And we've tried to follow up on that. Ukraine very quickly recognized that, as Patrick has said, that was the first couple of weeks, couple of months of the war. There was something that Ukraine very quickly recognized. As I said, we had the pleasure of presenting this to President Zelensky and after receiving his approval, after the working group was formally established to address these matters, we went on to push it into the world, so to speak.
- [22:37]
Mikhailo Soldatenko
So moving forward, the first significant step on this path toward the compensation mechanism was the United Nations General assembly resolution on the furtherness of the remedy for compensating for the act of aggression. So many of our listeners, they would think that the UN General assembly resolution is non binding. So can you explain to them what is the significance of this resolution? Is there any legal effect for the future compensation mechanism and for the registry of damage for Ukraine?
- [23:19]
Patrick Pearsall
Yeah, I'll kick off there because I do think that the first significant step was Marcion's cold evening in the car park. The second significant step was the. The courage of Ukraine to give us a mandate.
- [23:35]
Marcian Klukovski
Right.
- [23:35]
Patrick Pearsall
The third significant step was actually prior to the UN General assembly resolution, which, which required, you know, thousands of miles of Marcion and I and, and some folks in Ukraine to, to convince folks in the United nations that this is something to support. We had to draft it. We met in the Hague. Like there was all sorts of stuff that came before. A lot of your listeners were involved in this conversation because one first thing we did in May and June was call together a group of experts, dozens of experts globally who were looking for ways to help. And we kind of brainstormed about why we think going to the UN was necessary, what we thought this would look like. And we met a lot of academic skepticism too. Right. Because it's not novel now that academic skepticism was in many ways meant to help, as opposed to some of the skepticism we saw originally in the G7, which was not as constructive. But the reason we thought about going to the UN wasn't because we thought it was going to be binding or because we wanted to further isolate a P5 member or whatever it was. We wanted top cover, we wanted political cover. We wanted, while we had the wind at our back, while the United nations was still focused on international lawmaking in this space, we wanted to create what we think is a novel, a brand new unique syllogism, which is connecting the registry of damage, which we already had some political buy in for, with another, like saying again that this is an international law violation. Right? So those two ingredients the UN had already said, followed with the third point, which is therefore compensation is due.
- [25:43]
Mikhailo Soldatenko
Right.
- [25:44]
Patrick Pearsall
Which is part of the ilc, which is part of the customary international law understanding of, you know, reparations. But connecting all three of those had never been done and certainly had not been done at the General assembly with the power of 94 votes. And if you read the resolution from November 14, 2022, it is that syllogism, which I think is unique. And then the other point which I think is worth noting is this is lightning speed. I mean, we started this in May and had a UN General assembly resolution voted on with 94 yeses and some abstentions, which we can Talk about in November of that year. That's lightning speed for international law. And the reason why we did that is because we wanted to kind of take advantage of that interest in the world to ensure that this doesn't happen again. And that, and I think we've been proven right, while it's non binding, we've reached a different moment in this conflict politically. I think we all can recognize that. And having that UN General assembly resolution has been helpful in talking about what we're doing in getting the Council of Europe process underway in holding States to their bargain as Marcion creates the Claims Commission. So I think we've been proven correct in that process. And it wasn't, it wasn't easy, but it's certainly something I'm particularly proud of because the UN for all of its faults, still is the place where countries can come together and come up with a consensus on the need for a certain international law instrument. And they did so there.
- [27:30]
Mikhailo Soldatenko
So, Patrick, you mentioned 94 votes in support of the resolution and that was enough procedurally to adopt it. Many critics, they mention and they focus a lot on abstentions, 74 abstentions. And they connect that they do a comparison with the prior resolutions condemning Russian aggressions. The March 2022 resolution got 141 votes. And so they make this comparison and they say some members of the so called Global south was not on board with the proposal. One of the reasons, and both in the west and the Global south, the argument of double standards is invoked, saying that the west didn't repent its sins in the past and it wants to create a bespoke mechanism for Ukraine. I always found this a little bit puzzling, why prior injustices should preclude justice in a particular case which can prevail and future injustices and have a precedent. But that's an argument that has a purchase among circles, some circles in the west and a lot of people in the Global south believe in it. So did you encounter that argument often? And what was your reply?
