Symposium on PMSCs: Ukraine’s New Bill on PMSCs – A Possible Pandora’s Box for Operations Abroad?

[Darío Bürky Arellano holds an MA in International Law from the Geneva Graduate Institute]

On 6 May 2025, a new bill was presented to the Verkhovna Rada of Ukraine: the “Draft Law on International Activities of Private Law Legal Entities in the Military and Security Spheres” (“Draft Law on PMSCs”). The proposal was referred to the parliament’s Committee on National Security, Defense, and Intelligence, and seeks to regulate the activities of private military and security companies (PMSCs), as well as to establish specific state requirements for providing these services both within and outside Ukraine to strengthen the country’s role in the global security market. In this manner, Ukraine is now aiming to regulate its PMSCs industry, which in developed countries like the USA is expected to reach a market value of USD 457.3 billion by 2030. This bill is pending parliamentary discussion in the Verkhovna Rada, but it is worthwhile to analyse its current state and potential challenges.

This article aims to assess the Draft Law on PMSCs from the perspective of international law and legal critical analysis, focusing on how its provisions may affect the regulation, accountability, and oversight of overseas operations of PMSCs based in Ukraine. This timely discussion is also influenced by the persistent inability at the international level to reach consensus on crucial topics of PMSC governance. While this bill considers Ukraine’s national context, this analysis concentrates on its regulatory implications, rather than the internal political and security situation. It is important to clarify that the author does not speak Ukrainian and therefore relied on translation tools to read the bill. 

PMSCs on the Rise: Controversial Services

The PMSC industry has become more relevant than ever as its services have grown and diversified exponentially across regions and types of operations. A major ongoing debate surrounding PMSCs concerns the risks of international humanitarian law (IHL) and human rights violations due to insufficient transparency, oversight, and accountability mechanisms. The outsourcing of security services could result from limited internal capacities, inefficient or insufficient capabilities to ensure public security, or the need for highly customized protection measures. In certain contexts, PMSCs are also used to support states’ political or economic interests in specific territories while avoiding direct involvement, scrutiny, and accountability.

Each region around the world features unique dynamics and threats in the provision of security services. In the Americas, countries like Guatemala and Ecuador, the diversion of firearms and ammunition to black markets is posing a spreading danger to security and stability, and so is the influence that organised criminal groups are exerting in their formation and illegal operations. In Europe, PMSCs are involved in the highly-profitable business of border control by supplying surveillance technologies, equipment and IT infrastructure, affecting the right to privacy of migrants on the move. In Africa, PMSC activities are substantially more complex and involve a variety of actors. For instance, the operations of the Wagner Group (now in its post-Prigozhin era, with increasing State control and diversification into a ‘military-business complex’, including different PMCs such as Africa Corps, Redut, and Convoy) has been reported of conducting resource exploitation, disinformation campaigns, training and security partnerships with different governments and non-state actors. Additionally, among lower-profile players, Turkish PMSCs such as SADAT, are reportedly involved in the arms market and military training to non-state actors aligned with their interests, showing a low-key but steady rise in Africa. In the Middle East, the US-based PMSC UG Solutions has reportedly been operating in Palestine to manage checkpoints in the Gaza strip, operating in a major volatile environment.

Threats posed by PMSC operations are often difficult to define, as each region has its own distinctive features, and Ukraine is no exception. The country’s Draft Law on PMSCs was developed in the context of the crime of aggression committed by the Russian Federation, its invasion of the Donetsk and Luhansk regions, the ongoing state of war, and the recent agreement between Ukraine and the USA. There are clear grounds to expect that Ukraine will pursue an accelerated increase in PMSCs operations and thus encounter significant oversight challenges in regulating this industry effectively. These challenges will be the main focus of this piece. It is important to note that this is not in opposition to Ukraine’s need to undertake all necessary measures, in strict compliance with international and domestic law, to defend its territorial integrity, safeguard the life of its population, and seek lawful revenues.

