🔗 Share this article Russia Responds at the EU's Proposal to Loan Frozen Russian Assets to Kyiv Ukraine is depleting its funding to sustain its military and economy afloat, after nearly four years of Russia's full-scale war. From the EU's perspective, the answer to filling Kyiv's financial shortfall of €135.7bn for the coming 24 months lies in frozen Russian assets held by Belgian bank Euroclear, and Brussels aim to finalize the plan at their meeting in Brussels next week. Moscow's representatives state the EU plan would be an act of theft, and the Central Bank of Russia declared on Friday it was initiating legal action against Euroclear in a Moscow court prior to a conclusive plan is made. 'Just' to Use Russia's Funds, Argue Ukraine and the EU All told, Russia has roughly €210bn of its funds immobilized in the EU, and €185bn of that is held by Euroclear. The EU and Ukraine contend that money should be used to rebuild what Russia has devastated: Brussels calls it a "reparations loan" and has devised a plan to bolster Ukraine's economy to the tune of €90bn. "It is appropriate that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes ours," states Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz argues the assets will "allow Ukraine to shield itself successfully against any future Russian attacks". Russia's court action was expected in Brussels. But it is not just Moscow that is dissatisfied. Authorities in Brussels is concerned it will be left with an enormous bill if it all fails, and Euroclear head Valérie Urbain warns using the assets could "disrupt the world's financial order". Euroclear also has an estimated €16-17bn frozen in Russia. Belgian Prime Minister 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 not excluded legal action if it "presents significant risks" for his country. The Details of the EU's Proposal? European Union officials is working to the wire before next Thursday's summit to agree on a solution that Belgium can accept. Previously the EU has avoided using the assets themselves directly but since last year has directed the "extraordinary revenues" from them to Ukraine. In 2024 that amounted to €3.7bn. Juridically, using the interest is deemed permissible as Russia is sanctioned and the proceeds are not Moscow's sovereign assets. But international military aid for Ukraine has fallen significantly in 2025, and Europe has found it difficult to make up the deficit resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are currently two EU options aimed at furnishing Ukraine with €90bn, to cover a large portion of its financial requirements. One is to secure the capital on financial markets, secured against the EU budget as a surety. This is Belgium's preferred option but it needs a consensus by EU leaders and that would be problematic when Budapest and Bratislava oppose funding Ukraine's military. The alternative is lending Ukraine cash from the Moscow's immobilized capital, which were originally held in securities but have now mostly matured into cash. That capital is an asset of Euroclear located within the European Central Bank. Brussels' executive arm acknowledges Belgium has legitimate concerns and claims it is confident it has resolved them. The scheme is for Belgium to be protected with a assurance covering all the €210bn of Russian assets in the EU. If Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered from assets belonging to Russia's own settlement agency which are in the EU. Should Russia took legal action against Belgium itself, any ruling by a Russian court would not be accepted in the EU. As an important step, EU ambassadors are poised to endorse on Friday to freeze indefinitely Russia's central bank assets held in Europe permanently. Until now they have had to vote by consensus every six months to continue the freeze, which could have meant a repeated risk to Belgium. The EU ambassadors are expected to use an emergency clause under Article 122 of the EU Treaties so the assets stay blocked as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Still Not Satisfied Belgium is insistent it remains a strong supporter of Ukraine, but identifies juridical dangers in the plan and is concerned about being forced to deal with the repercussions if things fail. A usually divided political landscape in this case has come together in support of Prime Minister Bart de Wever, who is being pressured from other European officials. "The Belgian economy is not large. Belgian GDP is around €565bn – consider if it would need to bear a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to arrange sufficient protections for the loan itself, Belgium is concerned about an added risk of being subject to extra fines or liabilities. Prof Colaert also believes the demand for Euroclear to issue credit to the EU would violate EU banking regulations. "Lenders need to comply with stability regulations and shouldn't put all their eggs in one basket. Now the EU is asking Euroclear to do exactly that. "What is the purpose of these bank rules? It's because we want banks to be solvent. And if things go wrong it would be up to Belgium to bail out Euroclear. That's another reason why it's so crucial for Belgium to get ironclad assurances for Euroclear." The European Union Facing Strain from Multiple Fronts The situation is urgent, warn seven EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the economically realistic and practically possible solution". "It is a decisive moment for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do afterwards. That's why we have to finalize the deal in a week's time". Although Russia is unyielding its money should not be accessed, there are additional apprehensions among EU officials that the US may want to use Russia's immobilized billions differently, as part of its own peace initiative. Zelensky has stated Ukraine is coordinating with Europe and the US on a recovery fund, but he is also aware the US has been talking to Russia about potential collaboration. An early draft of the US peace plan mentioned $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving
