🔗 Share this article Russia Retaliates at Europe's Scheme to Lend Immobilized Moscow's Cash to Ukraine Kyiv remains running out of financial resources to keep going its armed forces and economy, after almost four years of the ongoing invasion by Moscow. From the EU's perspective, the remedy to filling Ukraine's budget hole of €135.7bn for the coming 24 months is found in Moscow's immobilized funds located within Belgian bank Euroclear, and Brussels aim to sign that off at their Brussels summit next week. Authorities in Russia state the EU plan would be an confiscation, and the Central Bank of Russia stated on Friday it was taking to court Euroclear in a Moscow court even before a conclusive plan is made. 'Appropriate' to Employ Russia's Assets, Say Ukraine and the EU In total, Russia has roughly €210bn of its funds immobilized in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that that capital should be used to rebuild what Russia has destroyed: The European Commission terms it a "reparations loan" and has come up with a plan to prop up Ukraine's economy amounting to €90bn. "It is only just that the assets frozen from Russia should be used to rebuild what Russia has devastated – and that money then becomes Ukraine's," says Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "help Ukraine to protect itself effectively against subsequent Russian attacks". Russia's court action was foreseen in Brussels. But it is not only Moscow that is unhappy. The Belgian government is concerned it will be left with an massive bill if it all backfires, and Euroclear CEO Valérie Urbain warns using the assets could "disrupt the international financial system". Euroclear also has an estimated €16-17bn immobilised in Russia. The leader of Belgium Bart de Wever has presented the EU with a series of "rational, reasonable, and justified conditions" before he will endorse the reconstruction loan scheme, and he has left open the possibility of legal action if it "poses significant risks" for his country. Explaining the EU's Strategy? The EU is racing against time prior to next Thursday's summit to finalize a solution that Belgium can support. Previously the EU has refrained from accessing the frozen capital directly but since last year has paid the "windfall profits" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the profits is deemed less risky as Russia is under sanction and the returns are not property of the Russian state. But foreign defense assistance for Ukraine has declined sharply in 2025, and Europe has found it difficult to make up the shortfall resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are at the moment two EU plans aimed at providing Ukraine with €90bn, to cover two-thirds of its financial requirements. One is to raise the money on capital markets, backed by the EU budget as a guarantee. This is Belgium's preferred option but it requires a consensus by EU leaders and that would be problematic when Budapest and Bratislava object to funding Ukraine's military. This makes the other option providing a loan of Ukraine cash from the Russian assets, which were at first held in securities but have now predominantly turned into cash. That funding is Euroclear property located within the European Central Bank. The EU's executive accepts Belgium has valid worries and says it is confident it has resolved them. The proposal is for Belgium to be protected with a assurance covering all the €210bn of Russian assets in the EU. Should Euroclear incur losses of its own assets in Russia, that would be offset from assets belonging to Russia's own clearing house which are in the EU. If Russia targeted Belgium itself, any ruling 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 permanently. Heretofore they have had to vote all together every six months to extend the freeze, which could have meant a ongoing 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 "direct danger to the financial well-being of the union" continues. Why Belgium is Still Not Satisfied Belgium is firm it remains a staunch ally of Ukraine, but sees regulatory pitfalls in the plan and worries about being forced to deal with the fallout if things do not work out. A normally divided political landscape in this case has come together in support of Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "Belgium has a modest-sized economy. Belgian GDP is about €565bn – imagine if it would need to bear a €185bn bill," says Veerle Colaert, professor of financial law at KU Leuven University. While the EU might be able to arrange enough assurances for the loan itself, Belgium worries about an added risk of being exposed to extra fines or liabilities. Prof Colaert also believes the requirement for Euroclear to grant a loan to the EU would contravene EU banking regulations. "Lenders need to follow stability regulations and shouldn't make one enormous loan. Now the EU is instructing Euroclear to do exactly that. "Why do we have these banking laws? It's because we want banks to be stable. And if things go wrong it would be up to Belgium to bail out Euroclear. That's an additional reason why it's so vital for Belgium to secure water-tight guarantees for Euroclear." Europe Under Pressure from Multiple Fronts The situation is urgent, caution a group of EU member states including those closest to Russia such as the Baltics, Finland and Poland. They argue the proposal to use Russian funds is "the fiscally viable and practically possible solution". "It's a matter of destiny for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do afterwards. That's why we have to succeed in a week's time". While Russia is adamant its money should not be touched, there are additional apprehensions among EU officials that the US may want to use Russia's frozen billions differently, as part of its own peace initiative. Zelensky has indicated Ukraine is in discussions with Europe and the US on a recovery fund, but he is also aware the US has been talking to Russia about possible partnership. An initial document of the US peace plan mentioned $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving
