Explainer: How will the West use Russia’s frozen assets?
The European Union is expected to move closer to seizing profits from approximately 0 billion worth of Russian assets frozen since the invasion of Ukraine in February 2022. EU leaders aim to send confiscated money to Ukraine, facing complex legal challenges. Options include siphoning off proceeds from matured assets held mainly in Euroclear, confiscating Russian reserves under international law, issuing “reparation bonds” tied to war reparations from Russia, and arranging a syndicated loan where allies could use frozen assets to pay off loans if Moscow refuses to pay damages. The EU estimates it could send Ukraine 2.5 to 3 billion euros annually from seized profits. Belgium plans to send 1.5 billion euros to Ukraine immediately from taxed profits. Euroclear will retain a portion of the profits for operational and litigation costs. There are concerns about potential legal challenges from Russia and the impact on international asset holdings in Europe.