In a crucial week for the European Union to decide how to use frozen Russian assets to finance Ukraine in its war against Russia, the Russian Central Bank on Monday filed a lawsuit in the Moscow arbitration court against Euroclear, the Belgian company depositing these funds. The Russian monetary institution denounced the company for the damage caused by the “direct or indirect” unauthorized use of the 193.7 billion euros in blocked assets, according to the Russian agency Tass. The EU approved last Friday freeze in perpetuity frozen funds of the Bank of Russia.
Faced with threats from Russia, Economy Commissioner Valdis Dombrovskis assured that the EU had developed a “A legal shield with solid measures “compliant with international and European law” to respond to Vladimir Putin’s attacks.
However, doubts are growing about the possibility of using the solution to the freezing of Russian assets to finance Ukraine through a reparation loan. So far, Belgium, where Euroclear is headquartered, has vetoed its use due to the legal consequences for the company and the country. Belgium has insisted on finding other solutions or for the other 26 EU countries to put in place strong legal measures to share risks in the face of legal threats from Russia.
The problem for the European Commission is that more and more countries are beginning to doubt the use of frozen Russian assets. Last Friday, Italy, Malta and Bulgaria also expressed caution over the use of these assets and urged the European Commission to “continue exploring and discussing alternative options.”
The head of European diplomacy, Kaja Kallas, admitted this Monday that “More and more difficult” negotiations on Russian assets, although he insisted that this week’s European Council “you will not leave until you have obtained a result”.
Spanish Foreign Minister José Manuel Albares said he was convinced that “solutions can be found to use these resources,” referring to Russian assets. “I want to remind you that the freezing of assets is a decision that we took together at 27. I do not see why we could not find a solution to move this formula forward. It is vital for Europe, for our security and our sovereignty to urgently find sustainable and predictable financing for Ukraine in the next two years.”
A spokesperson for the European Commission assured this Monday that Brussels had on the table “two fundamental solutions to provide the necessary financing to Ukraine for the next two years. One consists of a joint loan using the available margin and the other is the use of Russian sovereign assets immobilized under the jurisdiction of the EU. Six legal initiatives have already been presented to speed up the procedures. Negotiations are now underway so that discussions between the countries reach an agreement at the next European Council on Thursday.”
Meanwhile, in Berlin, European leaders are meeting with Ukrainian President Volodymyr Zelensky on Monday to try to advance the peace plan proposed by the United States. Zelensky has the support of European leaders to negotiate some of the initial 28 points proposed in Washington’s plan. Kyiv has already stressed that the proposals to cede the Donetsk territories are unacceptable. On the other hand, Zelensky admitted that he could eliminate his desire for Ukraine to join NATO.
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