- [28:57]
Marcian Klukovski
Can I just jump in on that? Because I have a way of illustrating that path quite well. Well, first of all, those who deal with the UN would know that there is a big difference between a resolution that is basically a statement and a declaration, especially aimed at something as fundamental as restating the principles of UN Charter. And then a resolution that calls for action and a specific action and unprecedented action. In many ways, the resolution of 2 March is of the first kind of the former kind, where it was a matter of denouncing an act of aggression in direct violation of our Article 2 of the UN Charter, the sacred heart of the modern system of international law, international rules based order. The latter example is in the resolution that became the basis of the work on reparation. Because that was not just a declaration, that was a bit of that. Patrick spoke to that just before that. It was in many ways a simple restatement of, as he says, black letter international law. That the state has committed internationally wrongful act is bound to make reparation for it. But there was also a call to action in this resolution. There was a recognition that duty to make reparation does not live in isolation. It requires a means for implementation. And means for implementation is a mechanism to be established by international community together with Ukraine. So that was a recognition of that need and the recommendation to create a register of damage as a first step in that direction. This is, in the UN context, this is heavy action. And 94 votes, there should not be any doubt for that. 94 votes is an immense result for that. Because that's exactly what you're saying. There's a lot of discussion, not necessarily for double standards, but just in terms of what has happened in the past in the completely different political reality. As an illustration of that, there were two states who went on the record before the vote in explanation of the vote statements that said very similar thing. That this is in stark contrast with respect to injustices of the past, with respect to slave trade, with respect to other things, colonization and whatnot that had not been addressed before by the same un, by the same member states. However, and this is where the difference came to the surface. One state said that because of that they cannot support this mechanism. And another state said this is an opportunity to break that vicious cycle and support a mechanism that is supposed to address the consequences of injustice and supported that resolution. So that is the strength in that resolution. It is ultimately a political body and states take positions on legal matters from political points of view. And that is, that is par for the course in the UN. As I said, 94 votes was a fantastic result. Fantastic result. And gave all the mandate that Ukraine needed, that we needed to proceed with that and to build, to build this mechanism going forward.
- [32:09]
Lawfare Host
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- [34:42]
Maddie
Hi, it's Maddie from After Myths, misdeeds and the paranormal on the most terrifying places in America. Travel with ghost hunters, psychics and historians as they uncover the chilling truth behind America's paranormal hotspots. From a haunted hotel in New England to a Texas warship where the dead still walk the decks. It's a podcast that's part cross country road trip, part ghost tour. Listen to most terrifying places in America. Wherever you get your podcasts.
- [35:18]
Marcian Klukovski
This is.
- [35:19]
Patrick Pearsall
Car Tracks with Turtle Wax. Your car says a lot about you. So if we asked your car what.
- [35:25]
Lawfare Host
It would say about you, what would it say?
- [35:28]
Scott Anderson
Listen, you dropped one of those tiny.
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Patrick Pearsall
Cheeseburgers under the seat like last week and now we're both dry heaving at the stench. Do us a favor, grab some Turtle Wax and let's get to work.
- [35:38]
Mikhailo Soldatenko
Work.
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Patrick Pearsall
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Marcian Klukovski
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- [36:19]
Scott Anderson
So let's get into some of the nitty gritty of the Register and how it works exactly, because I think some folks listening to this who aren't familiar with claims issues generally might not understand exactly how the institution fits into the process. In particular, I think many people listening probably don't know the exact details of the scope of the jurisdiction, the scope of claims that the Registry is dealing with at this stage. So walk us through that a little bit. Marquion what sort of claims are they taking in? What information is it collecting? What is being registered, and where does that fit into the broader dispute resolution process? And how does it relate to the international law basis for reparations that's kind of underlying this whole process?
