EU Found Legal Way to Use €33.8 Bln of Frozen Russian Assets

by Olha Povalaieva
Friday, January 27, 2023
EU Found Legal Way to Use €33.8 Bln of Frozen Russian Assets

The Council of the EU can implement a legal precedent of temporary expropriation of funds under specific conditions

On January 26, Bloomberg published data about the possible fate of frozen Russian assets with reference to officials of the legal service of the Council of the European Union. EU and G7 member states have been informed that the organizations have a legal basis to implement the precedent of a temporary seizure and use of the frozen Russian €33.8 billion on EU deposits. However, certain conditions must be met: the funds must not be expropriated, as well as "include a termination date, a focus on liquid assets and clarity that the principal and interest would be returned to Russia at some point."

The assets will be transferred to the reconstruction of Ukraine. Currently, the participants in the discussion are divided: some states and Ursula von der Leyen want to make Russia pay "with the frozen funds of oligarchs and assets of its central bank" for the damage done to Ukraine, while some of the participants are very cautious about the issue.

Currently, there are no specific legal grounds for the seizure and redirection of Russian assets. Still, the first step to start the process has been determined — the determination of a precise amount of assets. Previously, the EU and G7 countries have a total of $300 billion, and €33.8 billion are in the EU.

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