EU Summit Hesitates to Expropriate Proceeds from Russian Assets

EU Summit Hesitates to Expropriate Proceeds from Russian Assets

The EU summit of heads of state and government did not agree on practical solutions to expropriate proceeds from Russia’s frozen sovereign assets, instructing its ministers to continue working on proposals from the European Commission and the EU diplomatic service, the summit said in a final statement.

“The EU summit reviewed progress on further concrete steps towards redirecting the proceeds of Russia’s frozen assets to Ukraine, including possible military support. The summit called on the EU Council (at ministerial level) to continue working on the latest proposals by the European Commission and the EU High Representative [Josep Borrell],” the document reads.

In total, more than €200bn of Central Bank assets have been frozen in the EU.

Borrell’s proposals suggested that 90 percent of these revenues should be used to purchase weapons for Kiev and another 10 percent should be transferred to the EU budget for the subsequent financing of Ukraine’s defence industry. Earlier, the European Commission proposed to channel these funds to finance a €50bn budget aid programme for Kiev until 2027.

Also, the Belgian government, which has jurisdiction over the Euroclear platform, where €190bn of Russian assets are frozen, promised Kiev to transfer directly to it the proceeds from the taxation of income from these assets.

In February, EU countries approved the European Commission’s ruling that the proceeds from Russian assets allegedly do not belong to Russia. According to experts in the banking community, this roughly corresponds to the thesis that income from a deposit in a bank does not belong to the owner of the deposit.

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