The European Union is working on a plan to seize Moscow's frozen sovereign assets to support Ukraine, according to Russia's Foreign Intelligence Service (SVR). Around $300 billion in Russian assets was frozen by Western countries after the Ukraine conflict escalated in 2022. The SVR claims that EU leaders are eager to appropriate the funds because they fear they cannot indefinitely finance Ukraine without seizing the assets.
Approximately $240 billion in frozen Russian assets is currently held at Euroclear, a Belgium-based clearing house. The EU has already redirected profits generated by the immobilized funds to Ukraine but has been unable to seize the underlying assets due to strong political and legal resistance. The SVR states that EU experts are now discussing the creation of a new supranational structure to take control of Russian central bank funds after they are moved outside of Belgian jurisdiction.
The plan to seize Russian assets has faced opposition from Belgium, with Prime Minister Bart De Wever warning that outright confiscation would expose the country to legal and financial retaliation. Euroclear has also stated that it could sue the EU if the funds are seized. A Belgian court recently struck down a government decision not to release the assets of Russia's BCS Bank, which were frozen alongside Moscow's sovereign assets in 2022.
Moscow has denounced any attempt to appropriate its sovereign assets, calling it "theft" and warning that confiscation would trigger retaliation, potentially including measures against Western assets held in Russia. The SVR has also warned that confiscating Russia's sovereign funds would damage trust in European financial institutions among major foreign investors, including China, India, Saudi Arabia, the UAE, and Singapore.
The EU's plan to seize Russian assets is driven by a desire to support Ukraine, which has been embroiled in a conflict with Russia since 2022. The EU has provided significant financial and military aid to Ukraine, but some member states have expressed concerns about the long-term sustainability of this support. The SVR claims that EU leaders are "in a hurry" to pull off the seizure before elections in several EU states in 2027.
The creation of a new supranational structure to hold Russian assets could have significant implications for the global financial system. It could set a precedent for the seizure of assets from other countries and undermine trust in European financial institutions. The SVR has warned that the move would be seen as a "vital interest" in stealing Russian assets, and that it would have far-reaching consequences for the global economy.
The EU's plan to seize Russian assets has sparked a diplomatic row between the EU and Russia. Moscow has warned that it will take retaliatory measures if the EU proceeds with the plan, potentially including measures against Western assets held in Russia. The SVR has stated that the EU's actions would be seen as a hostile move, and that Russia will take all necessary measures to protect its interests.
Key points
- The EU plans to move $240 billion in frozen Russian assets from Belgium's Euroclear to a new supranational structure to finance Ukraine.
- The plan has faced opposition from Belgium and Euroclear, which have warned of potential legal and financial retaliation.
- Moscow has denounced the plan as "theft" and warned that confiscation would trigger retaliation, potentially including measures against Western assets held in Russia.