- [37:02]
Marcian Klukovski
Of course, one important thing in assessing and describing the Register is to look at it from a perspective of the entire compensation mechanism. The mechanism has three fundamental the Register, the Claims Commission and the Compensation Fund. The Register is meant to be a vehicle for collection of claims and evidence and assessment of their eligibility only. We just mean to make sure that the claims that we are collecting generally fit the mold that we are pursuing. So the Register is not assessing the value, the substance of the claims does not award any compensation. It just makes sure that the claims are eligible. Eligibility is very simple. Under our statute, claim is eligible if it relates to damage that has been incurred in the territory of Ukraine on or after 24th of February 2022, the date of full scale invasion, and has a causal link to the Russian aggression. The second component, the Claims Commission, will deal with the claims that we have recorded in the Register. We'll deal with them in the sense that it will assess them on substance, determine the scope of responsibility, and award the amount of compensation in each individual case, or in groups of cases as the case may be. And then the third component will kick in the Compensation Fund that is meant to ensure that those decisions are actually paid out. So we are now focusing on the first component of that, a component that in many ways is the most complicated in the sense of the need to organize the process, the credible process of submission of claims from vast variety of different claimant and different claims. We have through the work of our Board. We have A list of 43 categories in which claims can be submitted. They are broken down roughly into three groups. Claims from individuals, claims from businesses, and claims from the state of Ukraine and various state bodies. And then they're further broken down thematically. The difficulty that we have faced from day one was to conceive of a way that would allow for a mechanism for submission of these claims that would work for all of those categories and types of claims. So claim from an internally displaced person that had to flee from their home and seek shelter elsewhere should be submitted in the same way and according to the same standards as a claim from a governmental company that operates a nuclear power plant and that has been destroyed, or electric power plant that has been destroyed or damaged in the war, which is, of course, a much more complicated and difficult claim. So we partnered with Ukrainian authorities, with Ukrainian application called dia, that is an application for the provision of governmental services online that has 20 million users in Ukraine, to create a digital means for submission of claims. We are able to ensure that every claimant is identified through dia, because DIYA connects to the relevant registries and databases in Ukraine. So we are eliminating identity fraud in that sense, where we have to deal with bots and fake claimants and whatnot. So every claimant is somebody that we can identify individual or legal entities. Then DIA also connects to other databases where we can draw evidence from. So, for example, we can draw evidence on property titles to make sure that whoever submits a claim for destruction of a house is the owner of that house, or that the person is a family member of a deceased that has the right to submit a claim. And we also collect evidence. We can draw on evidence on other aspects related to the war. So we are building those systems. We go one by one because that that turned out. And maybe that's a lesson. One of the bigger lessons that I've learned through this work, that building these digital systems of submission of claims is difficult and painstaking. We have now 11 of those categories open for submission. We have, as of Today, more than 42,000 claims already submitted across the different categories, all by individuals. The claims by businesses in the state of Ukraine will start submission in the fall. And we are now going through, we're processing those claims and verifying their eligibility. And more than 12,000 of claims are already recorded in the register as eligible. So they are now awaiting the establishment of a claims commission to be further assessed. So this is the basic skeleton of what we are doing. Quite importantly, we have to make sure our system is scalable because we fully Expect that the number of claims could reach millions, based on the scope and scale of the destruction in Ukraine and general impact of the war. So we are already starting to build and implement advanced data processing tools that are built on the premises of machine learning and AI and other sorts of automation. Because of course, even if you have a team of 500 claim processors, it will take many decades to go through millions of claims if we look at that manually. So we have to automate. And that itself is a huge innovation, huge proof of concept that we're trying to achieve, that these technologies can be credibly and legitimately used in a context like this.
- [42:32]
Scott Anderson
So in this kind of tripartite system, you all very clearly started with the registry. That is the step that's most furthest along well established operational scaling up at this point. Why is that the step to start at? We've heard discussions about a claims commission for a long time. There's been a long standing conversation about, about seizing frozen Russian assets or otherwise finding compensation sources of funds. But the registry is where we've seen the most progress and where really the emphasis has been at this stage. Is that about preserving evidence? Is it about documenting the scope of damages for future negotiations strategically? Why is that significant? And relatedly, why did you choose to root this entity in the Council of Europe as opposed to the United Nations? Again, was that a political determination? Was there a legal basis for it? What's the logic behind that? How does it fit in the bigger strategic picture?
