🔗 Share this article Russia Hits Back at the EU's Proposal to Lend Immobilized Moscow's Funds to Ukraine Kyiv remains depleting its financial resources to maintain its armed forces and economy, after close to 48 months of the ongoing invasion by Moscow. For Europe, the remedy to addressing Ukraine's funding gap of €135.7bn for the following biennium rests with assets belonging to Russia that are frozen located within Belgian bank Euroclear, and European Union officials seek to give it the green light at their Brussels summit next week. Authorities in Russia warn the EU plan would be an confiscation, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court even before a final decision is made. 'Just' to Employ Russia's Assets, Argue Kyiv and Brussels In total, Russia has roughly €210bn of its funds frozen in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that those funds should be used to reconstruct what Russia has destroyed: EU officials calls it a "reparations loan" and has proposed a plan to prop up Ukraine's economy to the tune of €90bn. "It is only just that the assets frozen from Russia should be used to reconstruct what Russia has destroyed – and that that capital then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "allow Ukraine to shield itself effectively against future Russian attacks". Moscow's lawsuit was expected in Brussels. But it is not just Moscow that is concerned. Belgium is worried it will be saddled with an enormous bill if it all goes wrong, and Euroclear head Valérie Urbain says using the assets could "destabilise the world's financial order". Euroclear also has an estimated €16-17bn frozen in Russia. Belgium's PM Bart de Wever has presented the EU with a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reconstruction loan scheme, and he has left open the possibility of legal action if it "presents significant risks" for his country. The Details of the EU's Plan? The EU is racing against time prior to next Thursday's summit to finalize a arrangement that Belgium can agree to. So far the EU has avoided using the assets themselves directly but starting in 2024 has transferred the "windfall profits" from them to Ukraine. In 2024 that was €3.7bn. Legally, using the profits is considered safe as Russia is under sanction and the proceeds are not property of the Russian state. But global military support for Ukraine has slipped dramatically in 2025, and Europe has found it difficult to make up the shortfall resulting from the US decision to all but stop funding Ukraine under President Donald Trump. There are presently two EU options seeking to providing Ukraine with €90bn, to cover a large portion of its funding needs. One is to secure the capital on capital markets, backed by the EU budget as a collateral. This is Belgium's preferred option but it requires a consensus by EU leaders and that would be difficult when Hungary and Slovakia are against funding Ukraine's military. This makes the other option lending Ukraine cash from the Russian assets, which were at first held in financial instruments but have now largely matured into cash. That money is owned by Euroclear held in the European Central Bank. Brussels' executive arm acknowledges Belgium has valid worries and says it is convinced it has dealt with them. The scheme is for Belgium to be safeguarded with a assurance encompassing all the €210bn of Russian assets in the EU. Should Euroclear face a financial hit of its own assets in Russia, that would be offset from assets belonging to Russia's own clearing house which are in the EU. Should Russia targeted Belgium itself, any ruling by a Russian court would not be enforced in the EU. As an important step, EU ambassadors are expected to agree on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Previously they have had to vote unanimously every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an special provision under Article 122 of the EU Treaties so the assets remain frozen as long as an "immediate threat to the financial well-being of the union" continues. The Reasons Belgium is Not Yet Convinced Brussels is firm it remains a staunch ally of Ukraine, but sees legal risks in the plan and fears being forced to deal with the repercussions if things do not work out. A normally divided political landscape in this case has rallied behind Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "The Belgian economy is not large. Belgian GDP is about €565bn – think about if it would need to bear a €185bn bill," notes Veerle Colaert, expert in financial law at KU Leuven University. While the EU might be able to secure sufficient guarantees for the loan itself, Belgium is concerned about an additional danger of being exposed to extra fines or liabilities. Prof Colaert also believes the requirement for Euroclear to provide a loan to the EU would contravene EU banking regulations. "Lenders need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do just that. "Why do we have these banking laws? It's because we want banks to be stable. And if things go wrong it would fall to Belgium to save Euroclear. That's a further cause why it's so vital for Belgium to secure absolute assurances for Euroclear." The European Union Facing Strain from Every Direction There is no time to lose, warn a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the most financially feasible and practically possible solution". "It's a matter of destiny for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do subsequently. That's why we have to succeed in a week's time". While Russia is unyielding its money should not be used, there are additional apprehensions among leaders in Europe that the US may want to use Russia's immobilized billions for another purpose, as part of its own peace plan. Zelensky has indicated Ukraine is working with Europe and the US on a reconstruction fund, but he is also mindful the US has been talking to Russia about possible partnership. An early draft of the US peace plan referred to $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving
