Plans by the EU to confiscate Russian assets in response to Moscow’s invasion of Ukraine, with a focus on state assets valued at about $350 billion, are unprecedented and challenging, the chairman of the EU task force told AFP on Friday (24 March).
According to Swedish career diplomat Anders Ahnlid, “nothing is straightforward” when it comes to locating the enormous monies meant to be redirected to pay for Ukraine’s rehabilitation.
Yet he said that Europe intended to be “creative.”
There is a mountain of riches to be had, from the yachts of billionaires to the foreign reserves of the Russian central bank, but seizing it legally is more difficult said than done.
A week after the first meeting of the EU working group, Ahnlid observed, “It is difficult to find acceptable legal procedures.
The sanctions have been disputed in court by a large number of Russian citizens.
Early in March, the EU General Court issued an interim order postponing some of the sanctions against Russian Formula One racer Nikita Mazepin in one prominent instance. He is the owner and chief executive officer of the Uralchem chemical products company.
Ahnlid stated that this “simply proves that our European Union is a unity based on the rule of law.”
For the first time, the EU intends to confiscate the assets as well as freeze them, redistributing the capital—or at least the interest—in the process.
Except for the Iraqi assets that the US took at the end of Saddam Hussein’s administration, Ahnlid remarked that precedents are uncommon even at the international level.
Yet these are difficult issues. Both immediate and long-term effects will result from what we’re doing.
To advance, the task team will need to “be a little creative,” he said.
Law professionals distinguish between official property, such as Russia’s central bank’s foreign exchange reserves, and privately owned property, such as an oligarch’s yacht, that has been frozen by Western countries.
The EU estimates that Russia’s foreign exchange reserves alone total about $300 billion. State assets are also typically bigger and simpler to legally seize.