- [43:23]
Marcian Klukovski
So you're right, we started with the register of damage because. Well, because of many reasons. Firstly, and most simply, this is the first stage of the process. You cannot deal with the claims until you've collected them. And you have to think of what you're trying to collect, how to make it possible, practically possible, for people and entities to do that while the war is still ongoing, set the relevant standards, baselines, all that, before you start thinking about ways to analyze them, assess them and award any compensation. Secondly, it is of course a matter of preserving the record. Things are quite literally lost in the fog of war or smoke of war. And what is easy to establish and record now will not necessarily be that available in a few months or even more so, in a couple of years. Third is that the sense of injustice that was experienced in Ukraine was so strong that the public, people, claimants, and the government itself really craved for an outlet for that, the forum to turn to express a claim, to take a step towards, to fight back against that injustice. And then fourthly, and Patrick has alluded to that before, that was a step that was legally and politically the most obvious and the simplest. We are doing this in a way that hasn't been used before. States had to, let's use this word, come to terms with the legal basis of further steps. For example, is there a legal basis to establish a Claims Commission in the absence of cooperation of the other side and lacking the authority of the Security Council? It took a while to get that thinking together, to get the right legal and political mandates behind the States, and to come to the conclusion that it is indeed possible, which is now, that conclusion is crystallizing and we are hopefully entering the final stages of that work. And then even more difficult question in many ways is where the money is coming from for that. Most of this course is about frozen assets, and maybe fairly so, but this is not the only way in which it can be done. And I'm sure we'll get to that in the conversation. But that simple logic really was the basic premise of why this stepwise approach was taken. Now, with respect to institutional framework, the answer is really quite simple. The Council of Europe stepped forward with a proposal to host the Register under its umbrella and proposed an instrument that has a quirky name and enlarged partial agreement that would allow that to happen very, very quickly. So there were alternatives on the table. The Register could be established through a treaty mechanism as a standalone international organization. We all know how long it takes. I'm now having my firsthand experience with that on the Claims Commission, and then ratifications and other things that are hard to control and forecast. And on the other hand, there was this enlarged partial agreement, an instrument of cooperation within the Council of Europe that is open to other states that are members of that organization that could come together in weeks. And it did come together in weeks. The negotiations of the Statute of the Register and the enlarged partial agreement took literally three weeks. They started in the middle of March 2023. Well, maybe I should say the beginning of March 2023, and ended on the 30th of March, give or take. And two weeks later, at the summit of heads of state of the Council of Europe, the establishment of the Register was announced so very much picking up that lightning speed that we achieved in the un, in the General assembly, we continued in the same pace. And six months after Unger passed that resolution, the Register was a reality.
- [47:28]
Mikhailo Soldatenko
So the second element of the reparation mechanism is the International Claims Commission. And there were negotiations about establishing it. And some representatives of Ukraine said that they are expecting to have a treaty signed by the End of this year. So can you briefly explain to our listeners how would it look like were there any similar examples, similar precedents in the past? And also a separate question, Russia would likely object and the main argument would be we didn't give consent. Then you cannot have an international adjudication without our consent. And when you designed the initial idea, did you envision a possibility that if at some point in the future they would like to participate and to, you know, present any claims that they have that they would be able to do so? Do you have any thoughts on that?
- [48:34]
Marcian Klukovski
The negotiations for Claims Commission, first of all, they are ongoing and as I mentioned, they're entering their final phase. The preparatory work for that started almost, well, actually exactly a year ago. And now we'll have a third formal round of negotiations just next week in three days. And it is indeed the ambition to have the treaty adopted and open for signature at the end of this year. Year before we flip the page to 2026, the claims commission is an interesting body that it is designed to deal with mass consequences of a wide scale armed conflict. There are many examples in the past, but the most interesting and the most applicable to us is what is known as the UNCC UN Compensation Commission that was established in 1991 by the Security Council to address the consequences of Iraq's invasion and and occupation of Kuwait. UNCC had worked for 31 years, reviewed two and a half million claims and awarded US$52.5 billion of compensation to the victims, individuals, businesses, governments and whatnot. That is the most transferable example because that is an example that deals with a full on state on state war of aggression where there is a clear aggressor and a clear victory. So in many ways the Claims Commission that is being built for Ukraine models after the uncc, there will be of course significant differences, most notably in the way that it is established as it's going to be a treaty based mechanism rather than a mechanism sanctioned by the Security Council. There will be other governance elements. There will be a different approach, most notably technologically because we have the benefit of all this technology that they didn't in 1990s. But the basic premise remains the same. The premise of that is that it is not a judicial but an administrative procedure, administrative mechanism that is meant to put the existing Russian obligation to make reparations for its internationally wrongful acts into a practical context. Quantify it if you will, exactly determine how much is it that the Russian Federation owns in reparation and to whom exactly therein lies the answer to the question of what happens if Russia objects. Of course Russia objects. It has been objecting for a while now. But that does not mean that they get to evade their existing international law obligation to make reparation. And this is the basic premise. So from, from this perspective, this is a mechanism that is being built in that way as an administrative body, as an efficient body that will be equipped to deal with millions of claims. I mean, you cannot imag imagine probably a court of any state that will be able to deal with millions of claims in any meaningful time span. But this body has to, because that's its purpose. That dictates how its procedures are established, that dictates its evidentiary and procedural standards, that dictates its decision making approaches to compensation and so on and so forth. Many answers to that questions in a practical sense are not there yet because we are just at a treaty stage. And much of these answers will be delivered once the bodies of a claims commission are established and the rules are adopted and the procedures are framed. But the basic blueprint is there and we're following that.
