🔗 Share this article Moscow Demands Staggering Sum in Compensation from Euroclear Regarding Frozen Funds Russia's monetary authority has declared it is claiming compensation valued at $230 billion against the securities depository Euroclear. This move represents a direct response from the Kremlin regarding plans to utilize frozen Russian state assets to aid Ukraine. The Financial Lawsuit According to accounts in Russian state media, the monetary authority filed a lawsuit last week for approximately 18 trillion roubles. This amount corresponds to the stated $230 billion demand. European Union officials are set to determine in the coming days regarding a plan to leverage approximately €210 billion in immobilized Russian assets. This scheme entails granting Ukraine with a substantial loan to finance its defence and economic stability. Most of these assets, amounting to €185 billion, are held at the Euroclear depository in Brussels. This institution acts as the main keeper for the Kremlin's immobilised sovereign wealth. A Clash Over Legality EU authorities have argued that their plan is on solid legal ground. Their position is based on the fact that ownership of the state assets remains with Russia, even though it was immobilized in EU jurisdictions shortly after the full-scale military offensive of Ukraine. Moscow, however, has labeled any utilization of the funds as illegal appropriation. Authorities have threatened retaliatory measures, including confiscating EU corporate assets within Russia. Kirill Dmitriev, a figure who has assumed a key position in diplomatic talks, stated on X that Russia "will prevail in court" and retrieve its assets. He warned that the European Union, the euro, and Euroclear "will suffer" from the plan. Geopolitical Maneuvering In comments interpreted as an attempt to drive a wedge between Europe and the United States, the official described the proposal as "a severe assault on property rights and the global financial system established by the United States." Euroclear refused to provide a statement on the new legal action. The institution has in the past stated it is contending with over 100 lawsuits in Russian courts. Enforcement Challenges Although judges in EU countries are unlikely to enforce judgments from Russian courts, experts anticipate Moscow to seek enforcement in nations with stronger ties to the Kremlin. "The Bank of Russia could try to implement a Russian legal ruling against Euroclear in countries such as China, Hong Kong, the UAE, Kazakhstan, and other sympathetic nations, if relevant holdings can be located," commented a legal expert from an NSP law firm. EU Countermeasures European authorities indicated they are developing measures to discourage other nations from aiding any Russian lawsuits against European companies. Additionally, they are crafting safeguards to shield EU countries with assets in Russia from what they term "unlawful 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 frozen assets at Euroclear. Importantly, Russia's ownership claim on the underlying funds would stay untouched. Kyiv would solely be obligated to return the loan if and when Russia consented to pay compensation for the vast destruction inflicted during the nearly four-year war. Alternative Proposals Belgium, backed by Italy, Bulgaria, and Malta, has asked the EU to examine an alternative approach for financing Ukraine. This entails common EU borrowing to fund a loan, backed by unused funds within the European budget. Such a proposal, nevertheless, requires full agreement among all 27 member states. The Hungarian government, considered aligned with the Kremlin, has previously expressed its objection. Commenting on Monday, the EU top diplomat, Kaja Kallas, said the proposed loan scheme as "the most credible option" for supporting Ukraine. "This mechanism is based on the Russian immobilized funds, which means it doesn't come from our taxpayers' money, which is equally significant," she remarked. "It also sends a clear message that if you cause all this destruction to another country, you must pay for the rebuilding."