🔗 Share this article Russia Seeks Substantial Sum in Damages from Clearing House over Frozen Assets The Russian central bank has declared it is claiming damages amounting to $230 billion against the securities depository Euroclear. This action constitutes a clear response from the Kremlin against proposals to use frozen Russian sovereign funds to support Ukraine. The Legal Claim According to reports in local state media, the central bank filed a claim last week for approximately 18 trillion roubles. This sum corresponds to the stated $230 billion claim. European Union officials will determine in the coming days on a proposal to leverage around €210 billion in immobilized Russian assets. This scheme entails granting Ukraine with a substantial loan to fund its defence and financial needs. The vast majority of these funds, totaling €185 billion, are stored at the Euroclear clearing house in Brussels. Euroclear acts as the main 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 fact that ownership of the state assets still belongs to Russia, despite being it was immobilized in EU countries following the 2022 military offensive of Ukraine. Moscow, however, has labeled any use of the assets as theft. It has warned of retaliatory measures, such as seizing European corporate assets within Russia. The head of Russia's sovereign wealth fund, a figure who has assumed a key role in diplomatic talks, wrote on X that Russia "will prevail in court" and regain its assets. He warned that the EU, the euro, and Euroclear "will suffer" from the proposal. Strategic Positioning In comments interpreted as an effort to create division between Europe and the United States, the official described the assets plan as "a vicious attack on property rights and the global financial system created by the United States." Euroclear refused to comment on the latest legal action. The institution has in the past stated it is facing over 100 lawsuits in Russian jurisdictions. Enforcement Challenges Although judges in European nations are not expected to enforce judgments from Russian courts, analysts expect Moscow to pursue implementation in countries with closer ties to the Kremlin. "The Bank of Russia may attempt to implement a Russian court's decision against Euroclear in jurisdictions like China, Hong Kong, the UAE, Kazakhstan, and other sympathetic states, provided that relevant holdings can be located," stated a lawyer from an international firm. European Safeguards EU officials indicated they are developing measures to discourage other countries from aiding any Russian legal action against EU companies. They are also designing protections to shield EU countries with investments in Russia from what they call "unlawful expropriation." The Proposed Loan Mechanism According to the complex plan, the EU would issue an initial €90 billion loan to Ukraine, using the proceeds generated from the frozen assets at Euroclear. Importantly, Russia's ownership claim on the principal funds would remain unaffected. Ukraine would solely be obligated to repay the loan in the event that Russia agreed to pay compensation for the immense destruction caused during the nearly four-year war. Other Funding Ideas Belgium, backed by Italy, Bulgaria, and Malta, has asked the EU to examine an alternative approach for funding Ukraine. This involves common EU borrowing to secure a loan, using unused funds within the European budget. Such a proposal, however, demands unanimity among all 27 EU countries. The Hungarian government, viewed as aligned with the Kremlin, has previously expressed its opposition. Speaking on Monday, the EU top diplomat, Kaja Kallas, described the proposed loan scheme as "the most credible solution" for aiding Ukraine. "The reparations loan is based on the Russian immobilized funds, which means it is not drawn from our taxpayers' money, which is also significant," she stated. "Furthermore, it delivers a powerful signal that if you do all this destruction to another nation, you have to pay for the reparations."