Regulation of PMSCs at the International Level

There is currently no regulation of PMSCs at the international level with a binding effect. Initiatives such as the Montreux Document and the International Code of Conduct for Private Security Services Providers are “soft law” instruments without binding force and do not explicitly prohibit direct participation in hostilities (“DPH”) by PMSCs. The reality nowadays is that PMSCs are involved in armed conflict, posing significant risks of IHL and human rights violations.

In this framework, the UN Human Rights Council established a new Open-ended Intergovernmental Working Group (IGWG) on PMSCs in 2017. The IGWG has been working for almost seven years and has not yet produced a comprehensive instrument that effectively regulates this industry with provisions that go beyond existing human rights and IHL frameworks. Its underperformance and lack of results may have several reasons: Evident crisis of multilateralism, fatigue within UN processes, extensive criticism by and among States, and lack of unwavering commitment. Additionally, States involved in the negotiations appear unwilling to ensure a binding instrument and currently have no clear roadmap for how an effective, legally binding proposal could be operationalized. Lastly, and related to the negotiations themselves, there is no agreement and even reluctance to regulate whether PMSCs should be allowed to engage in DPH.

The last point has a direct impact on national laws if no international agreement on PMSCs is reached. Ukraine’s Draft Law on PMSCs proposes that PMSCs can exceptionally support the military in responding to threats and acts of aggression against the territorial integrity of Ukraine and ensure national security under “exceptional circumstances”, as well as during overseas operations. This piece will strictly focus on the participation of PMSCs in armed conflict and will argue that the lack of international agreements leaves a risky opening for states to interpret how this industry may operate.

The Use of PMSCs in Armed Conflicts

IHL does not prohibit the use of PMSCs in direct hostilities but encompasses only the following two aspects: PMSC personnel retain the status of protection as civilians (when they are not DPH) and an occupying power is obliged to manage every prisoner-of-war camp and internment of civilians without outsourcing to private entities. Beyond these provisions, there are no other exceptions to use PMSCs in armed conflict under IHL.

The Draft Law on PMSCs reaffirms that PMSCs must comply with IHL when deployed in and outside of Ukraine. In its territory, the use of special means, firearms, weaponry, and military equipment (“armed force capabilities”) by PMSCs can only be deployed under “exceptional circumstances” when: 1) there is a decision from a military command; 2) during martial law or state of emergency; 3) necessary to avert a threat, repel armed aggression against Ukraine and ensure national security or eliminate threats to Ukraine’s state independence and territorial integrity; and 4) in the zone of the Joint Forces Operations in territories with active hostilities or in temporarily occupied territories. When reading Article 7(3), and Article 8(2), the requirements are cumulative, meaning that if any one of the requirements is not fulfilled, PMSCs in Ukraine cannot use armed force.

With respect to operations outside Ukraine, Article 8(1) allows the use of armed force also in “exceptional circumstances” but defers this determination to the laws of the state where PMSCs operate. The provision also requires that: 1) the use of armed force capabilities is strictly confined to the territory of that State; 2) they are exclusively for, and within the scope of, providing services defined in Article 7; and 3) all activities comply with the Draft Law on PMSCs, IHL, and the laws of that State.

A further limitation appears in Article 8(5), which prohibits PMSCs from “directly participating in combat operations in the territory of other countries”. Nevertheless, this provision raises conceptual ambiguities. First, it is unclear whether the use of armed force capabilities constitutes DPH under IHL, or whether these activities fall short of that threshold. Second, while DPH is a recognized concept under IHL, combat operations is not a legally defined term in this body of law, further complicating interpretation. This distinction also poses risks because of the vagueness between defensive and offensive combat operations which in practice may also be instrumentalized.

Further definitions of armed force capabilities can be found from Articles 11 to 14 of the Draft Law on PMSCs. For instance, on the use of special means, Article 11(5) establishes that PMSCs, after fulfilling certain requirements, have the right to “repel attacks on deployment sites, convoys, and separate transport vehicles, other equipment of entities engaged in [PMSC] activities and on facilities they guard, special cargo, and their unblocking”. In this scenario, a PMSC could repel attacks if the objective of a party to the conflict aims to destroy the deployment site protected by them. Such actions could constitute DPH for defensive purposes. Indeed, under IHL, the threshold for qualifying conduct as DPH is not inherently linked to the materialization of harm but rather the plausibility that the act will result in such harm, even if the participation is for defensive purposes. As a consequence, the application of Article 8(1) and (5) creates functional grey zones, particularly regarding the permissibility of defensive use of force by PMSCs abroad that amount to DPH.

