Bloomberg learned how Russia is preparing to respond to the confiscation of its assets

The central bank is “now close to an agreement” with international law firms to represent the country’s interests in the event of litigation, the agency reported

RUSSIA is preparing for legal procedures to thwart attempts by the United States or the EU to confiscate part of the frozen assets of its Central Bank in favor of Ukraine, BLOOMBERG reports , citing sources.

According to the interlocutors, authorities studying the possibility of confiscating Russian assets have concluded that this is unlikely. Despite this, the Russian Central Bank is “now close to an agreement” with international law firms to represent the country’s interests in the event of litigation, the agency reports.

Sources also said that the authorities are collecting expert opinions analyzing relevant legislation abroad and precedents in other countries.

Officials expect that the COURT proceedings will prevent any transfer of funds to Ukraine, even if Russia is unable to gain control of the assets, the interlocutors noted. In their opinion, the West has little chance in court and there are no legal grounds for seizing assets.

Bloomberg mentions a December report by Roscongress, in which the authors analyze examples of asset confiscation in other countries and conclude that “the real risks of confiscation of the Central Bank of the Russian Federation reserves remain low.” Bank of Russia assets are frozen “based on the domestic legislation of several dozen countries that have imposed appropriate sanctions,” and any decision to use them “will be negatively perceived by governments whose reserves are located in countries that supported the sanctions,” as a result, national governments risk being drawn into long-term international litigation with an unclear outcome, the authors explain.

According to BGP Litigation partner Sergei Glandin, who specializes in compliance and sanctions law, Russia’s prospects in court depend on several factors, for example, the presence of a bilateral investment protection agreement. The country can appeal to the International Court of Justice in The Hague, the US District Court for the Southern District of New York and the European Court of Justice in Luxembourg.

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Presidential press secretary Dmitry Peskov said last November that confiscation of assets would entail “very serious judicial and legal costs for those who make such decisions and who take advantage of such decisions.” “Of course, we will also work on response measures. They can hardly be mirrored, but they will be the ones that best suit our interests,” he emphasized.

RBC sent a request to the Central Bank.

In December, the Financial Times wrote that the United States was pushing the G7 to develop tools for the seizure of frozen Russian assets - from outright confiscation and spending of Russian Central Bank assets to using proceeds from frozen assets or using them as collateral for loans. According to the publication, the United States, along with CANADA, Britain and Japan, are going to prepare options for a potential meeting of leaders on February 24 - the two-year anniversary of the start of hostilities in Ukraine . The remaining G7 members:  Germany , France , Italy  - proposed to carefully study the legality of confiscation of Russian assets before a decision is made. The FT also reported that in order to legalize Russian assets, Washington proposed recognizing European countries as “conflict-affected” with the subsequent transfer of funds to Ukraine in tranches through the World Bank or the European Bank for Reconstruction and Development (EBRD) .

In January, Bloomberg reported that the US National Security Council at the White House "in principle" supported a bill that would allow the seizure of Russian assets for subsequent transfer to Kiev. The United States, supporting the decision to confiscate assets, wants to “encourage mainly Europeans to illegal actions,” since the main Russian funds are located there, Peskov said.