Ukraine is depleting its funding to sustain its military and economy afloat, after nearly four years of Russia's full-scale war. From the EU's perspective, the answer to filling Kyiv's financial shortfall of €135.7bn for the coming 24 months lies in frozen Russian assets held by Belgian bank Euroclear, and Brussels aim to finalize the plan at their meeting in Brussels next week. Moscow's representatives state the EU plan would be an act of theft, and the Central Bank of Russia declared on Friday it was initiating legal action against Euroclear in a Moscow court prior to a conclusive plan is made. 'Just' to Use Russia's Funds, Argue Ukraine and the EU All told, Russia has roughly €210bn of its funds immobilized in the EU, and €185bn of that is held by Euroclear. The EU and Ukraine contend that money should be used to rebuild what Russia has devastated: Brussels calls it a "reparations loan" and has devised a plan to bolster Ukraine's economy to the tune of €90bn. "It is appropriate that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes ours," states Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz argues the assets will "allow Ukraine to shield itself successfully against any future Russian attacks". Russia's court action was expected in Brussels. But it is not just Moscow that is dissatisfied. Authorities in Brussels is concerned it will be left with an enormous bill if it all fails, and Euroclear head Valérie Urbain warns using the assets could "disrupt the world's financial order". Euroclear also has an estimated €16-17bn frozen in Russia. Belgian Prime Minister 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 not excluded legal action if it "presents significant risks" for his country. The Details of the EU's Proposal? European Union officials is working to the wire before next Thursday's summit to agree on a solution that Belgium can accept. Previously the EU has avoided using the assets themselves directly but since last year has directed the "extraordinary revenues" from them to Ukraine. In 2024 that amounted to €3.7bn. Juridically, using the interest is deemed permissible as Russia is sanctioned and the proceeds are not Moscow's sovereign assets. But international military aid for Ukraine has fallen significantly in 2025, and Europe has found it difficult to make up the deficit resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are currently two EU options aimed at furnishing Ukraine with €90bn, to cover a large portion of its financial requirements. One is to secure the capital on financial markets, secured against the EU budget as a surety. This is Belgium's preferred option but it needs a consensus by EU leaders and that would be problematic when Budapest and Bratislava oppose funding Ukraine's military. The alternative is lending Ukraine cash from the Moscow's immobilized capital, which were originally held in securities but have now mostly matured into cash. That capital is an asset of Euroclear located within the European Central Bank. Brussels' executive arm acknowledges Belgium has legitimate concerns and claims it is confident it has resolved them. The scheme is for Belgium to be protected with a assurance covering all the €210bn of Russian assets in the EU. If Euroclear suffer a loss of its own assets in Russia, the shortfall would be covered from assets belonging to Russia's own settlement agency which are in the EU. Should Russia took legal action against Belgium itself, any ruling by a Russian court would not be accepted in the EU. As an important step, EU ambassadors are poised to endorse on Friday to freeze indefinitely Russia's central bank assets held in Europe permanently. Until now they have had to vote by consensus every six months to continue the freeze, which could have meant a repeated risk to Belgium. The EU ambassadors are expected to use an emergency clause under Article 122 of the EU Treaties so the assets stay blocked as long as an "immediate threat to the financial well-being of the union" continues. Why Belgium is Still Not Satisfied Belgium is insistent it remains a strong supporter of Ukraine, but identifies juridical dangers in the plan and is concerned about being forced to deal with the repercussions if things fail. A usually divided political landscape in this case has come together in support of Prime Minister Bart de Wever, who is being pressured from other European officials. "The Belgian economy is not large. Belgian GDP is around €565bn – consider if it would need to bear a €185bn bill," says Veerle Colaert, academic specializing in financial regulation at KU Leuven University. Although the EU might be able to arrange sufficient protections for the loan itself, Belgium is concerned about an added risk of being subject to extra fines or liabilities. Prof Colaert also believes the demand for Euroclear to issue credit to the EU would violate EU banking regulations. "Lenders need to comply with stability regulations and shouldn't put all their eggs in one basket. Now the EU is asking Euroclear to do exactly that. "What is the purpose of these bank rules? It's because we want banks to be solvent. And if things go wrong it would be up to Belgium to bail out Euroclear. That's another reason why it's so crucial for Belgium to get ironclad assurances for Euroclear." The European Union Facing Strain from Multiple Fronts The situation is urgent, warn seven EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the scheme involving immobilized capital is "the economically realistic and practically possible solution". "It is a decisive moment for us," says leading German conservative MP Norbert Röttgen. "If the plan collapses, I don't know what we'll do afterwards. That's why we have to finalize the deal in a week's time". Although Russia is unyielding its money should not be accessed, there are additional apprehensions among EU officials that the US may want to use Russia's immobilized billions differently, as part of its own peace initiative. Zelensky has stated Ukraine is coordinating with Europe and the US on a recovery fund, but he is also aware the US has been talking to Russia about potential collaboration. An early draft of the US peace plan mentioned $100bn of Russia's blocked funds being used by the US for reconstruction, with the US {taking|receiving