In light of the ongoing conflict in Ukraine and the growing economic tensions between the West and Russia, the European Union is once again considering the possibility of directly confiscating Russian assets that have been frozen under sanctions. This issue has become particularly pressing as Russia may begin to seize the property of Western investors within its territory.
According to various sources, European officials are discussing possible actions if Moscow moves to actively confiscate the assets of Western companies. It is worth noting that in April of this year, the United States enacted a law allowing the direct seizure of blocked reserves from the Central Bank of Russia. In contrast, the European Union is currently limited in its use of revenues from assets that the Kremlin holds in European securities and bank accounts. However, according to European analysts, this position may change.
The European clearing and depository company Euroclear, which manages billions of euros in private and state assets, may gain the right to use these funds directly if Moscow begins to confiscate the money and property of Western investors. This poses a serious challenge to the financial system, as many Western banks and companies risk losing their assets in Russia. The Russian side has already filed several lawsuits against Euroclear in Russian courts, complicating the situation and increasing risks for Western investors.
According to sources, Euroclear is pressuring the European Commission to provide it with the ability to cover potential losses from possible confiscations. Moreover, a change in the policy regarding the confiscation of Russian assets could allow the European Union to secure “collateral” for a loan of 45 billion euros for Ukraine. This loan is being issued against the frozen Russian assets, highlighting the significance of this issue not only for Europe’s economy but also for supporting Ukraine in its struggle.
The European Union will have to weigh the risks and benefits of the potential confiscation of Russian assets. If Russia indeed begins to seize the property of Western investors, it could catalyze more decisive action from the EU, as Russia utilizes all possible resources to achieve its strategic goals and capture a significant portion of Ukraine.
