The EU wants to bypass Hungary's veto for the sake of joint loans for Kyiv.

The EU could once again invoke the European Commission's emergency powers, as it did with the indefinite freeze on Russian assets, to decide on joint borrowing to finance Ukraine, which currently requires unanimous approval from member states. European Central Bank (ECB) President Christine Lagarde has proposed this, ANSA and Euractiv report, citing sources.

Belgium, which opposes another option for financing Kyiv—issuing a "reparation loan" using Russian assets—has also proposed considering such a move, according to four diplomatic sources at Euractiv. Moscow has warned that using Russian assets would result in retaliation. The Central Bank has already filed an 18 trillion ruble lawsuit against Euroclear, the depository where most of Russia's assets are held.

The EU's legal service ruled out the possibility of using emergency powers for joint borrowing during the EU ambassadors' meeting on December 16, two sources said. Another source noted that joint debt obligations could technically be approved without unanimity if they were not backed by EU budgetary funds.

Ukraine's financial needs in 2026–2027 exceed €137 billion, according to European Commission President Ursula von der Leyen. She stated that the EU must decide in the coming days on the financing option for Ukraine—whether it will be through joint debt or frozen Russian assets. Germany opposes the first option , while Belgium and several other countries, including Italy, oppose the second. Hungary rejects both options.

The European Commission's emergency powers, which the EU used to permanently freeze Russian assets, are provided for in Article 122 of the Treaty on the Functioning of the European Union. This mechanism has already been used in response to the eurozone debt crisis and the pandemic.covid-19 , but has never been applied to security policy matters, which require unanimous decisions by EU member states, the Financial Times explained. The publication's sources noted that the use of emergency powers has sparked disagreement among EU lawyers and will almost certainly create legal challenges.

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