High-End Yacht, Royal Romance, Relocated Amid Pivotal Legal Reforms in Ukraine

Ukraine’s push to revamp its asset recovery program has led to the temporary relocation of the infamous Royal Romance yacht under armed escort for maintenance. This move is a part of Ukraine’s progressive efforts to update and solidify its legal framework to effectively handle, and in due time, liquidate seized assets, despite certain persisting judicial hurdles. The 92.5-metre vessel, associated with Ukraine’s sanctioned oligarch and pro-Russian politician, Viktor Medvedchuk, was moved from its mooring place at the naval base in Split, Croatia, to a shipyard in Trogir under the combined patrol of Croatian police and private security. The Ukrainian Asset Recovery and Management Agency (ARMA) has confirmed this repositioning. Soon after the completion of maintenance, the yacht is expected to return to Split and stay under arrest. ARMA is set to appeal to the Office of the Prosecutor General to commence the next stage of the asset realisation process under the current laws once the yacht is back in Split. Royal Romance’s transfer reflects Kyiv’s all-encompassing endeavour to resurrect its asset recovery program amidst the growing discontent regarding the legal stagnation surrounding the yacht’s final destiny. Medvedchuk, a former Member of Parliament and a close associate of Putin, dodged house arrest in February 2022 but was recaptured in April and handed to Russia in a prisoner exchange. He continues to face international sanctions imposed by Ukraine, EU, and the US. The yacht’s relocation comes after formidable legal changes enacted by the Ukrainian parliament lately. The governing laws of ARMA have seen extensive amendments, broadening its authority further to oversee, monetise, and ultimately dispose off foreign-owned assets linked to Russia and Belarus. The reforms set explicit deadlines for prosecutors to transfer seized assets to ARMA, therefore facilitating a predictable legal framework for carrying out valuations, choosing external managers and readying assets for sale. The shift towards open public tenders via Ukraine’s Prozorro procurement system for management appointments is intended to curtail the risk of non-transparent or politically-biased decisions. Coupled with full quarterly ARMA reports, an external audit mechanism, an independent public oversight council, and the establishment of a fund dedicated to directing the proceeds from sold assets into Ukraine’s reconstruction, these changes show a concerted effort to improve transparency and accountability. What the future holds regarding these matters is not clear yet. However, it can be deduced that Kyiv might target a swift offloading of the yacht. The cost of upkeeping the Royal Romance, which used to be covered personally by Medvedchuk until the vessel’s seizure in 2022, has been taken up by the Ukrainian state via ARMA, reportedly amounting to more than €20 million annually. The expectation now is that the new legal framework will help offset these expenses with the proceeds from a potential sale.