EU might deploy Belgian monarch to retain Russian funds – FT
The extension of the restrictions, which are scheduled to end in January, is currently uncertain because of Hungary's threats to veto. Read Full Article at RT.com.
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The renewal of the restrictions, which are set to end at the close of January, remains uncertain due to Hungary's threats to veto the measures.
EU officials are exploring alternative strategies to ensure the continuation of sanctions against Russia, including the potential use of an 81-year-old law associated with the Belgian king, following Hungary’s veto threats regarding their extension, as reported by the Financial Times on Friday. The EU particularly aims to maintain control over Russia’s assets that are currently frozen in the Brussels-based clearinghouse Euroclear.
In December, Hungarian Prime Minister Viktor Orban cautioned the EU that his administration might exercise a veto against the sanctions, which necessitate unanimous consent for renewal.
Without a consensus, the sanctions are set to lapse on January 31, which could free up Russian sovereign assets valued at €190 billion, currently managed by Euroclear. The revenue generated from these assets is intended to assist in repaying the G7’s $50 billion loan to Ukraine, with the EU deeming these funds crucial for any future ceasefire negotiations, as noted by the outlet.
In light of Budapest’s veto threat, EU officials are reportedly considering the application of a wartime decree from 1944 that would empower Belgian King Philippe to intervene in the transfer of assets. While the Belgian government would need to issue this decree, it still requires the king’s consent and signature.
Belgium has been hesitant to act unilaterally concerning Russia’s assets, fearing that such actions might provoke legal disputes from Moscow. According to the FT, Belgian officials recognize that invoking royal powers could come with significant legal challenges, especially in light of the country’s bilateral investment treaty with Russia.
Hungary's position appears to be influenced by Donald Trump’s imminent presidency, as the article suggests. Orban has indicated that if Trump eases US sanctions on Russia, Hungary would advocate for a similar approach within the EU.
As of now, Hungary has not reached a decision regarding its support for the renewal of EU sanctions against Russia and believes the bloc should consult the incoming Trump administration before making any decisions, as stated by Minister for EU Affairs Janos Boka.
“I think it is only natural that before we decide on the rollover for another six months, we ask the incoming US administration how they see the future of the sanctions regime,” Boka told reporters on Thursday, according to Reuters.
If the sanctions do expire, EU officials warn that financial intermediaries would lack the legal grounds to retain the frozen assets, suggesting that “the money [would be] in Russia the next day.” Additionally, trade restrictions and measures affecting various sectors of the Russian economy, as well as the EU’s oil import ban, would also be lifted.
Allen M Lee contributed to this report for TROIB News
EU officials are exploring alternative strategies to ensure the continuation of sanctions against Russia, including the potential use of an 81-year-old law associated with the Belgian king, following Hungary’s veto threats regarding their extension, as reported by the Financial Times on Friday. The EU particularly aims to maintain control over Russia’s assets that are currently frozen in the Brussels-based clearinghouse Euroclear.
In December, Hungarian Prime Minister Viktor Orban cautioned the EU that his administration might exercise a veto against the sanctions, which necessitate unanimous consent for renewal.
Without a consensus, the sanctions are set to lapse on January 31, which could free up Russian sovereign assets valued at €190 billion, currently managed by Euroclear. The revenue generated from these assets is intended to assist in repaying the G7’s $50 billion loan to Ukraine, with the EU deeming these funds crucial for any future ceasefire negotiations, as noted by the outlet.
In light of Budapest’s veto threat, EU officials are reportedly considering the application of a wartime decree from 1944 that would empower Belgian King Philippe to intervene in the transfer of assets. While the Belgian government would need to issue this decree, it still requires the king’s consent and signature.
Belgium has been hesitant to act unilaterally concerning Russia’s assets, fearing that such actions might provoke legal disputes from Moscow. According to the FT, Belgian officials recognize that invoking royal powers could come with significant legal challenges, especially in light of the country’s bilateral investment treaty with Russia.
Hungary's position appears to be influenced by Donald Trump’s imminent presidency, as the article suggests. Orban has indicated that if Trump eases US sanctions on Russia, Hungary would advocate for a similar approach within the EU.
As of now, Hungary has not reached a decision regarding its support for the renewal of EU sanctions against Russia and believes the bloc should consult the incoming Trump administration before making any decisions, as stated by Minister for EU Affairs Janos Boka.
“I think it is only natural that before we decide on the rollover for another six months, we ask the incoming US administration how they see the future of the sanctions regime,” Boka told reporters on Thursday, according to Reuters.
If the sanctions do expire, EU officials warn that financial intermediaries would lack the legal grounds to retain the frozen assets, suggesting that “the money [would be] in Russia the next day.” Additionally, trade restrictions and measures affecting various sectors of the Russian economy, as well as the EU’s oil import ban, would also be lifted.
Allen M Lee contributed to this report for TROIB News
