Russia Loses €70 Billion Frozen Sanctions Appeal, With Funds Potentially Allocated to Ukraine

The Russian National Settlement Depository has lost its case challenging the European Union sanctions imposed due to its role in financing the war. As a result, €70 billion could now be used to support Ukraine.

Bloomberg reports this development.

Russian Depository was sanctioned by the EU in 2022 after the bloc asserted that, as a major custodian of Russian securities, the organization allowed the Russian government to mobilize its resources for military activities.

EU judges ruled that the Depository “failed to demonstrate” that the EU was “erred in finding that that undertaking was a systemically important financial institution which played an essential role in the functioning of Russia’s financial system.”

According to a source familiar with the situation, approximately €70 billion is currently frozen at Euroclear, the Belgian clearing house.

While these assets are not yet being used to generate unforeseen profits for transfer as financial aid to Ukraine, this court decision could pave the way for their use and potentially create additional revenues in the future, similar to how the EU has managed assets of the Russian central bank, the source added.

A Euroclear representative confirmed that unforeseen contributions to Ukraine will be received from the Russian central bank's assets starting February 15, 2024.

Euroclear has already made an initial payment of €1.55 billion to the fund for Ukraine. The clearing house holds €173 billion related to sanctioned Russian assets, including frozen assets of the Russian central bank.