Euroclear, the Belgium based international financial services company, is set to redistribute €3 billion (approximately £2.6 billion or $3.2 billion) of frozen Russian assets to Western investors. This action is part of a growing response by the European Union to hold the Kremlin financially accountable for its full scale invasion of Ukraine that began in February 2022.
The funds, frozen under European Union sanctions against the Russian dictatorship, belong to Russian entities and individuals with direct ties to the war. The €3 billion is part of a larger €10 billion (£8.6 billion) cash pool held by Euroclear. According to sources cited by Reuters, this money will be used to compensate investors in the West who suffered financial losses as a result of Moscow’s actions and the Kremlin’s retaliatory seizures.
In recent months, Russia itself arrested €3 billion of Euroclear’s own funds held in the Russian Federation, claiming it was to offset damages to Russian investors impacted by sanctions. In response, Europe has taken this unprecedented step to seize sanctioned Russian assets and repurpose them. This move is expected to face legal challenges, with more than 100 lawsuits already filed by the Russian side.
Since the start of the invasion, the European Union has frozen hundreds of billions in Russian assets, including a significant portion of central bank reserves. Euroclear alone holds more than €180 billion (£155 billion) in frozen Kremlin-linked assets. While some critics have labelled the redistribution of Russian funds to investors as controversial, many see it as a necessary and strategic step towards economic justice.
The Russian dictatorship, led by Vladimir Putin, has reacted sharply to these developments. Last year, the regime warned that any Western seizure of Russian money for Ukraine or Western interests would be met with retaliation. However, the European Union’s position has only hardened, with more governments calling for frozen Russian wealth to be used to rebuild Ukraine and support those harmed by the war.
Meanwhile, Ukraine has appealed to the international community for greater assistance, including the redirection of frozen Kremlin assets to support Ukrainian air defences, military investment and civilian reconstruction.