- [52:08]
Patrick Pearsall
And two, quick follow on points just to kind of take a step back from a historical perspective. I mean we've said a lot thus far about how unique this situation is. Claims commissions generally as a concept, as a structure, that's ancient justice. I mean Grotius, not to geek out, but it is lawfare after all. I mean Grotius said the only way to win the peace is for reparations to be paid, right? Because that is necessary for peace. And hundreds of hundreds of years of precedent on claims commissions with dozens and dozens of claim commissions. Not only Victor's justice, but claims commissions in the global South. It's just many, many examples of claims commissions exist. Uncc, as Marquion noted, is the most perhaps relevant in this context. But of course there are differences there which he highlighted. But this is a very tried and true path and we are building on a body of law really that is well understood and I think can continue to be of use to the international community as we figure out what the global security apparatus post Ukraine looks like, post Ukraine conflict looks like. Right? Because we're going to have to rebuild in many ways considering what the P5 looks like these days. And then the second point, and just very quickly, is speaking for myself, I'm optimistic that Russia will participate and I'm optimistic for two reasons. One, Russia is not, not its government. It has a long history as a nation, as a people, many of whom are law loving, international law folks who want to see Russia return to its rightful place in the community as a law abiding international law actor. So that's point one, but point two and more kind of crude. Russia does not want to be sued in the capital markets of the world, right? I mean, if, if there isn't a claims commission, what do we have? We have liability for Russian actions in any number of jurisdictions throughout the world. And once you have claims brought against you in New York, in London, in Paris, and those claims move to judgment, if they are successful, Russia's monies will be tracked doggedly by folks across the world. We've seen this in the Iranian context. And what that means is there is no global peace. There is no way for Russia to return to the capital markets in a meaningful way. So I think there is an interest in Russia to ensure a process, just like Iraq did in the UNCC context, to find a way forward that gives a structure and a pathway for settling these issues in a way that won't expose them to jurisdictions throughout the world.
- [55:17]
Mikhailo Soldatenko
And just a quick follow up. So Patrick, you and Marcian, you mentioned the examples of UNCC and Ethiopia Eritrea Claims Commission and in both of those cases. So in the UNCC case there was the UN Security Council resolution, and in the Ethiopia Eritrea, there was a consent of both parties. So would it be fair to say that the main novelty of the Ukrainian case of the treaty would be that there would be only an obligation of Russia under international law to make reparations, but no consent and no binding obligation to be a part of the mechanism? And what is the legal theory to say that it doesn't matter?
- [56:04]
Marcian Klukovski
I would reframe this question a little bit. The novelty, the horrible novelty, is that this is the first time since the establishment of the UN that the permanent member of the Security Council has committed an act of aggression against another UN member? And that means that State has in principle some ability to evade the consequences of that. Now, nowhere in the international law does it say that a P5 member can do whatever it wants without consequences just because it can veto the Security Council decisions. The provision that the State responsible for internationally wrongful acts is due to make reparations, that is codified in Article 31 on articles on State responsibility, does not have that caveat, does not have that conditional. Any State that has violated international law is under duty to make reparation, and that is the heart of the legal theory behind it, is that there is no opportunity to assure impunity for itself just because the State is a permanent member of the Security Council. Every state is due to be responsible like that. So following from that, yes, that is a little bit of novelty in the sense that a claims mechanism is built without consent or participation of that state. Because in the event of this egregious act, as we say, an act of aggression, that consent is simply nowhere in international law to be seen.
- [57:45]
Patrick Pearsall
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- [57:47]
Marcian Klukovski
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Patrick Pearsall
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Marcian Klukovski
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Patrick Pearsall
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- [58:31]
Scott Anderson
So that brings us to the third part of the formula, the part that has gotten in some ways the most attention, certainly in the United States, somewhat ridiculously given how complicated the other two parts are, to say the least. And that's the question of how you actually get the funds necessary for compensation for reparations. Talk to us a little bit about what the fund is going to look like institutionally, but then the more complicated question how is it likely to be funded? We know there is are the frozen Russian assets which have been a point of contention. There's arguments in various points about concerns about expropriation and sovereign immunity violations, ideas that countermeasures might be able to overcome that. But it requires applications of countermeasures, which some people are uncomfortable with, third party countermeasures, some sort of other or affected parties claims of countermeasures. There's a lot of theories about how to adapt countermeasures to the situation, but I think it's fair to say all involve at least some element of progressive development of the law of countermeasures. And we know we've seen pushback from that from at least some major European governments that are necessary for this. Where else might the funding come from, if not from these frozen assets? And what is the timeline on that? And how does it intersect with other projects built on these assets and built on providing assistance to Ukraine, like the Extraordinary revenue acceleration loans era loans that the G7 has provided. I'm just kind of curious. Give us a big picture about where this money is going to come from, is likely to come from and the timeline that that's going to take to deliver it.
