As of June 2023, the total amount of direct documented damage to residential and commercial property and other infrastructure amounted to more than $150.5 billion. According to World Bank estimates, the overall damage caused by the war has already exceeded $411 billion and is constantly growing. Even with the extensive support from partners (from 24 January 2022 to 31 May 2023, assistance worth about €165 billion was provided), no country is able to cover these losses. 

Unprecedented sanctions were imposed on Russia in response to the invasion. One of the most important of these sanctions is freezing of Russian private and public assets around the world. According to various estimates, assets frozen worldwide total between $300 billion and $500 billion. This amount includes public assets of the Central Bank of the Russian Federation as well as private assets of those who contribute to the aggression (Russian oligarchs, politicians, propagandists, etc.).

The exact amount of Russian assets frozen is not known, but it is known that the largest amount has been frozen in the EU. 

Russian assets worth €196.6 billion have been frozen on the accounts of the international depository Euroclear, headquartered in Brussels, of which 180 billion are assets of the Russian central bank and almost 20 billion are private assets of Kremlin associates.

Among the leaders in terms of the amount of frozen private assets there are also the United Kingdom – $20.5 billion, Switzerland – $8 billion, Germany – $5.57 billion, and Luxembourg – $5.54 billion. In total, more than $100 billion worth of private assets have been frozen worldwide.

Some states have already committed themselves at the political level to maintaining the freeze until Russia compensates for the damage caused. However, from a practical point of view, this goal still seems unattainable, as after a year and a half of war, only about $1 billion of Russian assets have actually been seized, which is less than 0.3% of the total amount of damage. And 99% of confiscated assets were confiscated by Ukraine itself.

Thus, at present, $300 to $500 billion of the aggressor’s frozen assets can be used to support Ukraine’s defence and compensate for the damage caused.

Currently, we see several ways that can bring us closer to utilising these assets to compensate for the damage caused by the aggression and help Ukraine.

To compensate for the damage caused by Russian invasion, the following steps should be taken:

I. Keeping frozen assets in a special escrow account until they are transferred to the Compensation Fund.

II. Introducing domestic legislation by partner states that allows for the confiscation and transfer of Russian assets to Ukraine.

III. Channelling the proceeds from Russian assets as well as taxes levied at special rates to compensation and reconstruction.

IV.  Launching a Compensation Mechanism, with the possibility of replenishing the Fund with Russian assets confiscated in accordance with a multilateral international agreement. 

V. Criminalising sanctions evasion and providing for financial penalties and civil confiscation of criminal assets. 

Implementation of the above steps and providing for the legal possibility of transferring the proceeds to Ukraine will demonstrate the inevitability of financial (at the very least) responsibility and clearly indicate to other potential aggressors in the world the possible consequences of gross violations of international law.

Read more in the full text of the brief attached