Kyiv remains running out of financial resources to keep going its armed forces and economy, after almost four years of the ongoing invasion by Moscow. From the EU's perspective, the remedy to filling Ukraine's budget hole of €135.7bn for the coming 24 months is found in Moscow's immobilized funds located within Belgian bank Euroclear, and Brussels aim to sign that off at their Brussels summit next week. Authorities in Russia state the EU plan would be an confiscation, and the Central Bank of Russia stated on Friday it was taking to court Euroclear in a Moscow court even before a conclusive plan is made. 'Appropriate' to Employ Russia's Assets, Say Ukraine and the EU In total, Russia has roughly €210bn of its funds immobilized in the EU, and €185bn of that is in the custody of Euroclear. European and Ukrainian authorities argue that that capital should be used to rebuild what Russia has destroyed: The European Commission terms it a "reparations loan" and has come up with a plan to prop up Ukraine's economy amounting to €90bn. "It is only just that the assets frozen from Russia should be used to rebuild what Russia has devastated – and that money then becomes Ukraine's," says Ukraine's Volodymyr Zelensky. German Chancellor Friedrich Merz states the assets will "help Ukraine to protect itself effectively against subsequent Russian attacks". Russia's court action was foreseen in Brussels. But it is not only Moscow that is unhappy. The Belgian government is concerned it will be left with an massive bill if it all backfires, and Euroclear CEO Valérie Urbain warns using the assets could "disrupt the international financial system". Euroclear also has an estimated €16-17bn immobilised in Russia. The leader of Belgium Bart de Wever has presented the EU with a series of "rational, reasonable, and justified conditions" before he will endorse the reconstruction loan scheme, and he has left open the possibility of legal action if it "poses significant risks" for his country. Explaining the EU's Strategy? The EU is racing against time prior to next Thursday's summit to finalize a solution that Belgium can support. Previously the EU has refrained from accessing the frozen capital directly but since last year has paid the "windfall profits" from them to Ukraine. In 2024 that amounted to €3.7bn. From a legal standpoint, using the profits is deemed less risky as Russia is under sanction and the returns are not property of the Russian state. But foreign defense assistance for Ukraine has declined sharply in 2025, and Europe has found it difficult to make up the shortfall resulting from the US decision to largely cease funding Ukraine under President Donald Trump. There are at the moment two EU plans aimed at providing Ukraine with €90bn, to cover two-thirds of its financial requirements. One is to raise the money on capital markets, backed by the EU budget as a guarantee. This is Belgium's preferred option but it requires a consensus by EU leaders and that would be problematic when Budapest and Bratislava object to funding Ukraine's military. This makes the other option providing a loan of Ukraine cash from the Russian assets, which were at first held in securities but have now predominantly turned into cash. That funding is Euroclear property located within the European Central Bank. The EU's executive accepts Belgium has valid worries and says it is confident it has resolved them. The proposal is for Belgium to be protected with a assurance covering all the €210bn of Russian assets in the EU. Should Euroclear incur losses of its own assets in Russia, that would be offset from assets belonging to Russia's own clearing house which are in the EU. If Russia targeted Belgium itself, any ruling 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 permanently. Heretofore they have had to vote all together every six months to extend the freeze, which could have meant a ongoing 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 "direct danger to the financial well-being of the union" continues. Why Belgium is Still Not Satisfied Belgium is firm it remains a staunch ally of Ukraine, but sees regulatory pitfalls in the plan and worries about being forced to deal with the fallout if things do not work out. A normally divided political landscape in this case has come together in support of Prime Minister Bart de Wever, who is being pressured from fellow EU leaders. "Belgium has a modest-sized economy. Belgian GDP is about €565bn – imagine if it would need to bear a €185bn bill," says Veerle Colaert, professor of financial law at KU Leuven University. While the EU might be able to arrange enough assurances for the loan itself, Belgium worries about an added risk of being exposed to extra fines or liabilities. Prof Colaert also believes the requirement for Euroclear to grant a loan to the EU would contravene EU banking regulations. "Lenders need to follow stability regulations and shouldn't make one enormous loan. Now the EU is instructing Euroclear to do exactly that. "Why do we have these banking laws? It's because we want banks to be stable. And if things go wrong it would be up to Belgium to bail out Euroclear. That's an additional reason why it's so vital for Belgium to secure water-tight guarantees for Euroclear." Europe Under Pressure from Multiple Fronts The situation is urgent, caution a group of EU member states including those closest to Russia such as the Baltics, Finland and Poland. They argue the proposal to use Russian funds is "the fiscally viable and practically possible solution". "It's a matter of destiny for us," states leading German conservative MP Norbert Röttgen. "If we fail, I don't know what we'll do afterwards. That's why we have to succeed in a week's time". While Russia is adamant its money should not be touched, there are additional apprehensions among EU officials that the US may want to use Russia's frozen billions differently, as part of its own peace initiative. Zelensky has indicated Ukraine is in discussions with Europe and the US on a recovery fund, but he is also aware the US has been talking to Russia about possible partnership. An initial document of the US peace plan mentioned $100bn of Russia's immobilized capital being used by the US for reconstruction, with the US {taking|receiving