Four EU states revive push to use €210bn of frozen Russian assets for Ukraine

Four European Union governments are pushing Brussels to reopen one of the most legally and financially consequential debates created by Russia’s invasion of Ukraine: whether approximately €210 billion of immobilised Russian central-bank assets can be used more directly to finance Kyiv rather than remaining frozen while only the income generated by them is deployed.

The foreign ministers of the Netherlands, Poland, Spain and Sweden wrote to EU foreign policy chief Kaja Kallas and Irish Foreign Minister Helen McEntee calling for technical experts to examine new options before EU ministers meet in Ireland on September 1 and 2. They argue that the €90 billion EU loan already agreed for Ukraine for 2026 and 2027 will not provide sufficient short- and long-term support.

The largest obstacle remains Belgium, because around €185 billion of the Russian reserves are held through Brussels-based securities depository Euroclear. Belgium previously rejected an EU proposal for a loan of up to €165 billion backed by the frozen Russian assets, warning that it could be left carrying disproportionate legal and financial liability if Moscow pursued damages claims.

Why has the €210 billion Russian-assets debate returned after the EU dropped it last year?

Ukraine’s financing requirements continue increasing as the war extends deeper into its fifth year, while European governments simultaneously need to spend more on their own defence, energy security and domestic priorities. That makes the source of each additional euro provided to Kyiv increasingly politically important.

The EU resolved the previous disagreement by creating a €90 billion budget-backed loan for 2026 and 2027 rather than using the frozen Russian principal directly. The four foreign ministers now argue that this financing will not be enough, creating renewed pressure to revisit the larger pool of Russian reserves.

Their economic argument is straightforward. If Russian state assets remain immobilised until Moscow eventually pays reparations, using some of their financial value to sustain Ukraine now could reduce the amount European taxpayers need to provide while the fighting is still occurring.

The legal argument is considerably harder because freezing an asset and confiscating or economically deploying its principal are different actions under international and domestic law. That distinction has prevented the debate from becoming a simple political decision about whether Russia should pay.

How is using the Russian principal different from the EU’s existing asset policy?

The European Union already uses extraordinary revenues generated by immobilised Russian assets to support Ukraine. Those earnings accumulate because securities and cash that Russia cannot access continue producing interest and other financial returns while held inside European institutions.

Taking the underlying principal would cross a substantially more consequential legal threshold. Central-bank reserves traditionally enjoy strong sovereign protections because governments need confidence that assets held abroad will not simply be confiscated whenever political relationships deteriorate.

Supporters of a more aggressive approach argue that Russia’s invasion and potential reparations obligations create exceptional circumstances. Critics worry that establishing a precedent for repurposing central-bank reserves could weaken confidence in European financial jurisdictions and encourage other governments to shift reserves elsewhere.

The four countries are therefore asking for technical alternatives rather than demanding that €210 billion simply be transferred immediately. A structure involving guarantees, loans or risk-sharing could potentially extract greater value from the assets without relying on outright confiscation.

Why is Belgium capable of stopping a plan supported by much larger EU economies?

Belgium’s leverage comes from Euroclear, where approximately €185 billion of the immobilised Russian central-bank assets are held. Any legal retaliation or successful damages claim involving that money could therefore fall heavily on a Belgian-based financial institution and potentially create obligations for the Belgian state.

When the Commission previously proposed a €165 billion loan secured against the Russian assets, Belgium argued that other EU members had not provided adequate guarantees that they would share litigation or repayment risks. The proposal was ultimately dropped, and Reuters reported on August 27 that Belgian officials have not changed that position.

This is an example of how financial geography can reshape European politics. Countries demanding aggressive use of frozen assets may face limited direct exposure if most of the funds are legally situated inside another member state.

A workable plan therefore needs to socialise the risk as effectively as it socialises the benefit. If all EU members gain from reducing the amount of taxpayer-funded Ukraine support, Belgium wants corresponding assurance that it will not be left alone if Russia wins a legal claim.

How could Russia respond if the EU uses more of its frozen reserves?

Moscow has repeatedly described possible confiscation of its assets as theft and has pursued retaliatory legal action involving Western-owned assets and financial institutions. Euroclear is already engaged in significant litigation connected with Russian claims, demonstrating that the risk Belgium describes is not theoretical.

Russia could respond through courts under its own jurisdiction, seizures of remaining Western assets or measures against European companies still exposed to the Russian economy. Whether Russian judgments could ultimately be enforced against EU governments or institutions in other jurisdictions is a separate legal question.

There is also a wider reserve-currency consideration. Governments including China, Gulf states and emerging economies may assess whether the treatment of Russian reserves changes the risk of holding assets in euros or other Western currencies.

European policymakers therefore need to distinguish between making Russia bear costs for its invasion and unintentionally undermining financial institutions that provide Europe with substantial strategic advantages. That is why a legally durable structure matters more than producing the largest possible headline number.

Could the September EU meeting finally produce an agreement?

A breakthrough is possible only if the renewed proposals solve Belgium’s liability problem rather than merely restating the political case for helping Ukraine. The four foreign ministers specifically want Commission experts to design fresh options in consultation with member states, suggesting they recognise that the earlier architecture cannot simply be revived unchanged.

Negotiations over the EU’s 2028-2034 budget could add momentum because governments must decide how future Ukraine financing fits alongside other European spending. Every euro obtained through a legally defensible Russian-assets mechanism reduces the amount that has to come directly from national or EU budgets.

The political argument has also hardened as prospects for a near-term end to the war remain uncertain. Polish Foreign Minister Radosław Sikorski has argued that if Russia will not regain its reserves until it pays reparations, using the money to help Ukraine defend itself now may be more valuable than waiting to finance reconstruction after further destruction.

The September discussion therefore begins with the same fundamental question that defeated the previous proposal, but under greater financial pressure. Europe has €210 billion of Russian assets it can freeze relatively easily; converting that leverage into spendable support without creating an unacceptable legal precedent remains the much harder task.