Automatic collection of debts from Ukrainians: who is at risk

Ukraine is considering revising its debt collection mechanism. The authorities intend to introduce an automated system that will prohibit any transactions involving debtors’ property, such as sales, donations, or re-registration, until their obligations are fully repaid. Corresponding changes are included in draft law No. 14005, which has already passed the first reading in the Verkhovna Rada.

According to the document, all restrictions and their cancellation will occur without human intervention — the system will automatically record the debt repayment and exclude the debtor from the register upon closing the obligations.

This draft law does not introduce new regulations regarding the collection of debts for a single dwelling or the mass sale of real estate — such provisions are already in force under the law “On Executive Proceedings” and will not change. The main novelty is the automation of the process and the temporary blocking of property disposal options until the debt is paid off, without the need for forced sales.

The main goal of this initiative is to make it impossible for debtors to hide assets by transferring them to relatives or selling them before the seizure. For this, it is provided:

Unification of the automated system of executive proceedings with state registers, databases of the Ministry of Internal Affairs, as well as banking and payment systems;
improvement of the Unified register of debtors and its synchronization with the databases of notaries and state registrars;
The introduction of automatic restrictions on the alienation of movable and immovable property before the fulfillment of debt obligations.
In other words, if a person is entered in the register of debtors, he will not be able to sell, gift, or re-register his property until he repays the debt. After the performer enters information, restrictions are automatically activated. However, the debtor can use the property, but does not have the right to enter into agreements with it.

When the debt is paid, the system will automatically record this information, generate an appropriate message, and automatically remove the person from the register of debtors.