Kyiv remains depleting its financial resources to maintain its armed forces and economy, after close to 48 months of the ongoing invasion by Moscow. For Europe, the remedy to addressing Ukraine's funding gap of €135.7bn for the following biennium rests with assets belonging to Russia that are frozen located within Belgian bank Euroclear, and European Union officials seek to give it the green light at their Brussels summit next week. Authorities in Russia warn the EU plan would be an confiscation, and Russia's central bank announced on Friday it was taking to court Euroclear in a Moscow court even before a final decision is made. 'Just' to Employ Russia's Assets, Argue Kyiv and Brussels In total, Russia has roughly €210bn of its funds frozen in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that those funds should be used to reconstruct what Russia has destroyed: EU officials calls it a "reparations loan" and has proposed a plan to prop up Ukraine's economy to the tune of €90bn. "It is only just that the assets frozen from Russia should be used to reconstruct what Russia has destroyed – and that that capital then becomes Ukraine's," states Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "allow Ukraine to shield itself effectively against future Russian attacks". Moscow's lawsuit was expected in Brussels. But it is not just Moscow that is concerned. Belgium is worried it will be saddled with an enormous bill if it all goes wrong, and Euroclear head Valérie Urbain says using the assets could "destabilise the world's financial order". Euroclear also has an estimated €16-17bn frozen in Russia. Belgium's PM Bart de Wever has presented the EU with a series of "pragmatic, fair, and legitimate conditions" before he will endorse the reconstruction loan scheme, and he has left open the possibility of legal action if it "presents significant risks" for his country. The Details of the EU's Plan? The EU is racing against time prior to next Thursday's summit to finalize a arrangement that Belgium can agree to. So far the EU has avoided using the assets themselves directly but starting in 2024 has transferred the "windfall profits" from them to Ukraine. In 2024 that was €3.7bn. Legally, using the profits is considered safe as Russia is under sanction and the proceeds are not property of the Russian state. But global military support for Ukraine has slipped dramatically in 2025, and Europe has found it difficult to make up the shortfall resulting from the US decision to all but stop funding Ukraine under President Donald Trump. There are presently two EU options seeking to providing Ukraine with €90bn, to cover a large portion of its funding needs. One is to secure the capital on capital markets, backed by the EU budget as a collateral. This is Belgium's preferred option but it requires a consensus by EU leaders and that would be difficult when Hungary and Slovakia are against funding Ukraine's military. This makes the other option lending Ukraine cash from the Russian assets, which were at first held in financial instruments but have now largely matured into cash. That money is owned by Euroclear held in the European Central Bank. Brussels' executive arm acknowledges Belgium has valid worries and says it is convinced it has dealt with them. The scheme is for Belgium to be safeguarded with a assurance encompassing all the €210bn of Russian assets in the EU. Should Euroclear face a financial hit of its own assets in Russia, that would be offset from assets belonging to Russia's own clearing house which are in the EU. Should Russia targeted Belgium itself, any ruling by a Russian court would not be enforced in the EU. As an important step, EU ambassadors are expected to agree on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Previously they have had to vote unanimously every six months to continue the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are planning to use an special provision under Article 122 of the EU Treaties so the assets remain frozen as long as an "immediate threat to the financial well-being of the union" continues. The Reasons Belgium is Not Yet Convinced Brussels is firm it remains a staunch ally of Ukraine, but sees legal risks in the plan and fears being forced to deal with the repercussions if things do not work out. A normally divided political landscape in this case has rallied behind Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "The Belgian economy is not large. Belgian GDP is about €565bn – think about if it would need to bear a €185bn bill," notes Veerle Colaert, expert in financial law at KU Leuven University. While the EU might be able to secure sufficient guarantees for the loan itself, Belgium is concerned about an additional danger of being exposed to extra fines or liabilities. Prof Colaert also believes the requirement for Euroclear to provide a loan to the EU would contravene EU banking regulations. "Lenders need to comply with capital and liquidity requirements and shouldn't concentrate risk. Now the EU is asking Euroclear to do just that. "Why do we have these banking laws? It's because we want banks to be stable. And if things go wrong it would fall to Belgium to save Euroclear. That's a further cause why it's so vital for Belgium to secure absolute assurances for Euroclear." The European Union Facing Strain from Every Direction There is no time to lose, warn a group of EU member states including those neighboring Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the most financially feasible and practically possible solution". "It's a matter of destiny for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do subsequently. That's why we have to succeed in a week's time". While Russia is unyielding its money should not be used, there are additional apprehensions among leaders in Europe that the US may want to use Russia's immobilized billions for another purpose, as part of its own peace plan. Zelensky has indicated Ukraine is working with Europe and the US on a reconstruction fund, but he is also mindful the US has been talking to Russia about possible partnership. An early draft of the US peace plan referred to $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving