Withdrawal of 100mm-caliber-and-over heavy weaponry from the line of contact separating Kiev-led forces and Donbas militias in eastern Ukraine was one of the key provisions of the February Minsk agreement, as well as a ceasefire between the warring sides.
"OSCE monitors have witnessed yet more violence resulting in the injury and death of civilians and combatants, as well as the destruction of housing and other infrastructure," Hug told reporters.
"Moreover, there is reported use by all sides of heavy weapons, including 122mm and 152mm caliber artillery," he added.
According to Hug, the OSCE has also recorded less military hardware at storage facilities of both Kiev-led forces and eastern Ukrainian militia than claimed.
Despite several rounds of peace talks and a February ceasefire agreement, fighting in eastern Ukraine, which started in April 2014, continues. According to UN estimates, over 6,800 people have been killed in the conflict.
Earlier in August, the warring sides were due to sign a deal on the withdrawal of weapons with a caliber of less than 100-mm from the line of contact in Donbas, stipulated by the so-called Normandy Quartet in July.
However, a source in the talks said that Kiev refused to remove its weaponry from four specific areas, while the militias demanded that the entire line of contact be cleared of such weapons.