- [59:55]
Marcian Klukovski
Let me maybe start with the answer to the simple part of that question. The compensation fund itself. Frankly, there's no certainty about how exactly it will look like and where it will be situated. But in principle, there's nothing complicated about the compensation fund. The compensation fund is to keep the money and distribute it according to the decisions of the Commission. It's essentially an accounting and payment function. Of course, if a fund keeps a substantial amount of money, that money has to be managed and serviced. There has to be a framework of compliance and governance built around that. So if you ask me to speculate on that, I think that the best solution would be to place that fund with the credible international financial institution such as the World bank, for instance, or anything similar. Just purely speculating here because they are equipped to deal with that. That is simple. There have been other precedents. The national bank of the Netherlands has been tasked to keep the fund that is used for Iran US Claims Tribunal claim settlement process. There are multiple options for that, but in principle that function is simple. The really big money question is where the money money is coming from. I should start by saying that there is no clarity on that as of yet. There is a very strong consensus in the room, in the negotiating room as well that the money should come from the Russian Federation. The Russian Federation must pay for this. The rest is in many ways mechanics. Yes, with heavy political aspect of it, but nevertheless mechanics. The majority of discourse, as I said, is about frozen assets. That is not nearly the only way of doing that. Going back to uncc, we have a really good example of the alternative structure of a very manageable alternative structure where the compensation fund was filled through diversion of a share of Iraqi oil export revenue that it was required to put in the compensation fund on an annual basis started with 30% that it went to 15 and 5 and do it annually until every claimant awarded claimant is satisfied that Iraq was essentially forced into that arrangement through a heavy sanctions regime and it was a compromise where Iraq was allowed to trade oil in return of its commitment to put the share of that in the compensation fund. So from a point of view of Russia being a major energy exporter, from a point of view that Russia is dealing with a heavy sanctions regime of a different nature. But nonetheless there is premise for an attempt to replicate that same model. Especially considering that even From a point of view of Russian Federation, that would be easier than taking money out of the coffers and putting that on a table. But that requires one simple thing, cooperation of Russia, which does not exist at the moment.
- [62:55]
Patrick Pearsall
Let me say two quick things to this one. A lot of ink and a lot of, of air has been spilt and set and puffed out, I guess, on the question of immunity, right? And just to kind of circle back to that for a second, I think we are grappling with a moment where sovereign immunity as a concept is under investigation. It's under interrogation, and not in a kind of aggressive way, but as a, is it fit for purpose? Are the contours where they should be for sovereign immunity? I mean, immunities are offered and given as a privilege to other nations. This is not natural law, this is custom, right? And in the 40s, in the early late 30s, early 40s, there was no concept of holding heads of state accountable for illegal actions, right? They were immune. And then international law, the community of states responded that, well, in certain circumstances that's not, not applicable. The, the Westphalian system didn't collapse at that moment. You know, in, in the early 70s, people thought holding a state accountable and abrogating its immunity for its commercial acts would, would, would be a, a complete violation of international, you know, comedy of nations, et cetera. And, and yet almost every nation has commercial exceptions to, to sovereign immunity. And the world didn't collapse. Here we have a mult moment, right? We have a moment where a P5 member violated Article 2. 4 of the UN Charter. And we as a, as a, as a global community, hopefully need to come together to figure out how to account for that. But also what immunities are owed in that situation, right? It's a very unique situation. And also what are the non kinetic tools that we have to keep ourselves safe? What are the incentives to discipline state behavior? And that is part of the immunity conversation. It is one that is kind of fundamental to that conversation. If sovereign immunity is meant to keep nations on parity with one another and ultimately to be crude, to keep us safe, right? What is the best way to use those immunities to, to keep us safe? Now that's a, that's heart surgery, right? Or brain surgery at the very heart of the international system. So we all need to be very careful in figuring out ways forward for all the reasons that, that even Michelo suggested when he, when he pointed out the, the 74 abstentions in the UN General assembly vote, right? All of that is Swirling around. But I think your listeners certainly have a role to play here in trying to chart a course that accounts for the reality in which we're living in, which is when you violate Article2.4 of the Charter, what obligations do you have to the rest of the world to make reparations and how can the rest of the world encourage you to do that? Through evolving norms. So I think that's where we're at on that point.
