🔗 Share this article Moscow Demands Substantial Sum in Damages from Euroclear over Seized Assets Russia's monetary authority has announced it is seeking damages valued at $230 billion against the securities depository Euroclear. This move constitutes a direct warning by the Kremlin against proposals to utilize immobilized Russian state funds to support Ukraine. The Substantial Demand According to reports in local state media, the central bank filed a lawsuit last week for approximately 18 trillion roubles. This figure corresponds to the aforementioned $230 billion demand. EU leaders will determine in the coming days on a plan to use approximately €210 billion in immobilized Russian assets. This scheme entails providing Ukraine with a large loan to finance its military and economic stability. Most of these funds, amounting to €185 billion, are stored at the Euroclear clearing house in Brussels. Euroclear acts as the primary keeper for the Russian frozen sovereign wealth. Dispute on Ownership European Union officials have maintained that their plan is on solid legal ground. They argue is based on the principle that ownership of the sovereign wealth remains with Russia, despite being it was immobilized in European countries shortly after the 2022 military offensive of Ukraine. Moscow, in contrast, has labeled any utilization of the assets as theft. Authorities have warned of reciprocal actions, such as confiscating European corporate holdings within Russia. Kirill Dmitriev, who has assumed a key position in diplomatic talks, stated on a social media platform that Russia "will prevail in court" and retrieve its assets. He added that the EU, the common currency, and Euroclear "will suffer" from the plan. Geopolitical Maneuvering In comments interpreted as an attempt to create division between Europe and the United States, Dmitriev described the assets plan as "a vicious attack on property rights and the international reserves system established by the United States." The clearing house declined to provide a statement on the new lawsuit. It has in the past noted it is facing over 100 lawsuits in Russian courts. Enforcement Challenges Although courts in EU countries are unlikely to enforce judgments from Russian courts, analysts expect Moscow to pursue implementation in countries with closer relations 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 sympathetic nations, provided that relevant holdings can be located," commented a legal expert from an NSP law firm. European Safeguards EU officials indicated they are developing steps to deter other countries from assisting any Russian lawsuits against European entities. They are also designing safeguards to shield EU member states with investments in Russia from what they term "illegal expropriation." How the Funding Would Work According to the detailed scheme, the EU would provide an first €90 billion loan to Ukraine, using the cash earned from the immobilized assets at Euroclear. Critically, Russia's legal claim on the principal funds would remain unaffected. Kyiv would solely be required to return the loan in the event that Russia consented to pay reparations for the vast damage caused during the nearly four-year conflict. Other Funding Ideas Belgium, backed by Italy, Bulgaria, and Malta, has urged the EU to examine an different approach for financing Ukraine. This entails joint EU borrowing to fund a loan, using unallocated funds within the EU budget. Such a proposal, however, demands unanimity among all 27 member states. The Hungarian government, considered aligned with the Kremlin, has already expressed its opposition. Commenting on Monday, the EU top diplomat, a senior official, described the proposed loan scheme as "the most credible solution" for supporting Ukraine. "The reparations loan is based on the Russian frozen assets, meaning it doesn't come from our public funds, which is also significant," she remarked. "It also delivers a powerful signal that if you do all this damage to another country, you have to pay for the rebuilding."