The European Commission is taking significant steps to assure Belgium that it will not face retaliation from the Russian government if approximately €140 billion in Russian assets, currently held in a bank in Brussels, are seized and redirected to support Ukraine.
In a memo accompanying a letter addressed to EU member states on Monday, European Commission President Ursula von der Leyen emphasized the EU’s commitment to share the burdens posed by potential Russian backlash in the years ahead. This reassurance comes at a critical juncture as Belgium grapples with the implications of its involvement in the management of these assets.
Belgium’s concerns and demands
In a notable concession to Belgian Prime Minister Bart De Wever, the Commission articulated that EU nations would assume risks associated with the situation not only during the immobilization of the assets but also after it has been lifted. Belgium has expressed significant apprehension that utilizing these assets could expose it to legal challenges from Russia, both domestically and internationally, given that the sanctioned funds are located in Euroclear, a Brussels-based financial depository.
De Wever is advocating for financial guarantees from other EU countries to shield Belgium from legal repercussions that could arise from actions taken by the Kremlin’s legal representatives. These representatives could potentially convince courts to mandate the return of the funds to Russia. This concern is heightened by Belgium’s long-standing bilateral investment treaty with Russia, which was established in 1989.
“The guarantees would also relate to risks stemming from bilateral investment treaties that are linked to the immobilisation of the Russian sovereign assets,” von der Leyen stated in her memo.
Alternative financing options for Ukraine
The memo also outlines two alternative financing strategies that the EU could consider if the Russian assets are not utilized for the intended loan. Both alternatives would require the EU to independently finance aid to Ukraine without relying on the seized assets.
Von der Leyen’s letter follows a meeting with De Wever last Friday, which was part of ongoing discussions aimed at navigating the complexities surrounding the use of Russian assets. The dialogue underscores the EU’s commitment to collective action while addressing individual member states’ concerns amid rising geopolitical tensions.