🔗 Share this article Moscow Demands Substantial Sum in Damages from Euroclear Regarding Seized Assets Russia's monetary authority has stated it is claiming damages amounting to $230 billion against the securities depository Euroclear. This move represents a direct response by the Kremlin regarding proposals to utilize immobilized Russian state assets to support Ukraine. The Legal Claim According to reports in Russian news outlets, the monetary authority initiated a claim last week for roughly 18 trillion roubles. This sum is equivalent to the stated $230 billion claim. European Union officials are set to decide later this week regarding a plan to leverage around €210 billion in frozen Russian state funds. This scheme entails providing Ukraine with a large loan to fund its defence and economic stability. Most of these assets, amounting to €185 billion, are held at the Euroclear depository in Brussels. Euroclear acts as the primary keeper for the Kremlin's immobilised sovereign wealth. Divergent Legal Views European Union authorities have argued that their proposal is legally sound. Their position rests on the principle that title of the state assets remains with Russia, despite being it was frozen in EU jurisdictions shortly after the full-scale invasion of Ukraine. The Russian government, in contrast, has labeled any utilization of the assets as theft. Authorities have threatened retaliatory actions, such as confiscating European corporate holdings within Russia. The head of Russia's sovereign wealth fund, who has assumed a prominent role in peace negotiations, stated on X that Russia "will win in court" and retrieve its assets. He added that the EU, the euro, and Euroclear "will face consequences" from the plan. Geopolitical Maneuvering In comments interpreted as an attempt to drive a wedge between Europe and the United States, the official described the assets plan as "a severe attack on the right to ownership and the international reserves system established by the United States." The clearing house declined to comment on the new lawsuit. It has in the past noted it is contending with more than 100 legal cases in Russian jurisdictions. Enforcement Challenges While courts in European nations are not expected to recognize rulings from Russian courts, analysts anticipate Moscow to pursue implementation in countries with stronger ties to the Kremlin. "The Bank of Russia may attempt to enforce a Russian legal ruling against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other sympathetic states, if relevant assets can be identified," commented a lawyer from an international firm. European Safeguards EU officials indicated they are working on steps to deter other countries from aiding any Russian legal action against European entities. They are also designing protections to protect EU member states with assets in Russia from what they call "unlawful expropriation." The Proposed Loan Mechanism According to the detailed scheme, the EU would provide an initial €90 billion loan to Ukraine, backed by the proceeds generated from the immobilized assets at Euroclear. Critically, Russia's legal claim on the principal funds would stay unaffected. Kyiv would only be obligated to return the loan in the event that Russia agreed to pay reparations for the vast damage caused during the nearly four-year conflict. Other Funding Ideas The Belgian government, supported by Italy, Bulgaria, and Malta, has urged the EU to examine an alternative method for funding Ukraine. This involves common EU debt issuance to fund a loan, using unallocated funds within the EU budget. Such a proposal, nevertheless, requires unanimity among all 27 EU countries. Hungary's government, viewed as friendly with the Kremlin, has previously signaled its objection. Commenting on Monday, the EU foreign policy chief, a senior official, said the proposed loan scheme as "the most credible option" for supporting Ukraine. "This mechanism is based on the Russian frozen assets, which means it doesn't come from our public funds, which is equally significant," she remarked. "It also delivers a powerful signal that if you do all this damage to another nation, you have to pay for the rebuilding."