The European Union has agreed to indefinitely freeze Russia’s sovereign assets held in the bloc, as Moscow escalates threats to retaliate against Euroclear, the Brussels-based securities depository responsible for safeguarding most of the immobilised funds.
The move, which uses emergency powers to immobilise €210bn (£185bn) of Russia’s central bank reserves, marks a significant step towards channelling the money to support Ukraine’s defence. European Council president António Costa confirmed on Friday that EU leaders had fulfilled their October pledge to “keep Russian assets immobilised until Russia ends its war of aggression against Ukraine and compensates for the damage caused”.
Previously, sanctions underpinning the frozen assets required renewal every six months, leaving open the possibility of a veto from governments sympathetic to Moscow, such as Hungary.
Hours before the announcement, Russia’s central bank revealed it was filing a lawsuit against Euroclear in a Moscow court, accusing the organisation of “illegal actions” that had damaged its ability to manage funds and securities. Euroclear declined to comment but said it was currently facing more than 100 legal claims in Russia.
The decision comes as the European Commission pushes a €90bn (£79bn) loan for Ukraine, secured against the frozen assets. Belgium has blocked the plan, warning of potential lawsuits and the risk of Russian retaliation against Belgian assets.
Belgian prime minister Bart De Wever met UK prime minister Keir Starmer in Downing Street on Friday for talks covering migration, EU-UK relations and the Russian assets. Both sides issued statements stressing the need to maintain economic pressure on Moscow and to strengthen Ukraine’s position in pursuit of a lasting peace.
The debate over the assets will continue at next week’s EU summit, where leaders are expected to decide on funding Ukraine for 2026-27. Officials warn Kyiv could run out of money by spring, jeopardising its ability to pay soldiers, doctors and teachers.
EU officials argue the proposed loan would cover two-thirds of Ukraine’s financial needs over the next two years, with other international partners expected to provide the remainder. Belgium insists it must receive guarantees that it will not bear the cost of any successful Russian lawsuits.
De Wever has described the plan as “fundamentally wrong”, claiming it would breach international law and threaten eurozone stability. Belgium, along with Bulgaria, Malta and Italy, has urged that only EU leaders should decide on the use of immobilised assets, while continuing to explore alternative options.
Germany has backed the frozen assets plan, pledging €50bn in guarantees to reassure Belgium. EU officials maintain that the legal risk to Euroclear, and therefore Belgium, would be limited.
Under the scheme, the EU would borrow cash from Euroclear and loan it to Ukraine, while Russia would remain the legal owner of the assets. Ukraine would only repay the funds if Moscow eventually paid reparations for the war.
The UK, which holds €27bn (£23bn) of frozen Russian assets, supports the proposal and expects some G7 countries to adopt similar measures. US participation remains uncertain, with Washington holding a comparatively modest €4bn (£3.5bn) in immobilised assets.