🔗 Share this article Moscow Demands Substantial Sum in Damages against Clearing House over Seized Assets The Russian central bank has announced it is claiming compensation amounting to $230 billion against the financial institution Euroclear. This legal step represents a clear response by the Kremlin regarding plans to use frozen Russian sovereign funds to support Ukraine. The Legal Claim Based on reports in Russian news outlets, the monetary authority initiated a claim last week for roughly 18 trillion roubles. This figure is equivalent to the stated $230 billion demand. European Union officials are set to decide later this week on a plan to leverage approximately €210 billion in immobilized Russian state funds. The proposal entails granting Ukraine with a substantial loan to fund its military and financial stability. Most of these assets, amounting to €185 billion, reside at the Euroclear clearing house in Brussels. Euroclear acts as the primary keeper for the Russian immobilised financial reserves. A Clash Over Legality EU authorities have maintained that their plan is on solid legal ground. Their position rests on the fact that ownership of the state assets still belongs to Russia, even though it was immobilized in EU jurisdictions following the full-scale invasion of Ukraine. The Russian government, however, has called any utilization of the funds as illegal appropriation. It has threatened retaliatory measures, including seizing European corporate assets within Russia. The head of Russia's sovereign wealth fund, who has assumed a key role in diplomatic talks, stated on X that Russia "will prevail in court" and regain its assets. He warned that the European Union, the euro, and Euroclear "will face consequences" from the plan. Geopolitical Maneuvering With statements interpreted as an effort to drive a wedge between Europe and the United States, Dmitriev characterized the proposal as "a vicious attack on property rights and the international reserves system created by the United States." Euroclear declined to comment on the new lawsuit. It has in the past stated it is facing more than 100 lawsuits in Russian jurisdictions. Enforcement Challenges Although courts in EU countries are unlikely to enforce judgments from Russian courts, analysts expect Moscow to seek implementation in nations with stronger relations to the Kremlin. "The Bank of Russia could try to implement a Russian legal ruling against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other sympathetic states, provided that such holdings can be located," commented a legal expert from an NSP law firm. EU Countermeasures European authorities said they are developing measures to discourage other countries from aiding any Russian legal action against EU entities. Additionally, they are designing protections to shield EU member states with assets in Russia from what they call "unlawful expropriation." How the Funding Would Work According to the detailed scheme, the EU would issue an first €90 billion loan to Ukraine, using the cash generated from the frozen assets at Euroclear. Critically, Russia's ownership claim on the principal funds would stay unaffected. Kyiv would only be obligated to return the loan if and when Russia consented to pay compensation for the immense destruction inflicted during the nearly four-year war. Other Funding Ideas Belgium, backed by Italy, Bulgaria, and Malta, has urged the EU to consider an alternative approach for financing Ukraine. This involves common EU borrowing to fund a loan, backed by unallocated funds within the EU budget. This alternative move, nevertheless, demands unanimity among all 27 member states. The Hungarian government, considered aligned 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 aiding Ukraine. "This mechanism is secured against the Russian frozen assets, meaning it doesn't come from our taxpayers' money, which is equally significant," she stated. "It also sends a powerful message that if you do all this destruction to another nation, you have to pay for the reparations."