- [66:17]
Mikhailo Soldatenko
So Patrick, would it be correct to say that you're basically arguing for the change in the customer international law and that's somewhat different. So my understanding was from hearing the Ukrainian representatives that their main position is countermeasures, which would assume that you need to derogate from sovereign immunity when it's there in order to induce Russia to comply with its obligation to pay reparations. So my question is, what are your thoughts on that? Do you think it should be a push for the change in the customer international law or it's better to work with a countermeasures party? And what are your thoughts on countermeasures? Because there was a lot of debate about that.
- [67:02]
Patrick Pearsall
Well, look, I think it's going to be an evolving conversation. So I'm going to dodge the question a little bit and say there are any number of legal theories that, that can hold Russia accountable for its actions without its consent. Right. Without its consent is also a little bit tricky because prior to the full scale invasion of Ukraine, Russia was a willing participant in concepts like countermeasures in these circumstances. Right. So I think it's going to be an evolving conversation. I don't want to get ahead of any of the state parties who are looking at these issues right now, now with, with Markion. But I, I do think we are at a moment where, where we need to be thoughtful about, about rebuilding, restructuring the international security framework, which I know you and Scott are both deeply interested in, as are your, your members. And part of that conversation has to be immunity.
- [67:57]
Mikhailo Soldatenko
Right?
- [67:58]
Patrick Pearsall
Part of that conversation has to be sanctions. Part of that conversation has to be all of the non kinetic tools, tools that keep us safe in a world where we have nuclear proliferation, where we have P5 members who are violating the charter.
- [68:13]
Mikhailo Soldatenko
Right.
- [68:13]
Patrick Pearsall
Like these tools need to be looked at and looked at by international law folk. And we are a little bit of the canary in the coal mine. We are, we are one of the first actors, we are one of the first things. This is one of the first international organizations to, to act in this new world that we find ourselves in really. And There'll be dozens and hundreds and hundreds more after this conflict ends because we're going to be in a whole different place. Right. And we really are at that inflection point. So I think that we just need to be careful and conservative and thoughtful about it, but nonetheless have those conversations. The other thing about this, and we've said a lot about the speed, so I encourage all of your members and all of the listeners to get out there and write articles and things because we read them, right, and be thoughtful about it. But 11 months after Marquion was in that parking garage in Kyiv listening to bombs fall, 11 months later, Marquion and I couldn't find a hotel room, but we were in a parking lot garage sleeping in Switzerland at Davos, meeting with heads of state, trying to figure out out ways to get this across the line. Eleven months later, two different versions of a parking garage. But, but that's how fast we're moving in international law right now. And I just think that we should be thoughtful about that and recognize that, that it doesn't all have to happen tomorrow. Right. And that's, that's why Martian is taking the time to do what he's doing.
- [69:49]
Mikhailo Soldatenko
So, moving to the questions of negotiations. So there were two rounds of talks recently between UKRA Russia, one in May, one in June, and parties presented their positions, including on the reparation issue. And it's, and it's basically simple. So Ukraine says that the frozen Russian assets must be used for the reconstruction or remain frozen until reparations are paid. Russia argues that it has some claims that it's ready to, to reject if Ukraine will also remove its claims to reparations. But in February this year, there were reports. It's uncertain whether that's true or not, but behind closed doors, apparently Russians are ready to consider some sort of acquiescence with using their assets. But their requirement is, and it's reportedly that they want part of it to be used for territories that they unlawfully occupy. And it sounds like a proposal of lump sum payment without further claims. Do you think the reparation initiative can be used as a bargaining chip or. That's unacceptable and should be at the red line. And what are your suggestions for the Ukrainian negotiation team on the topic of reparations?
- [71:21]
Marcian Klukovski
I don't think it would be really appropriate for me to comment on those negotiations. They are, first of all, sensitive and second of all, they are negotiations. All I will say on this is to quote one of key persons in Ukraine on the matter of reparations, Irina Mudra who serves as the deputy head of presidential office office and when she conveys Ukraine's policy on this, is that justice is non negotiable and reparations are part of justice. This is what we are all pursuing going further than, you know, just concepts of justice and values of justice in today's world. It is also a matter of rebuilding the country. It is also a matter of rebuilding the lives of individual people, giving them a sense of justice for what they had lost. So that is why it is non negotiable for Ukraine. And we see that in action. We see that in how Ukraine actively pushes these matters forward in negotiations and through other avenues. So that is the starting point of this discussion. I do believe, just having studied the compensation reparation processes of the past, let's say 80 years, that the lump sum arrangements in post war concepts are a matter of the past. Today we don't only deal in state to state relationships. In international law, individuals and legal entities are recognized as subjects that have rights under international law. It was very clearly visible through the work of UNCC where it was individual claimants who brought claims against Iraq. And we are pursuing the same model where individual claimants, both people and legal entities, bring claims against Russian Federation. And it is their entitlement, it's them who have suffered the damage because of the war and they are entitled for recovery. How that will unfold. Of course, you know, I don't have the crystal ball, like I cannot look into the future. But every indication that we have now suggests that this is, this is something that will not be negotiable. We can debate modalities, we can debate the modalities of Russian participation, which is primarily more than welcome. I mean, we would like Russia to be at the table and engage in rules based process to determine how that issue is to be dealt with. But that process has to continue otherwise the aggressor state will simply not face any consequences for this war.
