🔗 Share this article Moscow Demands Significant Sum in Compensation from Clearing House Regarding Frozen Assets The Russian central bank has stated it is seeking damages amounting to $230 billion from the securities depository Euroclear. This move constitutes a direct response from the Kremlin against plans to utilize immobilized Russian state funds to support Ukraine. The Financial Lawsuit Based on reports in Russian state media, the monetary authority initiated a claim last week for roughly 18 trillion roubles. This amount is equivalent to the stated $230 billion demand. EU leaders will decide later this week regarding a proposal to leverage around €210 billion in frozen Russian state funds. This scheme involves providing Ukraine with a substantial loan to fund its defence and economic stability. The vast majority of these funds, amounting to €185 billion, are held at the Euroclear clearing house in Brussels. This institution serves as the main custodian for the Kremlin's frozen sovereign wealth. A Clash Over Legality European Union officials have argued that their proposal is legally sound. Their position rests on the principle that ownership of the sovereign wealth remains with Russia, even though it was immobilized in EU countries shortly after the 2022 invasion of Ukraine. The Russian government, however, has called any use of the assets as illegal appropriation. Authorities have threatened reciprocal measures, including confiscating European private investors' assets within Russia. Kirill Dmitriev, a figure who has taken on a prominent position in diplomatic talks, wrote on X that Russia "will win in court" and regain its funds. He warned that the EU, the common currency, and Euroclear "will face consequences" from the plan. Geopolitical Maneuvering In comments interpreted as an effort to create division between Europe and the United States, Dmitriev characterized the assets plan as "a vicious attack on property rights and the global financial system created by the United States." The clearing house refused to comment on the latest lawsuit. It has previously noted it is facing over 100 legal cases in Russian courts. Legal Hurdles Ahead While courts in European nations are not expected to recognize judgments from Russian tribunals, experts expect Moscow to pursue implementation in countries with closer ties to the Kremlin. "Russian monetary authorities may attempt to enforce a Russian court's decision against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other sympathetic states, provided that such assets can be identified," commented a legal expert from an NSP law firm. European Safeguards European authorities said they are developing measures to deter other countries from aiding any Russian lawsuits against EU companies. They are also designing safeguards to shield EU countries with investments in Russia from what they call "unlawful expropriation." How the Funding Would Work According to the detailed scheme, the EU would issue an first €90 billion loan to Ukraine, using the cash generated from the immobilized assets at Euroclear. Critically, Russia's ownership claim on the underlying funds would stay unaffected. Kyiv would only be obligated to repay the loan in the event that Russia consented to pay compensation for the immense damage caused during the ongoing war. Other Funding Ideas The Belgian government, supported by Italy, Bulgaria, and Malta, has asked the EU to examine an alternative approach for funding Ukraine. This involves common EU borrowing to secure a loan, backed by unallocated funds within the EU budget. This alternative move, however, demands unanimity among all 27 EU countries. The Hungarian government, viewed as friendly with the Kremlin, has already expressed its objection. Speaking on Monday, the EU top diplomat, a senior official, said the reparations loan as "the most credible option" for supporting Ukraine. "The reparations loan is secured against the Russian frozen assets, meaning it is not drawn from our public funds, which is also significant," she stated. "It also delivers a clear message that if you do all this destruction to another country, you must pay for the reparations."