EU outlines plan to seize proceeds from frozen Russian assets and pass them on to kyiv
Russian assets frozen after the invasion of Ukraine, in order to finance the purchase of weapons for kyiv.
After Brussels' announcement, Russia threatened legal action against the EU "
for decades
", calling the plan "
theft
".
Head of European diplomacy and security policy Josep Borrell (right) and Ukrainian Prime Minister Denys Shmyhal give a press conference after a meeting of the EU-Ukraine Association Council at the EU headquarters in Brussels, March 20, 2024. © John Thys / AFP
By: RFI with AFP
Advertisement
Read more
Between 2.5 billion and 3 billion euros just for 2024: this is the European Commission's calculation of what immobilized Russian assets could bring in, reports our correspondent in Brussels,
Pierre Benazet
.
Since the invasion of Ukraine, the
approximately 260 billion euros in assets of the Russian central bank
have been frozen, two thirds of which – around 210 billion euros – are tied up in financial institutions in the European Union .
Since February 15, these financial institutions, the credit depositories, have been prohibited from touching the profits generated by these assets – or from distributing dividends to shareholders.
But now, after a little more than two years of war, the Ukrainian army is undermanned and demanding munitions and air defense systems to contain an offensive Russian army.
“
The summer will be decisive
,” stressed Josep Borrell on this point, who
expects a major Russian offensive against Ukraine
during this period.
“
Everything will be decided this summer
,” he insisted.
According to this proposal, the EU would tax financial institutions holding 97% of Russian assets, and pass them on to Ukraine: ultimately, these assets would be
allocated to the reconstruction of Ukraine
.
But for 2024, 90% of the seized revenue would be intended for the European Peace Facility (EFF), which finances arms purchases.
The remaining 10% would be paid to the EU budget to “
strengthen the capabilities of the Ukrainian defense industry
”, according to Josep Borrell.
The proposal is expected to be discussed by the leaders of the 27 member countries at a summit on Thursday March 21 and Friday March 22.
Also read: Are sanctions against Russia really effective?
Moscow threatens prosecution “
over decades
” over “
theft
”
Shortly after the plan was announced, Russia threatened legal action against the European Union "
for decades
."
“
Europeans must be well aware of the damage that such decisions could cause to their economy, their image, their reputation as reliable guarantors of the inviolability of property
,” Kremlin spokesperson Dmitri Peskov warned to the press.
The people, the states, who will be involved in making such decisions, will naturally become the object of prosecution for many decades
,” he added.
Russian diplomatic spokesperson Maria Zakharova denounced an initiative that amounts to “
banditry
” and “
theft
”.
“
These actions constitute a blatant and unprecedented violation of fundamental international norms
,” she said, promising a response from Moscow.
For Éric Maurice, expert at the European Policy Center in Brussels, “
Russia is in its role
”, but it is only “
intimidation
”.
Because if the “
member states accept the proposal
”, “
it is because it is legally solid
” and therefore not reproachable before international justice.
00:59
For Éric Maurice, expert at the European Policy Center in Brussels, this is "pure diplomacy", because Moscow is only trying to "intimidate the EU by making it believe it has legal difficulties", while we " expects the proposal to be legally sound"
Christophe Paget
A legally secure plan?
But according to European officials, the plan submitted to the Twenty-Seven for their agreement is safe from a legal point of view, because there is no question of touching the capital itself, but only "
the profits made by an operator private
”, in this case the financial institution holding Russian assets.
According to them, these revenues are not the property of Russia.
According to these same sources, in the event of rapid agreement by EU member states, the measure could apply as early as July.
How to use Russian state assets, which were blocked after Russia launched its invasion of Ukraine in February 2022,
is the subject of intense discussion
.
Some countries fear the consequences of such a seizure, whether on income from Russian assets or,
a fortiori
, on these assets themselves, fearing the precedent that this could create for the financial markets.
According to Éric Maurice, expert at the European Policy Center in Brussels, the debate around this measure is legal but also political-financial, because it is difficult to seize the funds in themselves: hence the choice to seize the income which generates the funds. .
01:04
According to Éric Maurice, expert at the European Policy Center in Brussels, it is difficult to seize the funds themselves: hence the seizure of income which generates the funds
Christophe Paget
Russia summoned the Swiss ambassador to Moscow last week to protest against the vote on measures in Switzerland intended to allow the use of Russian assets frozen on its territory to finance reparations in Ukraine.
Also read: Ukraine: “Russia is at war with the values” of Europe
Newsletter
Receive all the international news directly in your inbox
I subscribe
Follow all the international news by downloading the RFI application
Share :
Continue reading on the same themes:
European Union
Ukraine
Finance
Russia