- [73:56]
Mikhailo Soldatenko
Patrick, going back to you and so your optimistic take on Russia participation in the mechanism and it looks like so their position is, and it's unclear whether that's true, but the best reading of their position is lump sum payment without recognition of responsibility and no further claims. What are your thoughts on that and what is your kind of thinking and advice to the Ukrainians?
- [74:23]
Patrick Pearsall
I'm sure Russia has lots of ideas and I appreciate the question. I'm trying to make the podcast as nonachronistic as possible because anything could. I mean they can change positions daily. Here's what they need to do, in my personal view, stop bombing civilians. How about that? That's a good first step. And then we can talk about other parts of the negotiation. If you listen to President Zelensky's speech at the Council of Europe a couple weeks ago, I think you get a good sense of where things are and how Ukraine is behaving and how Russia's behaving. And you can see that in President Trump's views. You can see that in what we're hearing from Prime Minister Starme, like all of those things are contributing to this. So it is a little bit of a position in flux. But let me give Marcion the last word, because every day Marcion is trying to ensure that there's a mechanism in place for reparations, which is really, in and of itself, the thing that he's doing. And whether the thing is going to be part of a ceasefire and a settlement and whether it's going to be. Be, as you put it, a bargaining chip, I don't know. But I do know, as international lawyers, right, which is the primary audience of lawfare, we should all commend this thing, which is one of the only actual structured international organizations to come out of this conflict, that is vindicating norms that we recognize priority year to 2022.
- [76:06]
Mikhailo Soldatenko
Right.
- [76:07]
Patrick Pearsall
That deserves applause, irrespective of how we get to a ceasefire. But let me give Marcian the last word then.
- [76:15]
Marcian Klukovski
We don't know how this will unfold, and frankly, there are many ways in which it will not succeed. But we feel a duty that we've shared with Patrick and a few others back in February and March of 2022 as lawyers to do something about it, and we're following through. We have accumulated immense political support. We have almost 55 states that are at the table that will be at the table this Monday, next Monday, at the negotiating table, talking about the Claims Commission, we have world leaders saying, talking about the need to compensate Ukraine for the damage suffered through this war, and we feel calls to reinforce the international world order that has been under attack, that it has not known since the establishment of the United Nations. So all that brings us to a very practical viewpoint for an individual, for a person who has lost everything because of the war that somebody decided to wage against Ukraine. How do we help that person? How do we give that person an opportunity to respond to that injustice that is happening to them. That is impossible if you picture that little person versus the giant that the Russian Federation is. But law is the ultimate equalizer. And if the small person is on the right side of law. That person has to have a practical remedy to achieve justice, or at least take steps towards it. This is fundamentally what this mechanism is about and that's why me and my team and all others that contribute towards that and have contributed in the past three and a half years, we will never stop.
- [78:05]
Scott Anderson
I think that's a great point to wind up on. Mark, Jan Patrick, thanks so much for joining us here today on the Lawfare Podcast.
- [78:12]
Marcian Klukovski
Our pleasure. Thank you so much for having me.
- [78:17]
Mikhailo Soldatenko
The Lawfare Podcast is produced in cooperation with the Brookings Institution. You can get ad free version of this Another Lover Podcast podcasts by becoming a LaFair material supporter through our website. You'll also get access to special events and other content available only to our supporters. Please rate and review us wherever you get your podcasts. Look out for our other podcasts including Rational Security, Allies, the Aftermath and Escalation. Our latest Lawfair Presents podcast series about the war in Ukraine. Check out our written work@lawfairmedia.org the podcast is edited by Jen Pacha and our audio engineer for this episode was Kara Schillen of Goat Rodeo. Our theme song is from Alabai Music. As always, thank you for listening.
- [79:25]
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