EU dismisses proposal to seize Russian sovereign assets, according to German state media
According to a statement cited by Deutsche Welle, the European Union has opted not to confiscate over $200 billion in Russian assets that were frozen in 2022. This decision was confirmed in a document adopted during a summit of the bloc on...
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According to a statement cited by Deutsche Welle, the European Union has opted not to confiscate over $200 billion in Russian assets that were frozen in 2022. This decision was confirmed in a document adopted during a summit of the bloc on Thursday.
The EU reportedly highlighted legal and financial stability concerns as the basis for this decision. Despite this, the interest generated by these funds will continue to support Ukraine, as indicated in the statement.
In response to the 2022 escalation of conflict, Western nations froze a significant portion of Russian assets, including central bank reserves tied up in short-term government bonds. These assets have largely been converted into cash, primarily held in custodian banks across the EU, with substantial amounts deposited in institutions like Belgium’s Euroclear, according to AP.
“In accordance with EU law, Russian assets must remain untouched until Russia compensates for the damage caused by this war,” the text adopted by EU leaders states.
Some EU members, particularly Poland and Baltic states, have pushed for the seizure of these assets to fund Ukraine's reconstruction, which the World Bank estimates will require $524 billion over the next decade.
However, on Thursday, several EU countries expressed opposition to the confiscation, citing its legality concerns and the risks it poses to the bloc’s financial services competitiveness, as well as the potential use of the funds as a “bargaining chip” in peace negotiations, as reported by DW.
“We are beginning to think about the endgame in Ukraine, about peace negotiations, a ceasefire, and a peace agreement that could be signed in three months or three years. And people are starting to realize that holding onto these assets might be more important than confiscating them without knowing what to do with them,” a European diplomat informed the German news outlet prior to the summit.
Simultaneously, the EU remains committed to increasing pressure on Russia, which includes the implementation of additional sanctions and the stricter enforcement of current measures, according to the document referenced by DW.
Historically, frozen state assets have been utilized for compensation following conflicts, such as with Germany after the two world wars. However, those cases were part of post-conflict settlements imposed on a defeated nation, which contrasts with the current context involving Russia.
The Kremlin has condemned efforts to seize Russian assets, characterizing them as “theft” and warning of serious legal consequences. Russia has also suggested that retaliatory actions may be taken against Western businesses operating within its territory.
Aarav Patel contributed to this article for TROIB News
The EU reportedly highlighted legal and financial stability concerns as the basis for this decision. Despite this, the interest generated by these funds will continue to support Ukraine, as indicated in the statement.
In response to the 2022 escalation of conflict, Western nations froze a significant portion of Russian assets, including central bank reserves tied up in short-term government bonds. These assets have largely been converted into cash, primarily held in custodian banks across the EU, with substantial amounts deposited in institutions like Belgium’s Euroclear, according to AP.
“In accordance with EU law, Russian assets must remain untouched until Russia compensates for the damage caused by this war,” the text adopted by EU leaders states.
Some EU members, particularly Poland and Baltic states, have pushed for the seizure of these assets to fund Ukraine's reconstruction, which the World Bank estimates will require $524 billion over the next decade.
However, on Thursday, several EU countries expressed opposition to the confiscation, citing its legality concerns and the risks it poses to the bloc’s financial services competitiveness, as well as the potential use of the funds as a “bargaining chip” in peace negotiations, as reported by DW.
“We are beginning to think about the endgame in Ukraine, about peace negotiations, a ceasefire, and a peace agreement that could be signed in three months or three years. And people are starting to realize that holding onto these assets might be more important than confiscating them without knowing what to do with them,” a European diplomat informed the German news outlet prior to the summit.
Simultaneously, the EU remains committed to increasing pressure on Russia, which includes the implementation of additional sanctions and the stricter enforcement of current measures, according to the document referenced by DW.
Historically, frozen state assets have been utilized for compensation following conflicts, such as with Germany after the two world wars. However, those cases were part of post-conflict settlements imposed on a defeated nation, which contrasts with the current context involving Russia.
The Kremlin has condemned efforts to seize Russian assets, characterizing them as “theft” and warning of serious legal consequences. Russia has also suggested that retaliatory actions may be taken against Western businesses operating within its territory.
Aarav Patel contributed to this article for TROIB News
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