🔗 Share this article Moscow Demands Substantial Sum in Damages from Euroclear Regarding Seized Assets The Russian central bank has declared it is seeking damages totaling $230 billion from the securities depository Euroclear. This move constitutes a clear response by the Kremlin regarding proposals to utilize immobilized Russian state funds to aid Ukraine. The Substantial Demand Based on reports in Russian state media, the monetary authority initiated a lawsuit last week for approximately 18 trillion roubles. This figure corresponds to the stated $230 billion demand. European Union officials will decide later this week regarding a plan to leverage around €210 billion in frozen Russian state funds. This scheme entails granting Ukraine with a substantial loan to fund its military and economic needs. Most of these funds, totaling €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 officials have maintained that their plan is legally sound. Their position rests on the principle that ownership of the sovereign wealth remains with Russia, despite being it was immobilized in European countries following the 2022 invasion of Ukraine. Moscow, in contrast, has labeled any use of the assets as illegal appropriation. Authorities have warned of retaliatory actions, including confiscating EU private investors' 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 win in court" and regain its assets. He warned that the European Union, the euro, and Euroclear "will suffer" from the proposal. Geopolitical Maneuvering In comments interpreted as an effort to create division between Europe and the United States, Dmitriev described the assets plan as "a severe attack on the right to ownership and the global financial system established by the United States." Euroclear declined to provide a statement on the latest lawsuit. The institution has in the past noted it is contending with more than 100 lawsuits in Russian courts. Legal Hurdles Ahead While judges in EU countries are unlikely to recognize rulings from Russian courts, experts expect Moscow to pursue enforcement in nations with stronger ties to the Kremlin. "The Bank of Russia could try to enforce a Russian court's decision against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other friendly states, provided that such assets can be located," stated a legal expert from an international firm. EU Countermeasures EU officials indicated they are working on 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 term "illegal 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 remain untouched. Kyiv would only be obligated to return the loan if and when Russia agreed to pay reparations for the immense destruction caused during the ongoing war. Other Funding Ideas Belgium, supported by Italy, Bulgaria, and Malta, has asked the EU to consider an different method for funding Ukraine. This involves common EU borrowing to secure a loan, using unused funds within the EU budget. Such a proposal, however, requires unanimity among all 27 member states. The Hungarian government, considered friendly with the Kremlin, has previously expressed its opposition. Speaking on Monday, the EU foreign policy chief, Kaja Kallas, described the proposed loan scheme as "the strongest option" for supporting Ukraine. "The reparations loan is based on the Russian frozen assets, which means it doesn't come from our taxpayers' money, which is equally significant," she stated. "Furthermore, it sends a clear signal that when you do all this destruction to another country, you have to pay for the rebuilding."