🔗 Share this article Moscow Demands Significant Sum in Damages from Euroclear Regarding Frozen Funds Russia's monetary authority has announced it is seeking damages amounting to $230 billion against the securities depository Euroclear. This move constitutes a direct response by the Kremlin regarding plans to utilize frozen Russian sovereign assets to support Ukraine. The Legal Claim According to reports in Russian state media, the monetary authority filed a lawsuit last week for roughly 18 trillion roubles. This figure corresponds to the aforementioned $230 billion demand. EU leaders will determine in the coming days regarding a plan to use approximately €210 billion in immobilized Russian assets. This scheme entails granting Ukraine with a substantial loan to finance its military and economic needs. The vast majority of these funds, totaling €185 billion, reside at the Euroclear depository in Brussels. Euroclear acts as the primary keeper for the Kremlin's frozen financial reserves. Divergent Legal Views EU authorities have maintained that their proposal 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 European countries following the full-scale invasion of Ukraine. Moscow, however, has labeled any utilization of the assets as illegal appropriation. Authorities have warned of retaliatory actions, such as seizing EU corporate holdings within Russia. The head of Russia's sovereign wealth fund, a figure who has taken on a key role in diplomatic talks, stated on X that Russia "will prevail in court" and regain its funds. He warned that the European Union, the common currency, and Euroclear "will suffer" from the plan. Strategic Positioning In comments seen as an attempt to drive a wedge between Europe and the United States, Dmitriev characterized the assets plan as "a severe attack on property rights and the international reserves system created by the United States." The clearing house declined to provide a statement on the latest lawsuit. It has previously stated it is contending with more than 100 legal cases in Russian courts. Legal Hurdles Ahead While judges in European nations are unlikely to recognize judgments from Russian courts, experts anticipate Moscow to seek implementation in nations with closer relations to the Kremlin. "The Bank of Russia may attempt to implement a Russian court's decision against Euroclear in countries such as China, Hong Kong, the UAE, Kazakhstan, and other sympathetic states, provided that relevant holdings can be identified," commented a lawyer from an NSP law firm. EU Countermeasures European authorities said they are developing measures to deter other nations from aiding any Russian legal action against EU entities. Additionally, they are designing protections to shield EU countries with assets in Russia from what they call "illegal expropriation." How the Funding Would Work Under the complex plan, the EU would provide an initial €90 billion loan to Ukraine, using the proceeds generated from the immobilized assets at Euroclear. Critically, Russia's legal claim on the principal funds would remain unaffected. Kyiv would only be obligated to return the loan if and when Russia consented to pay reparations for the immense destruction inflicted during the nearly four-year conflict. Alternative Proposals Belgium, supported by Italy, Bulgaria, and Malta, has urged the EU to examine an alternative method for financing Ukraine. This entails joint EU borrowing to secure a loan, using unallocated funds within the EU budget. Such a proposal, however, requires full agreement among all 27 EU countries. The Hungarian government, considered friendly with the Kremlin, has previously signaled its opposition. Speaking on Monday, the EU top diplomat, a senior official, described the reparations loan as "the most credible solution" for supporting Ukraine. "The reparations loan is based on the Russian immobilized funds, meaning it doesn't come from our taxpayers' money, which is equally significant," she remarked. "Furthermore, it sends a clear signal that if you do all this damage to another nation, you have to pay for the reparations."