🔗 Share this article Russia Seeks Substantial Amount in Compensation from Clearing House over Frozen Funds The Russian central bank has declared it is pursuing damages amounting to $230 billion from the securities depository Euroclear. This move constitutes a direct response from the Kremlin against plans to use immobilized Russian sovereign assets to aid Ukraine. The Legal Claim According to reports in Russian state media, the monetary authority filed a lawsuit last week for approximately 18 trillion roubles. This sum corresponds to the stated $230 billion demand. EU leaders will decide in the coming days on a plan to leverage approximately €210 billion in frozen Russian assets. The proposal involves granting Ukraine with a large loan to fund its military and financial needs. The vast majority of these assets, totaling €185 billion, are stored at the Euroclear clearing house in Brussels. Euroclear serves as the main keeper for the Russian frozen financial reserves. A Clash Over Legality European Union officials have maintained that their proposal is on solid legal ground. They argue is based on the principle that ownership of the sovereign wealth still belongs to Russia, despite being it was frozen in EU countries following the full-scale invasion of Ukraine. Moscow, in contrast, has called any utilization of the assets as theft. Authorities have threatened reciprocal actions, such as confiscating European private investors' holdings within Russia. The head of Russia's sovereign wealth fund, a figure who has assumed a key role in peace negotiations, wrote on a social media platform that Russia "will win in court" and retrieve its assets. He added that the European Union, the common currency, and Euroclear "will face consequences" from the proposal. Geopolitical Maneuvering In comments interpreted as an attempt to drive a wedge between Europe and the United States, the official described the proposal as "a vicious attack on property rights and the international reserves system created by the United States." The clearing house refused to provide a statement on the new legal action. The institution has in the past stated it is contending with over 100 legal cases in Russian courts. Enforcement Challenges Although judges in European nations are unlikely to enforce rulings from Russian courts, analysts expect Moscow to seek enforcement in countries with stronger relations to the Kremlin. "Russian monetary authorities could try to implement a Russian legal ruling against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other friendly states, if such holdings can be located," commented a legal expert from an international firm. EU Countermeasures EU officials said they are working on steps to deter other countries from aiding any Russian legal action against EU companies. They are also designing protections to shield EU countries with assets in Russia from what they call "unlawful expropriation." How the Funding Would Work Under the detailed scheme, the EU would provide an first €90 billion loan to Ukraine, backed by the cash generated from the immobilized assets at Euroclear. Importantly, Russia's legal claim on the principal funds would stay unaffected. Ukraine would only be required to return the loan if and when Russia agreed to pay compensation for the vast destruction caused during the nearly four-year war. Other Funding Ideas The Belgian government, supported by Italy, Bulgaria, and Malta, has urged the EU to examine an different method for funding Ukraine. This involves common EU debt issuance to secure a loan, backed by unused funds within the EU budget. This alternative move, nevertheless, requires unanimity among all 27 member states. Hungary's government, considered aligned with the Kremlin, has already expressed its opposition. Commenting on Monday, the EU top diplomat, Kaja Kallas, said the reparations loan as "the strongest solution" for aiding Ukraine. "This mechanism is secured against the Russian frozen assets, meaning it doesn't come from our taxpayers' money, which is equally important," she stated. "Furthermore, it delivers a powerful signal that when you cause all this destruction to another country, you must pay for the rebuilding."