EU Ambassadors Approve Indefinite Freeze of Russian Assets, Paving Way for Ukraine Reparations

EU ambassadors have approved a measure allowing for the indefinite freezing of Russian assets, a significant step toward potentially using these assets for reparations to Ukraine. This procedural change, which was endorsed by a qualified majority, removes the need for unanimous consent typically required to extend anti-Russian sanctions every six months, as was reported by the Danish EU Presidency, according to a Radio Liberty correspondent on December 11.

The change will ensure that a potential veto, such as from Hungary, cannot unfreeze assets that could serve as the foundation for a reparations loan to Ukraine. Under the new framework, a qualified majority of EU member states will be sufficient to maintain the freeze on these assets, in line with Article 122 of the Treaty on the Functioning of the European Union. The European Commission had proposed this approach to address the economic consequences of Russia’s invasion of Ukraine.

In recent weeks, there has been significant discussion in Europe regarding a “reparations loan” of $140 billion to Ukraine, backed by frozen Russian assets. However, Belgium has raised concerns, especially as the majority of the assets in question are located in its jurisdiction. Belgium is worried about potential legal challenges from Russia.

Belgian Deputy Prime Minister Vincent Van Peteghem reiterated that while frozen Russian assets should be used for Ukraine at some point, Belgium is unwilling to make any hasty compromises on the issue. The European Central Bank has also expressed reluctance to insure such a reparations loan.

Russia has strongly rejected any attempts to confiscate its assets, calling it theft if those assets are used to benefit Ukraine, Radio Liberty wrote.

Previously, it was reported that the finance ministers of the Group of Seven (G7) have welcomed the use of frozen Russian assets to pay reparations to Ukraine, according to the G7’s declaration.

“We will continue to work together to develop a wide range of financing options to support Ukraine, including potentially using the full value of the Russian Sovereign Assets, immobilized in our jurisdictions until reparations are paid for by Russia, to end the war and ensure a just and lasting peace in Ukraine,” the statement reads.

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