🔗 Share this article Russia Seeks Staggering Sum in Damages from Euroclear Regarding Seized Assets Russia's monetary authority has declared it is pursuing compensation amounting to $230 billion against the financial institution Euroclear. This action constitutes a clear response from the Kremlin regarding proposals to utilize frozen Russian sovereign assets to aid Ukraine. The Legal Claim According to accounts in Russian state media, the central bank filed a claim last week for roughly 18 trillion roubles. This amount corresponds to the aforementioned $230 billion demand. EU leaders will determine in the coming days regarding a proposal to use approximately €210 billion in frozen Russian state funds. The proposal entails providing Ukraine with a substantial loan to finance its defence and economic stability. The vast majority of these funds, totaling €185 billion, are held at the Euroclear depository in Brussels. Euroclear acts as the main custodian for the Kremlin's immobilised sovereign wealth. A Clash Over Legality European Union authorities have maintained that their plan is legally sound. Their position rests on the principle that ownership of the state assets still belongs to Russia, despite being it was frozen in EU jurisdictions shortly after the 2022 military offensive of Ukraine. The Russian government, in contrast, has called any utilization of the assets as theft. Authorities have warned of retaliatory actions, such as seizing EU corporate assets within Russia. The head of Russia's sovereign wealth fund, who has assumed a key position in diplomatic talks, stated on a social media platform that Russia "will prevail in court" and retrieve its funds. He warned that the EU, the common currency, and Euroclear "will face consequences" from the plan. Wider Implications With statements seen as an effort to drive a wedge between Europe and the United States, Dmitriev described the assets plan as "a vicious assault on the right to ownership and the global financial system established by the United States." The clearing house declined to comment on the new lawsuit. It has previously noted it is contending with over 100 legal cases in Russian jurisdictions. Legal Hurdles Ahead Although judges in European nations are unlikely to enforce judgments from Russian courts, analysts anticipate Moscow to pursue enforcement in nations with closer relations to the Kremlin. "The Bank of Russia may attempt to implement a Russian legal ruling against Euroclear in countries such as China, Hong Kong, the UAE, Kazakhstan, and other sympathetic nations, provided that such holdings can be located," stated a legal expert from an international firm. EU Countermeasures EU officials said they are working on measures to deter other countries from assisting any Russian legal action against EU companies. Additionally, they are designing safeguards to protect EU countries with assets in Russia from what they term "unlawful expropriation." How the Funding Would Work Under the detailed scheme, the EU would issue an first €90 billion loan to Ukraine, backed by the cash generated from the immobilized assets at Euroclear. Critically, Russia's legal claim on the underlying funds would stay unaffected. Kyiv would solely be required to repay the money in the event that Russia consented to pay reparations for the immense damage inflicted during the ongoing conflict. Other Funding Ideas The Belgian government, backed by Italy, Bulgaria, and Malta, has urged the EU to examine an alternative method for financing Ukraine. This entails common EU debt issuance to fund a loan, backed by unallocated funds within the European budget. This alternative move, however, requires unanimity among all 27 member states. The Hungarian government, considered friendly with the Kremlin, has already signaled its objection. Commenting on Monday, the EU foreign policy chief, Kaja Kallas, described the proposed loan scheme as "the most credible option" for supporting Ukraine. "The reparations loan is secured against the Russian immobilized funds, meaning it is not drawn from our taxpayers' money, which is also important," she stated. "It also sends a powerful signal that if you cause all this destruction to another country, you must pay for the reparations."