🔗 Share this article Moscow Demands Substantial Amount in Compensation from Euroclear over Seized Assets The Russian central bank has declared it is seeking damages valued at $230 billion from the financial institution Euroclear. This move constitutes a direct response by the Kremlin against proposals to utilize immobilized Russian state funds to aid Ukraine. The Legal Claim According to accounts in local state media, the central bank filed a claim last week for approximately 18 trillion roubles. This figure corresponds to the aforementioned $230 billion claim. EU leaders are set to decide later this week regarding a proposal to use around €210 billion in immobilized Russian state funds. This scheme entails granting Ukraine with a substantial loan to finance its defence and economic needs. The vast majority of these funds, totaling €185 billion, are stored at the Euroclear clearing house in Brussels. Euroclear serves as the primary keeper for the Kremlin's immobilised sovereign wealth. Dispute on Ownership EU authorities have argued that their plan is on solid legal ground. Their position is based on the fact that title of the state assets remains with Russia, even though it was frozen in European jurisdictions shortly after the 2022 military offensive of Ukraine. Moscow, however, has labeled any utilization of the assets as illegal appropriation. Authorities have warned of retaliatory measures, such as seizing EU private investors' assets within Russia. The head of Russia's sovereign wealth fund, a figure who has assumed a prominent position in diplomatic talks, stated on X that Russia "will win in court" and regain its assets. He warned that the EU, the euro, and Euroclear "will face consequences" from the plan. Wider Implications In comments interpreted as an effort to create division between Europe and the United States, the official described the proposal as "a vicious attack on property rights and the international reserves system established by the United States." Euroclear declined to comment on the new lawsuit. The institution has in the past noted it is facing over 100 lawsuits in Russian courts. Enforcement Challenges While judges in European nations are unlikely to enforce judgments from Russian tribunals, experts expect Moscow to seek implementation in nations with closer ties to the Kremlin. "The Bank of Russia may attempt to implement a Russian legal ruling against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other friendly nations, provided that relevant holdings can be located," stated a legal expert from an international firm. European Safeguards EU officials said they are working on measures to deter other countries from aiding any Russian legal action against EU entities. Additionally, they are designing protections to protect EU countries with assets in Russia from what they term "illegal expropriation." The Proposed Loan Mechanism According to the complex plan, the EU would provide an first €90 billion loan to Ukraine, using the proceeds generated from the immobilized assets at Euroclear. Critically, Russia's ownership claim on the underlying funds would stay untouched. Ukraine would solely be required to repay the loan if and when Russia consented to pay compensation for the vast damage inflicted during the nearly four-year conflict. Alternative Proposals The Belgian government, supported by Italy, Bulgaria, and Malta, has asked the EU to examine an different method for funding Ukraine. This involves common EU debt issuance to fund a loan, backed by unallocated funds within the EU budget. Such a proposal, nevertheless, demands full agreement among all 27 EU countries. The Hungarian government, viewed as aligned with the Kremlin, has already signaled its opposition. Commenting on Monday, the EU foreign policy chief, a senior official, said the proposed loan scheme as "the most credible option" for supporting Ukraine. "This mechanism is secured against the Russian immobilized funds, which means it doesn't come from our taxpayers' money, which is equally important," she stated. "It also delivers a powerful message that if you cause all this destruction to another nation, you have to pay for the reparations."