EU finally decides to indefinitely freeze Russia’s frozen assets
12 December 22:07
The EU states have decided by a majority vote to indefinitely ban the return of funds frozen in the EU to Russia, Denmark, which holds the EU presidency, said on Friday, December 12. This will create a legal basis for the use of Russian state property in favor of Ukraine, "Komersant Ukrainian" reports citing DW.
The decision, adopted by written vote, will exclude the possibility that any of the EU countries, such as Hungary or Slovakia, could use a veto on EU sanctions decisions to unblock Russian assets. Currently, the Central Bank of Russia’s funds are frozen by EU sanctions, which must be unanimously renewed every six months.
The condition for the return of funds
This design is considered an obstacle to the plan to provide Ukraine with long-term loans from the proceeds of Russian assets and to allow the return of these funds to Russia only if it pays reparations to the country after the end of its aggression against Ukraine. To freeze Russian assets indefinitely, Germany and other EU countries rely on Article 122 of the Treaty on the Functioning of the European Union. It provides for measures to be taken by a qualified majority in the event of serious economic difficulties.
The draft EU legal act states that Russia’s war against Ukraine continues to pose serious economic challenges, and the transfer of funds to Russia should be prevented as soon as possible to limit the damage to the EU economy. The document is expected to be adopted before the EU summit next week.
Belgium’s position
At the moment, German Chancellor Friedrich Merz and other supporters of the initiative hope to convince Belgian Prime Minister Bart de Wever to join the plan to use assets for loans to Ukraine. Without Belgium’s support, implementation is considered extremely difficult, as the vast majority of the Russian funds to be used are managed by the Belgian company Euroclear. It is about 185 billion euros out of 210 billion euros placed in the EU.
The Belgian government has so far blocked the plan, pointing to legal and financial risks. Among other things, it fears that Russia may retaliate and expropriate European individuals and companies. Prime Minister de Wever had previously put forward three conditions under which Belgium would be ready to support the initiative, despite the possible risks. He demanded that all EU countries share the responsibility for possible risks and ensure that sufficient financial guarantees are in place from the first day of the plan’s implementation to meet potential liabilities.
In addition, it insists on comprehensive liquidity and risk protection for all citizens and companies affected by the plan, as well as the participation of all EU states in whose territory the assets of the Central Bank of Russia are frozen. According to the European Commission, in addition to Germany, they are located in France, Sweden and Cyprus.
