🔗 Share this article Russia Hits Back at the EU's Scheme to Lend Frozen Moscow's Funds to Ukraine Ukraine is running out of cash to sustain its armed forces and economy afloat, after close to 48 months of Russia's full-scale war. In the view of European leaders, the answer to addressing Ukraine's financial shortfall of €135.7bn for the coming 24 months rests with frozen Russian assets held by Belgian bank Euroclear, and European Union officials hope to sign that off at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an illegal seizure, and the Central Bank of Russia declared on Friday it was initiating legal action against Euroclear in a Moscow court ahead of a final decision is made. 'Only Fair' to Utilize Moscow's Assets, Say Kyiv and Brussels In total, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is held by Euroclear. Brussels and Kyiv contend that money should be used to reconstruct what Russia has laid waste to: EU officials terms it a "reparations loan" and has proposed a plan to prop up Ukraine's economy amounting to €90bn. "It's only fair that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes ours," remarks Ukraine's Volodymyr Zelensky. Germany's leader Friedrich Merz states the assets will "help Ukraine to protect itself efficiently against subsequent Russian attacks". Moscow's lawsuit was expected in Brussels. But it is not just Moscow that is dissatisfied. Authorities in Brussels is worried it will be saddled with an massive bill if it all goes wrong, and Euroclear chief executive Valérie Urbain says using the assets could "undermine the world's financial order". Euroclear also has an roughly €16-17bn immobilised in Russia. The leader of Belgium Bart de Wever has presented the EU with a series of "logical, sensible, and warranted conditions" before he will agree to the reconstruction loan scheme, and he has left open the possibility of legal action if it "presents significant risks" for his country. What is the EU's Plan? European Union officials is working to the wire before next Thursday's summit to finalize a solution that Belgium can accept. So far the EU has avoided using the assets themselves directly but since last year has paid the "extraordinary revenues" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the revenue is considered permissible as Russia is subject to sanctions and the proceeds are not Moscow's sovereign assets. But global military support for Ukraine has fallen significantly in 2025, and Europe has found it difficult to compensate for 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 supplying Ukraine with €90bn, to cover a majority of its funding needs. Option one is to borrow the funds on capital markets, guaranteed by the EU budget as a surety. This is Belgium's first choice but it needs a agreement by all by EU leaders and that would be challenging when two member states are against funding Ukraine's military. That leaves providing a loan of Ukraine cash from the frozen Russian funds, which were initially held in securities but have now largely matured into cash. That funding is Euroclear property held in the European Central Bank. The EU's executive accepts Belgium has legitimate concerns and claims it is assured it has dealt with them. The proposal is for Belgium to be shielded with a assurance covering all the €210bn of Russian assets in the EU. If Euroclear incur losses 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 went after Belgium itself, any decision by a Russian court would not be accepted in the EU. In a significant move, EU ambassadors are poised to endorse on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Until now they have had to vote unanimously every six months to extend the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are expected to use an special provision under Article 122 of the EU Treaties so the assets stay blocked as long as an "clear risk to the economic interests of the union" continues. Why Belgium is Still Not Convinced Belgium is insistent it remains a strong supporter of Ukraine, but identifies legal risks in the plan and is concerned about being shouldering the repercussions if things fail. A usually fractured political scene 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 approximately €565bn – think about if it would need to bear a €185bn bill," comments Veerle Colaert, professor of financial law at KU Leuven University. Although the EU might be able to obtain enough guarantees for the loan itself, Belgium is concerned about an further exposure of being exposed to extra fines or liabilities. Prof Colaert also believes the stipulation for Euroclear to grant a loan to the EU would breach EU banking regulations. "Banks need to follow stability regulations and shouldn't concentrate risk. Now the EU is asking Euroclear to do just that. "Why do we have these bank rules? It's because we want banks to be stable. And if things turn sour it would become the responsibility of Belgium to save Euroclear. That's another reason why it's so vital for Belgium to obtain absolute assurances for Euroclear." The European Union In a Difficult Position from Every Direction There is no time to lose, state a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the frozen assets plan is "a economically realistic and politically achievable solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do next. That's why we have to finalize the deal in a week's time". While Russia is unyielding its money should not be touched, there are added concerns among leaders in Europe that the US may want to employ Russia's blocked funds for another purpose, as part of its own peace plan. Zelensky has indicated Ukraine is working with Europe and the US on a recovery fund, but he is also mindful the US has been engaging with Russia about future co-operation. An initial document of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving
