Bloomberg: EU won't confiscate frozen Russian assets, but expects to send proceeds to Ukraine

The European Union has decided that it cannot legally confiscate Russia's frozen funds in their entirety. Instead, officials are thinking about how to temporarily use these assets to benefit Ukraine.

Source. This is stated in a document obtained by Bloomberg.

The report of the working group on the use of Russian assets states that the EU continues to study how more than 200 billion euros of frozen assets of the Russian Central Bank could be used to help Ukraine's recovery. Currently, most of these funds are held by the Belgian financial company Euroclear, and in the first quarter of this year, interest income on them amounted to about 750 million euros, Bloomberg writes.

So far, the working group does not see "a reliable legal mechanism to confiscate frozen or blocked assets."

Instead, two options are being considered: reinvestment of the Central Bank's assets and sending the proceeds to Ukraine, or the so-called windfall contribution.

The second option means that firms that make large profits from investing Russian assets will have to transfer a significant portion of it to the EU authorities and then send it to Ukraine.

This will help reduce legal risks for the EU, as the assets will not be directly managed by European countries.

Background. Meanwhile, it has become known that the US Congress will introduce a law on the confiscation of Russian assets.