After a summer marked by tensions and anticipation over possible peace talks and Europe’s long-term security, it has become clear that the EU must mobilize its strength and exert even greater pressure on Russia. A new geopolitical role is emerging — one that encompasses not only continued support for Ukraine but also the shaping of Europe’s future security architecture. Against this backdrop, the long-standing debate on the use of frozen Russian assets has gained renewed momentum, fueled by the strongest political statements yet from EU leaders.
On 28 August, the Commission’s President Ursula von der Leyen made her remarks: “We are advancing the work on the Russian frozen assets to contribute to Ukraine’s defence and reconstruction” as a response to the devastating Russian attacks on Ukraine. A day later, on 30 August, the EU’s High Representative for Foreign Affairs, Kaja Kallas, stated that “frozen assets will not be returned to Russia unless Moscow pays reparations to Ukraine”, stressing that the bloc must be ready with a plan and strategy towards these funds. Taken together, these statements mark the signal that the EU is prepared to move beyond hesitation.
The EU has already implemented its intent in action – taking real steps to protect its own investors by compensating them using the Russian private assets as described in detail in this brief. The same determination must now be applied to introduce more decisive measures for supporting Ukraine’s survival and Europe’s long-term security with the Russian assets too.
While the political signals are clear, the debate itself is far from over. The discussion over the use of immobilized Russian assets (primarily foreign currency reserves of the Central Bank of Russia – hereinafter, CBR assets) to help Ukraine’s self-defence and recovery has been lasting since the beginning of the full-scale invasion. Therefore, the key decision is anticipated from the EU, with the stance of Euroclear and the Belgian government largely defining the EU decision-making.
Since 2022, the EU has made tangible progress regarding the use of the windfall profits stemming from the management of the immobilized assets. Yet the stance regarding the use of CBR assets in principle is still negative, even though the Russian Federation is obliged to compensate for the damages inflicted by its war of aggression as officially established by the UN General Assembly in November 2022 by its resolution ES-11/54 of November 14, 2022. Currently, even proposals to transfer the immobilized assets to an alternative structure — such as the establishment of the EU-Ukraine Trust Fund to maximize returns — are now facing skepticism and opposition from decision-makers and Euroclear.
Among the concerns cited often are: “a loss of trust from third countries which could decide to withdraw their funds from Belgium or the EU,” “a threat to the euro stability,” “a breach of international law,” “successful litigation by Russia or the CBR in response”, “the retaliation of against the EU companies in response.”
However, simultaneously, the Council of the European Union (hereinafter, the Council) has made two decisions, setting an extraordinary framework to use the Russian private assets to compensate the EU CSD investors who lost their assets due to the hostile actions of Russia.
In December 2024, amendments to the EU CFSP decisions and related regulations allowed the use of cash balances attributable to the Russian National Securities Depository and other sanctioned Russian entities to compensate European CSD investors for losses caused by Russia’s hostile measures. In July 2025, the Council prohibited the recognition and enforcement of arbitral awards and court rulings and decisions by the EU courts related to investor–state disputes over the application of EU measures.
Analysis of both decisions shows that while being within the EU’s broad CFSP mandate, they carry more potential risks pertaining to international law, financial aspects and the reputation of European financial institutions, being based on much weaker legal grounds compared to the ones that already exist for the use of the CBR assets for Ukraine. Nevertheless, these steps demonstrate that the EU is prepared to diverge from its generally stated legal principles and standards, thereby implicitly acknowledging its readiness to accept the potential consequences.
While it is encouraging that the EU is prepared to act with creativity and decisiveness, such measures should not be limited to protecting European investors who made their business choice to continue doing business in Russia. At present, far more than financial losses is at stake — it is Ukraine’s survival as a sovereign state and the risk of further Russian aggression against EU member states.
There is a strong legal case for seizure of the CBR assets as an international countermeasure based on the international customary law rules of state responsibility. It must be viewed not as a legal anomaly, but as a necessary adaptation to the realities of modern warfare and accountability. International law, customary rules, and practices are not immutable; they must evolve and adapt in response to unprecedented acts of aggression.
In this study, we are analysing the decisions of the EU Council and comparing the risks of compensation to Euroclear’s investors at the expense of Russian private assets with the risks of the use of the CBR assets for Ukraine, making the case that it is exclusively a lack of political will that remains a final roadblock for the latter while the legal, financial and retaliation arguments are secondary.
READ THE FULL BRIEF VIA THE LINK
