🔗 Share this article Russia Seeks Staggering Amount in Compensation against Clearing House over Frozen Assets The Russian central bank has announced it is seeking compensation amounting to $230 billion against the financial institution Euroclear. This legal step constitutes a clear warning from the Kremlin against proposals to use immobilized Russian sovereign assets to aid Ukraine. The Legal Claim According to accounts in Russian news outlets, the monetary authority filed a lawsuit last week for roughly 18 trillion roubles. This figure corresponds to the aforementioned $230 billion claim. EU leaders will decide later this week on a proposal to use approximately €210 billion in immobilized Russian state funds. This scheme entails granting Ukraine with a large loan to finance its defence and financial needs. The vast majority of these assets, totaling €185 billion, are held at the Euroclear clearing house in Brussels. Euroclear acts as the main custodian for the Russian frozen financial reserves. Dispute on Ownership EU officials have maintained that their proposal is legally sound. They argue rests on the fact that ownership of the sovereign wealth still belongs to Russia, even though it was frozen in European jurisdictions shortly after the full-scale military offensive of Ukraine. The Russian government, however, has labeled any use of the funds as illegal appropriation. Authorities have warned of reciprocal measures, including confiscating European private investors' assets within Russia. The head of Russia's sovereign wealth fund, who has assumed a key role in diplomatic talks, wrote on a social media platform that Russia "will win in court" and regain its assets. He warned that the European Union, the euro, and Euroclear "will face consequences" from the plan. Strategic Positioning In comments seen as an attempt to drive a wedge between Europe and the United States, the official characterized the proposal as "a severe assault on property rights and the international reserves system created by the United States." The clearing house declined to comment on the new lawsuit. It has previously stated it is contending with more than 100 lawsuits in Russian jurisdictions. Legal Hurdles Ahead Although courts in EU countries are unlikely to recognize rulings from Russian tribunals, experts expect Moscow to seek implementation in nations with stronger ties to the Kremlin. "Russian monetary authorities may attempt to implement a Russian court's decision against Euroclear in countries such as China, Hong Kong, the UAE, Kazakhstan, and other friendly states, if relevant assets can be located," commented a legal expert from an international firm. European Safeguards European authorities indicated they are developing measures to deter other countries from assisting any Russian legal action against European entities. They are also crafting safeguards to protect EU member states with assets in Russia from what they call "illegal expropriation." How the Funding Would Work According to the detailed scheme, the EU would issue an first €90 billion loan to Ukraine, using the proceeds earned from the immobilized assets at Euroclear. Critically, Russia's ownership claim on the underlying funds would stay unaffected. Kyiv would solely be obligated to repay the loan if and when Russia consented to pay compensation for the vast damage inflicted during the ongoing war. Other Funding Ideas Belgium, supported by Italy, Bulgaria, and Malta, has asked the EU to examine an alternative approach for funding Ukraine. This entails common EU debt issuance to secure a loan, backed by unallocated funds within the European budget. Such a proposal, nevertheless, requires unanimity among all 27 EU countries. The Hungarian government, considered aligned with the Kremlin, has previously signaled its opposition. Commenting on Monday, the EU foreign policy chief, a senior official, said the proposed loan scheme as "the strongest solution" for aiding Ukraine. "The reparations loan is based on the Russian immobilized funds, meaning it is not drawn from our taxpayers' money, which is equally significant," she stated. "It also delivers a powerful message that if you cause all this damage to another country, you have to pay for the reparations."