War damages: The Ukrainian Space company with a novel approach to making Russia pay €530m
Vitaly Kucherenko is the general director of CheZaRa, a Ukrainian Space telemetry company that used to employ 15,000 people. Now it employs barely 300 and he claims Russia is to blame. However, Kuchurenko has a somewhat novel approach to rebuilding his company. His story starts in 2014...
Crimea: a turning point
"There was a time when they had no space industry without us".
Kucherenko says that CheZaRa used to be so important to the Russian space industry that after 2014, when employees unanimously decided to stop providing their technology in light of the illegal annexation of Crimea, the number of accidents surrounding launches of Russian spacecraft increased.
But, that decision led to heavy losses for the Chernihiv-based company, which has been in business for more than six decades: it lost more than 86% of its gross revenue.
But, the decisive economic setback came nearly a decade later with Russia's full-scale invasion of Ukraine.
In April 2022, the Russian army laid siege to Chernihiv for a month. The New Yorker described the offensive as "an urban deathtrap."
"After the airstrikes and shelling of the plant, most of the buildings were destroyed," says Kucherenko, who believes that Russia, knowing his company's potential, aimed to destroy the plant, among other things.
CheZaRa had been working, in Kucharenko's words, "in all international programs conducted by other states. For example, there were NASA programs. In collaboration with NASA we worked for the Sea Launch programme of the United States." The company was manufacturing telemetry apparatus for spacecraft; so equipment to produce digital or science data.
"The equipment was damaged, the entire infrastructure, technical networks, power supply... were completely destroyed," Kucherenko added. "It is almost impossible to work in such an enterprise. Therefore, now there are only the critical professions that ensure order and the preservation of property that are still available."
Of CheZaRa's 15,000 employees, only about 300 remain. Kucherenko estimates losses run to €530 million, which he believes he can recover through the courts, despite Russia's refusal to pay reparations.
A creative legal approach
Kucherenko wants to collect the money from Western companies that used to do business with Russia and are unable to pay their debts to the country because of international sanctions.
"Russia is not ready to pay reparations, it is not ready to pay damages. But there are companies, states that owe Russia money or other things, because it is not forbidden under international law to assign these debts under an assignment agreement. These ordinary European companies and states can pay us at the expense of a debt they owe to Russia."
To achieve this, CheZaRa must first take the case through Ukrainian courts and win. Then, the judgement must be recognised in the countries where the company wants to claim money: Italy, Germany, Poland and France.
Hurdles to overcome
Experts believe this is possible, but there is one major obstacle: state immunity.
"There is a widespread notion that states are equal, so the courts of one state cannot take action against another state," Holger Hestermeyer, Professor of International and EU Law at King's College London, told Euronews.
"This usually means that in cases where another country is sued, that country asserts its immunity and the case is over. Now the immunity is no longer absolute."
CheZaRa's lawyers argue that Russia is exempt from immunity because of a UN resolution that says immunity does not apply if a country seriously violates internationally-guaranteed fundamental freedoms and human rights.
Hestermeyer explains that this is not the first case in which an investor has obtained a judgment against Russia and then claimed the money by searching worldwide for its business assets.
"None of this will be easy," he acknowledged. "And there will be incredibly high hurdles along the way. And it's not necessarily likely that they will prevail. But so far, Ukraine has also very carefully crafted a legal strategy. And I wouldn't say from the outset that there's no chance at all."
"CheZaRa has always been a pioneer on many issues," Kucherenko claims. "I think our lawyers will be at the forefront of this as well."
He adds, "If it does not work, we will wait, like everyone else, for the victory of Ukraine... and reparations."