Scholz considered it legal to purchase weapons for the Ukrainian Armed Forces using income from Russian assets

Scholz pointed out that the EU's use of proceeds from Russia's frozen assets for military assistance to Ukraine is a legal step, and a legal framework has already been created for this. RUSSIA warned of symmetrical response to asset divestment

Using proceeds from Russian assets frozen in Europe to purchase weapons for Ukraine is a legal step, German Chancellor Olaf Scholz said at a press conference following the EU summit.

“For starters, I think using the profits [from Russian assets] and channeling them into military aid is huge progress. I want to emphasize that from a legal point of view, these are completely safe actions. We very carefully checked with international and other types of law that need to be observed here, and said that these <...> incomes do not belong to anyone, and therefore the EU can take them and use them,” said the politician ( quoted by TASS ).

He emphasized that a special legal framework has already been created in the EU as part of the seizure of Russian assets. “Now we need to create a basis for use, this is what the European Commission is working on , and we have now given instructions where they should be directed - in the long term, for the most part, on the needs for ammunition and weapons [for Ukraine],” Scholz added.

After the start of the military operation in Ukraine, the EU and G7 countries froze about $282 billion (€260 billion) of assets of the Russian Central Bank in the form of both cash and securities, the US Treasury reported . Over two thirds of them were in the European Union. Russian Finance Minister Anton Siluanov in 2022 estimated frozen assets at approximately $300 billion.

The majority of frozen Russian assets are located in the Belgian Euroclear (which includes the depository of the same name and Euroclear Bank). At the end of 2023, the financial group received income from them in the amount of €4.4 billion ($4.7 billion), which is equivalent to about 80% of all its interest income for this period. Euroclear chief executive Liv Mostry called using these profits less risky than confiscating the assets themselves.

In February, the HEAD of the EC, Ursula von der Leyen, proposed using the proceeds from frozen Russian assets to purchase weapons for Ukraine or to produce them. She noted that the proceeds do not belong to Russian assets.

The idea was supported by Germany , Poland and France . Three states have privately expressed doubts about this initiative - Hungary, Malta and Luxembourg, Politico wrote. In their opinion, this decision will “complicate the negotiations,” since a general agreement was previously reached on the transfer of money for the restoration of Ukraine. As the FT found out, they decided to redirect funds instead of restoration to ammunition due to the stalled approval of new aid to Ukraine in the United States.

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The draft agreement developed by the EU in March stipulates that part of the income will be transferred twice a year (until sanctions against Russia are lifted) to the European Peace Fund, from which arms supplies to Ukraine are paid, as well as to the Ukraine Facility Support Fund (approved in the European Union a four-year aid program worth €50 billion). Another part will remain in the central depositories to cover the costs of maintaining assets and in case of possible risks, including retaliatory measures from Russia.

Russian authorities call blocking assets abroad illegal. The Kremlin noted that they would consider their seizure in favor of Ukraine “in fact, outright theft.” “We also have no less frozen. Any actions with our assets will receive a symmetrical response,” warned Finance Minister Anton Siluanov.