Brussels is preparing a legal basis for transferring the seized funds to Ukraine, the European Commission president has said
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The European Commission intends to submit a legal proposal on the transfer of frozen Russian assets to Ukraine before it goes on summer break on July 25, its president, Ursula von der Leyen, told reporters on Wednesday.
According to the official, despite earlier reports to the contrary and the legal challenges the measure faces, the commission is intent on finding ways to use the money in question for the restoration of Ukraine.
“It is not legally a simple thing, it is very complex. Our experts are working hard on it. But I am deeply convinced, from a political point of view, that it is not possible that whoever committed this devastation and destruction in Ukraine does not contribute to the repair and to the reconstruction. For this reason we are preparing a legal proposal before the summer break,” she told representatives of several European news outlets on the sidelines of the conference on the reconstruction of Ukraine, underway in London.
She also mentioned the commission’s proposal to EU member-states to allocate €50 billion ($55 billion) in grants and loans as aid to Ukraine in 2024-2027.
Brussels froze Russia’s EU-held assets soon after the start of Moscow’s military operation in Ukraine late last February. Last month, the European Commission calculated that a total of over €200 billion worth of assets belonging to the Russian central bank were frozen across the bloc, along with some €24.1 billion of assets belonging to sanctioned Russian businessmen and companies.
Lawmakers from across the block have been debating the legality of seizing Russian holdings and channeling them to Ukraine for months now, with many pointing out that the EU legal system only allows freezing these assets, not expropriating them.
Bloomberg reported earlier this week that members of the EU working group on Russian assets saw “no credible legal avenue” for their confiscation “on the sole basis of these assets being under EU restrictive measures.”
Instead, the lawmakers said they could opt to use the profits generated from these assets in EU securities depositories. According to a recent report by Financial Times, one of these depositories, Belgium-based Euroclear, alone generated €734 million in interest on cash balances from Russia-sanctioned assets in the first quarter of 2023.
Moscow has repeatedly condemned the EU’s seizure of its assets as theft. While addressing the St. Petersburg International Economic Forum (SPIEF) last week, Russian President Vladimir Putin described the measure as “medieval.”
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