The war has caused severe losses to Ukrainian businesses: destroyed real estate, production lines, equipment, vehicles and inventory. To obtain compensation or recover damages in court, their amount must be documented in a report prepared by an independent valuer.
The Kanzas company performs war damage valuation in accordance with the Methodology for Determining Harm and the Amount of Damages, approved by the joint order of the Ministry of Economy of Ukraine and the State Property Fund of Ukraine dated 18 October 2022, No. 3904/1223. This Methodology is mandatory for valuing damages caused to parties affected by the war. Our reports have already passed review by the State Property Fund of Ukraine — for both state-owned and private enterprises.
You can learn more about the valuation procedure and the required documents from this video interview with Liudmyla Klochenok, an experienced expert valuer:
What the valuation of actual damages determines
The amount of actual damages is calculated as the difference between the value of the property before and after the harm was caused (Section III of the Methodology). The pre-damage value is taken at the level of the market value and/or the depreciated replacement cost of similar property before the hostilities began; the post-damage value reflects the degree to which the surviving elements remain usable. Economic (external) obsolescence is disregarded: the valuation measures the harm caused by military operations, not market conditions.
Assets covered
The Methodology covers all principal classes of business property:
- real estate — buildings, structures, transmission facilities → war damage valuation of real estate;
- movable property — machinery and equipment → war damage valuation of equipment;
- wheeled vehicles and special machinery → war damage valuation of vehicles;
- inventory and biological assets → war damage valuation of stock and goods;
- integral property complexes of enterprises.
Purposes of the valuation (para. 5 of the Methodology)
- determining damages within criminal proceedings;
- filing compensation claims;
- filing lawsuits, including class actions, with courts — including international ones;
- claims brought by the State of Ukraine before international judicial bodies.
A report by the Kanzas company is prepared to be suitable both for national procedures and for international courts: where required, the valuation is performed simultaneously under Ukrainian law and International Valuation Standards.
Where the work begins
The first step is providing the valuer with a list of the damaged and destroyed property. This list determines the level of detail of the subsequent information request and the budget of the engagement.
The required information falls into two blocks.
General information (regardless of the asset list): the fire report; an extract from the Unified Register of Pre-Trial Investigations; the demining certificate; technical inspection reports prepared by the enterprise itself, by municipal commissions or — for state and municipal property — by the relevant ministries and agencies.
Detailed information for each asset:
- real estate: title documents, extracts from the State Register of Property Rights, technical passports, documents confirming ownership or lease of the land plots, and a technical inspection report for each individual property;
- vehicles: state registration certificates, inspection and damage description reports;
- equipment, inventory and other tangible assets: inventories, inspection reports or opinions of experts of the Ukrainian Chamber of Commerce and Industry.
Photographs of the damaged or destroyed property taken immediately after the destruction or upon return from occupied territory are also valuable; where needed, the Kanzas company carries out the photographic documentation itself.
Timing and deliverable
Damage valuation takes time, and its speed directly depends on the quality of the documents and information provided by the client. The deliverable is a damage valuation report with all supporting documents, ready for filing for compensation, in court or for review.
If the damage forced the business to stop or curtail its operations, the loss of profit is assessed separately. If reconstruction is on the agenda, a reinstatement needs assessment is performed.
We know what stands behind every engagement: halted operations and the wait for compensation. We offer report quality that withstands review, realistic timelines and an individual approach to every asset list. Write to us by email or messenger — we will discuss your case and prepare a fee proposal.
FAQ
Is Methodology 3904/1223 mandatory? Yes, for valuing damages caused to parties affected by the war.
How long does the valuation take? It depends on the asset list and the completeness of the documents.
Who can commission it? Enterprises, institutions and organisations of all forms of ownership.
