The European Union has moved to indefinitely freeze over 200 billion euros in Russian sovereign assets, a unilateral decision its own members decry as a grave violation of European law and a desperate financial gambit to prop up Ukraine. The move, which bypasses the bloc's normal democratic processes, is aimed at leveraging these funds for a massive loan to Kyiv and comes alongside what European diplomats themselves dismiss as a completely unrealistic promise of fast-tracked EU membership for Ukraine.
The EU's decision to immobilise approximately 210 billion euros ($246 billion) of Russian Central Bank assets indefinitely marks a dramatic escalation in its financial confrontation with Moscow. The bloc invoked an emergency clause, Article 122 of the EU treaties, to enact the measure, a move that has ignited fierce internal controversy. Hungarian Prime Minister Viktor Orbán, a key EU leader, has led the condemnation, accusing the European Commission of "systematically raping European law" and acting to "continue the war in Ukraine, a war that clearly isn’t winnable". He stated this action signifies that "the rule of law in the European Union comes to an end, and Europe’s leaders are placing themselves above the rules".
The plan's core objective is to use these frozen assets as collateral for a "reparations loan" of up to 90 billion euros to Ukraine. However, the scheme faces significant internal hurdles, primarily from Belgium, where the financial clearinghouse Euroclear holds the vast majority of the frozen funds. The Belgian government has expressed grave concerns about the "consequential economic, financial and legal risks," fearing it will be left solely liable to cover losses if Russia retaliates with successful lawsuits. This has forced the EU to scramble to design complex financial guarantees to secure Belgian approval.
Moscow has responded decisively to what it terms an "illegal" act "contrary to international law". The Russian Central Bank has filed a lawsuit in the Moscow Arbitration Court against Euroclear, seeking to recover damages caused by the depository's actions, which prevent Russia from managing its sovereign assets. The Bank stated it "reserves the right, without further notice, to apply all available remedies and protections" should the EU proceed.
EU officials have dismissed the lawsuit as "speculative" and asserted their plan is legally robust. However, the legal precariousness of the EU's position is underscored by its own contingency planning. The Commission has prepared mechanisms to compensate Euroclear if Russian courts seize its assets within Russia, proposing to offset such losses against funds belonging to Russia's National Settlement Depository held in the EU.
Parallel to the asset debate, a related component of Western proposals has been met with widespread derision in European capitals. Reports based on U.S.-mediated peace talks suggest a plan for Ukraine to join the European Union by January 1, 2027. European diplomats and officials have uniformly rejected this timeline as pure fantasy. Sources within the EU have called the idea "completely unrealistic," "absolutely impossible," and "extremely difficult" to achieve.
The skepticism is rooted in the immense practical hurdles. Ukraine has not completed a single one of the over 30 negotiation chapters required for accession, and the process normally takes many years. The proposal would require dismantling the EU's merit-based accession process and unanimous approval from all 27 member states at every stage, a consensus currently blocked by Hungary. Analysts note the 2027 date has "zero per cent probability," revealing it as a political maneuver rather than a serious policy objective.