EU ambassadors agree to freeze russian assets in Europe until ‘end of russian aggression’

Ambassadors from the EU’s 27 member states agreed on Thursday to extend the freeze on Russia’s €200 billion ($232 billion) assets in Europe until Russian aggression ends – potentially enabling some long-awaited progress on a proposed EU “reparations” loan to fund Ukraine’s war effort.

The reparations loan, so-named because Ukraine would only repay it if it received financial reparations from Russia after the war, has been stuck in limbo for months – in large part due to the concerns of Belgium, which holds most of Russia’s European assets in its Euroclear bank, that it would face the bulk of the plan’s financial or legal consequences.

Belgian Prime Minister Bart de Wever has yet to be convinced that the EU could protect the Belgian taxpayer from Russia’s retribution – but, as per AFP, a “large majority” of ambassadors from the EU’s 27 nations agreed on Thursday to a proposal which brings the loan one step closer to becoming a reality.

One major barrier to the plan is that renewing the freeze of Russia’s assets in Europe currently requires unanimous approval from EU member states twice a year. On Thursday, EU ambassadors agreed to vote to keep the assets frozen “until the end of Russian aggression,” as per AFP.

If this agreement is formalized at a meeting of EU finance ministers set to take place on Friday, then Hungary – a close ally of Russia – will lose its power to veto the renewal, and the reparations loan will be on firmer ground than it has been for months.

In a statement, Hungary’s permanent representatives to the EU condemned the news as an “unprecedented decision to extend sanctions on an incorrect legal basis in order to circumvent unanimous decision-making.”

The legal basis of the move is Article 122 of the Treaty on the Functioning of the European Union, which allows the European Council to take exceptional measures when an EU member state is “in difficulties or is seriously threatened with severe difficulties.”