MOSCOW, February 13 The possible confiscation of Russian assets by the European Union will lead to mirror response actions: the EU is aware of such risks, therefore it is forced to take action around these means “complex pirouettes,” commented the head of the analytical department of the BKF bank, Maxim Osadchiy.
Unfriendly countries have been imposing sanctions against Russia since February 2022; as a result, both sovereign assets and funds of private investors have been frozen. The country's foreign exchange reserves were frozen in the amount of about $300 billion. Almost immediately, talk began about the confiscation of these assets by foreign countries for various purposes. In October 2022, EU leaders instructed the European Commission to prepare proposals for using frozen assets to finance the reconstruction of Ukraine.
On January 29, the permanent representatives of the EU member states preliminary agreed on the EC's proposal on the use of income from Russian assets frozen in EU countries — income will be accounted for separately and stored in special accounts. On Monday, the EU Council approved a decision on such revenues with their storage in special accounts, and also issued a statement that these funds may be sent to the EU budget for their further use for the reconstruction of Ukraine “at a later stage.” The mechanism itself has not yet been developed.
“The confiscation by the EU countries of frozen Russian assets in any form — either in whole or in parts — will lead to retaliatory steps by the Russian leadership. If the Europeans did not realize the risks, they would not have performed such complex pirouettes around tasty Russian assets,” the expert believes.
First of all, we can expect the confiscation of European assets under the jurisdiction of the Russian Federation, Osadchiy notes. In addition to frozen assets held in type “C” accounts, foreclosure may also be brought against Russian banks and enterprises owned by legal entities and individuals from EU countries.
«In addition, there is an obvious risk that after the end of the geopolitical conflict, EU countries will have to return confiscated assets to Russia,» the expert concluded.