Ukraine is running out of cash to sustain its armed forces and economy afloat, after close to 48 months of Russia's full-scale war. In the view of European leaders, the answer to addressing Ukraine's financial shortfall of €135.7bn for the coming 24 months rests with frozen Russian assets held by Belgian bank Euroclear, and European Union officials hope to sign that off at their meeting in Brussels next week. Authorities in Russia state the EU plan would be an illegal seizure, and the Central Bank of Russia declared on Friday it was initiating legal action against Euroclear in a Moscow court ahead of a final decision is made. 'Only Fair' to Utilize Moscow's Assets, Say Kyiv and Brussels In total, Russia has roughly €210bn of its assets immobilized in the EU, and €185bn of that is held by Euroclear. Brussels and Kyiv contend that money should be used to reconstruct what Russia has laid waste to: EU officials terms it a "reparations loan" and has proposed a plan to prop up Ukraine's economy amounting to €90bn. "It's only fair that Russia's frozen assets should be used to rebuild what Russia has devastated – and that money then becomes ours," remarks Ukraine's Volodymyr Zelensky. Germany's leader Friedrich Merz states the assets will "help Ukraine to protect itself efficiently against subsequent Russian attacks". Moscow's lawsuit was expected in Brussels. But it is not just Moscow that is dissatisfied. Authorities in Brussels is worried it will be saddled with an massive bill if it all goes wrong, and Euroclear chief executive Valérie Urbain says using the assets could "undermine the world's financial order". Euroclear also has an roughly €16-17bn immobilised in Russia. The leader of Belgium Bart de Wever has presented the EU with a series of "logical, sensible, and warranted conditions" before he will agree to the reconstruction loan scheme, and he has left open the possibility of legal action if it "presents significant risks" for his country. What is the EU's Plan? European Union officials is working to the wire before next Thursday's summit to finalize a solution that Belgium can accept. So far the EU has avoided using the assets themselves directly but since last year has paid the "extraordinary revenues" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the revenue is considered permissible as Russia is subject to sanctions and the proceeds are not Moscow's sovereign assets. But global military support for Ukraine has fallen significantly in 2025, and Europe has found it difficult to compensate for 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 supplying Ukraine with €90bn, to cover a majority of its funding needs. Option one is to borrow the funds on capital markets, guaranteed by the EU budget as a surety. This is Belgium's first choice but it needs a agreement by all by EU leaders and that would be challenging when two member states are against funding Ukraine's military. That leaves providing a loan of Ukraine cash from the frozen Russian funds, which were initially held in securities but have now largely matured into cash. That funding is Euroclear property held in the European Central Bank. The EU's executive accepts Belgium has legitimate concerns and claims it is assured it has dealt with them. The proposal is for Belgium to be shielded with a assurance covering all the €210bn of Russian assets in the EU. If Euroclear incur losses 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 went after Belgium itself, any decision by a Russian court would not be accepted in the EU. In a significant move, EU ambassadors are poised to endorse on Friday to freeze indefinitely Russia's central bank assets held in Europe indefinitely. Until now they have had to vote unanimously every six months to extend the freeze, which could have meant a constant risk to Belgium. The EU ambassadors are expected to use an special provision under Article 122 of the EU Treaties so the assets stay blocked as long as an "clear risk to the economic interests of the union" continues. Why Belgium is Still Not Convinced Belgium is insistent it remains a strong supporter of Ukraine, but identifies legal risks in the plan and is concerned about being shouldering the repercussions if things fail. A usually fractured political scene 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 approximately €565bn – think about if it would need to bear a €185bn bill," comments Veerle Colaert, professor of financial law at KU Leuven University. Although the EU might be able to obtain enough guarantees for the loan itself, Belgium is concerned about an further exposure of being exposed to extra fines or liabilities. Prof Colaert also believes the stipulation for Euroclear to grant a loan to the EU would breach EU banking regulations. "Banks need to follow stability regulations and shouldn't concentrate risk. Now the EU is asking Euroclear to do just that. "Why do we have these bank rules? It's because we want banks to be stable. And if things turn sour it would become the responsibility of Belgium to save Euroclear. That's another reason why it's so vital for Belgium to obtain absolute assurances for Euroclear." The European Union In a Difficult Position from Every Direction There is no time to lose, state a group of EU member states including those bordering Russia such as the Baltics, Finland and Poland. They believe the frozen assets plan is "a economically realistic and politically achievable solution". "This is a crucial test for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do next. That's why we have to finalize the deal in a week's time". While Russia is unyielding its money should not be touched, there are added concerns among leaders in Europe that the US may want to employ Russia's blocked funds for another purpose, as part of its own peace plan. Zelensky has indicated Ukraine is working with Europe and the US on a recovery fund, but he is also mindful the US has been engaging with Russia about future co-operation. An initial document of the US peace plan mentioned $100bn of Russia's frozen assets being used by the US for reconstruction, with the US {taking|receiving