What's happened
EU leaders are set to approve a plan to indefinitely freeze Russian assets held in Europe, enabling the use of these funds to support Ukraine. The move aims to bypass opposition from Hungary and Slovakia, with plans to leverage the assets for a large loan to Ukraine, amid legal disputes and political controversy.
What's behind the headline?
The EU's decision to make the asset freeze indefinite marks a significant shift in sanctions policy, aiming to strengthen support for Ukraine amid ongoing conflict. This move effectively bypasses Hungary and Slovakia’s opposition, which argued it violates legal principles and could jeopardize peace efforts. The EU’s rationale is rooted in economic necessity, citing the war’s costs on energy prices and growth. However, critics like Hungary’s Prime Minister Orbán see this as an overreach, accusing the EU of 'systematically raping European law.' The legal disputes, including Russia’s lawsuit against Euroclear, highlight the complex intersection of international law, sovereignty, and economic sanctions. The outcome will likely influence future asset freezes and the EU’s ability to leverage frozen assets for geopolitical aims, setting a precedent for other sanctions regimes. The next steps will depend on the European Council’s approval and potential legal challenges, which could shape the broader conflict’s financial landscape.
What the papers say
The Moscow Times reports that the move removes a major hurdle to using Russian assets to support Ukraine, with EU leaders aiming to finalize the plan at a summit on December 18. Al Jazeera highlights that at least 15 of 27 EU states support the indefinite freeze, with opposition from Hungary and Slovakia, who warn it could undermine legal principles and peace efforts. The Independent emphasizes that the decision is a crucial step toward leveraging billions in Russian assets for Ukraine’s needs, despite fierce opposition from Orbán, who claims it violates European law. AP News notes that this is a historic move, with EU leaders considering using frozen assets for the first time to fund Ukraine, with the potential to unlock €135 billion in IMF estimates of Ukraine’s needs. The contrasting opinions reflect the tension between economic support and legal sovereignty, with some viewing the plan as necessary for Ukraine’s survival and others as an overreach that risks legal and diplomatic fallout.
How we got here
Since Russia's invasion of Ukraine in 2022, the EU has frozen approximately €210 billion in Russian assets, mainly held in Euroclear. These sanctions require renewal every six months, with opposition from Hungary and Slovakia. The EU now seeks to extend the freeze indefinitely and use the assets to fund Ukraine’s military and civilian needs, including a proposed loan backed by reparations from Russia. The move follows legal challenges from Russia’s Central Bank and debates over legality and sovereignty.
Go deeper
Common question
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What is the EU’s plan to seize Russian assets to support Ukraine?
The European Union is considering a bold move to freeze and potentially seize Russian assets held in Europe to help fund Ukraine’s recovery. This unprecedented step aims to use frozen assets to support Ukraine’s military and economic rebuilding efforts amid ongoing tensions. But what does this mean for international law, EU politics, and Russia’s response? Below, we explore the key questions surrounding this controversial plan.
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How Does the Ukraine-Russia Conflict Impact Global Stability?
The ongoing conflict between Ukraine and Russia has far-reaching effects beyond the battlefield. From security concerns to economic repercussions and international diplomacy, this crisis influences global stability in complex ways. Curious about how this war shapes our world? Below are key questions and answers to help you understand the broader implications of the Ukraine-Russia conflict.
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Is Seizing Russian Assets Legal Under International Law?
The EU's move to freeze and potentially seize Russian assets to support Ukraine has sparked widespread debate. Many wonder whether such actions are legally permissible under international law, and what implications they might have for global legal standards. Below, we explore the legal and ethical questions surrounding asset seizures in conflict zones, including the potential consequences for international relations and future conflicts.
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The European Union is a political and economic union of 27 member states that are located primarily in Europe. Its members have a combined area of 4,233,255.3 km² and an estimated total population of about 447 million.
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Viktor Mihály Orbán is a Hungarian politician who has been Prime Minister of Hungary since 2010; he was also Prime Minister from 1998 to 2002.
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