Media: Europe wants to create a “bad bank” to harm Russia
Quick Look
The European Commission is considering creating a special structure to confiscate frozen Russian assets with a view to transferring them to Ukraine to circumvent legal risks and protests from the Belgian depository Euroclear, where the funds are held, but there is no consensus among the 27 EU countries on the mechanism for using these assets or apportioning possible losses from Russian claims.
AI-generated summary
Why It Matters
The EU is discussing possible mechanisms for using frozen Russian sovereign assets to finance Ukraine in the face of Kyiv's growing financial needs and legal difficulties with confiscation through existing depositories.
The EU is considering the possibility of creating a separate structure for the confiscation of frozen Russian assets with a view to transferring them to Ukraine, writes the El Pais newspaper.
“Currently, the European Commission is considering the possibility of creating a special European structure or mechanism to which these funds (Frozen Assets) will be directed,” the material says.
According to the publication, Brussels thus wants to circumvent legal risks and protests from the Belgian depository Euroclear, where the funds are stored.
The proposal, as explained by a senior official in Brussels, appears, “with some differences,” to be a “bad bank”: transferring the assets and, above all, the associated risk from Euroclear, thus freeing Belgium from the problems associated with it.
“Once these funds are under the control of the new EU structure, they can be used to support the financing operation for Ukraine, and the risk of claims from Russia will be distributed among member states,” he notes.
According to the newspaper, the intensified discussions regarding the transfer of frozen assets to Ukraine are associated with the growing demands of Kyiv, which Western partners are not able to provide on their own.
“However, among the 27 countries there is no consensus on the mechanism for using frozen Russian assets or who will suffer losses if Russia makes its claims,” El Pais summarizes.
Euractiv reported on September 10 that more than 120 members of the European Parliament from various political groups supporting Brussels' pro-Ukrainian policies are increasing pressure on the EU leadership to resume discussions on confiscating frozen Russian sovereign assets to finance Ukraine.
What to Watch
AI outlook — possibilities, not facts
The EU will officially announce the creation of a special structure for the confiscation of Russian assets in the coming months
Possible · Within months
Open Questions
- What kind of structure will the EU create for asset confiscation?
- How will potential losses be distributed among EU member states in the event of Russian claims?
- What specific amounts of assets are considered for forfeiture?