The Draft Law on PMSCs also limits the use of armed force capabilities in Ukraine under strict cumulative requirements, whereas their use abroad is substantially more flexible with the determination of “exceptional circumstances” deferred to the jurisdiction of the territorial state, which might have weaker regulations. This is especially risky, as few states have a detailed legal framework regulating armed force capabilities similar to the Draft Law on PMSCs, and even fewer have regulations that explicitly prohibit the participation of PMSCs to DPH, or a comprehensive regulatory framework at all.

Certainly, while the current Draft Law on PMSCs does not violate international law, it poses significant risks of potential violations of IHL and human rights. To date, there are no international or substantial national cases holding PMSC personnel accountable for such violations. Exceptionally, Al Shimari, et al. v. CACI and Abtan, et al. v. Prince and Albazzaz, et al. are some of the few cases where accountability against PMSC personnel has been pursued. However, the lack of accountability does not mean that violations of IHL and human rights are exceptional. For instance, Dyck Advisory Group, a South African PMSC, is accused by a series of witnesses of directing machine-gun fire at civilian infrastructure and indiscriminately dropping explosives from a helicopter, failing to distinguish between civilian and military targets. The Wagner Group operating in Mali is also accused of arbitrary executions, forced disappearances, looting and arson, and gender-based violence in 2022. Additionally, the Wagner Group’s operations in Ukraine have long been reported as killing civilians and participating in the Russian invasion of Ukraine.

The cases in South Africa, Mali, and Ukraine preliminarily fulfilled the preconditions of the International Criminal Court to exercise jurisdiction. However, no investigation against PMSC personnel has been initiated by the Court. Even in countries like South Africa where the legal framework contemplates special provisions for applying its regulations beyond its border, no steps have been taken to prosecute alleged violations against civilians. In the case of Ukraine, serious accountability gaps remain, as there is no clear legal provision ensuring extraterritorial application of the Draft Law on PMSCs.

The aforementioned examples, along with dozens of other cases, illustrate that prosecution, accountability, and oversight of PMSC activities during armed conflicts or violent environments are extremely difficult. This is partly due to the challenge of identifying PMSC personnel during deployments by the local population, as well as difficulties in reporting violations to competent authorities, since these actors commonly operate with secrecy and opacity.

Conclusion

While the Draft Law on PMSCs does not, in its current form, violate international law, it introduces significant regulatory ambiguities, particularly regarding the use of armed force capabilities and DPH outside Ukraine, producing potential unforeseen consequences. By permitting broader discretion abroad than nationally, the bill risks enabling operations that may in practice constitute DPH, without adequate regulation, safeguards or accountability mechanisms. This asymmetry in the requirements reflects the broader failure of international initiatives to effectively regulate this industry globally.

Those challenges are not theoretical. Despite documentation of abuses by PMSCs in conflict zones and high-risk environments, prosecution of IHL and human rights violations remain the exception rather than the rule. The lack of clarity in international law, due to political reluctance to prohibit corporate actors from DPH, continues to shape blurred domestic frameworks. The stationary progress of the IGWG on PMSCs illustrates the need for stronger normative clarity, steady commitment, and a binding instrument.

As Ukraine positions itself within the global security market, it has an opportunity to model a regulatory approach that avoids perils seen elsewhere PMSCs operate. This requires not only aligning domestic law with international law, but also clarifying conceptual ambiguities and operational grey zones that could be instrumentalized in extraterritorial contexts. In the absence of such reforms, the Draft Law on PMSCs risks contributing to the normalization of opaque and unaccountable PMSC operations with consequences that would be borne by civilians.