Business & Economics
EU Unveils Contested Plan to Seize €210 Bln in Russian Reserves for a €140 Bln Ukraine “Reparations Loan”
On 3 December 2025 the European Commission formally tabled legislation to collateralise a €140 billion zero-interest loan to Kyiv by confiscating all €210 billion of frozen Russian sovereign assets, immediately drawing veto threats from Belgium and a legal rebuff from the European Central Bank.
Focusing Facts
- Draft legal text presented 3 Dec 2025 would redirect the €210 billion in Russian central-bank reserves immobilised at Euroclear and other EU institutions to back the loan, repayable only if Russia later pays war reparations.
- On 2–3 Dec 2025 the ECB refused Brussels’ request to act as lender-of-last-resort for Euroclear, citing EU Treaty articles banning monetary financing and warning of systemic-risk spill-overs.
- Belgium, where about €185 billion of the assets are parked, reiterated its 23 Oct 2025 summit veto unless all 27 member states indemnify it against Russian retaliation and litigation costs.
Context
Great-power wars have repeatedly produced attempts to fund reconstruction through enemy assets—from the 1919 Allied seizure of roughly 2 billion gold marks in German property to the U.S. freezing $12 billion in Iranian assets in 1979. Most of those episodes triggered protracted arbitration and only partial payouts; they also encouraged targeted states to diversify away from hostile jurisdictions. The EU’s gambit fits a broader, post-2008 trend of weaponising the plumbing of the dollar-euro financial system (e.g., SWIFT expulsions in 2012 and 2022). If enacted, it would test the sanctity of central-bank reserves—an informal pillar of the Bretton Woods order—potentially accelerating the shift toward alternative clearing networks and reserve currencies over the next century. Conversely, if the plan collapses, it will expose the limits of EU fiscal coordination and the fragility of multilateral sanctions when real balance-sheet risk concentrates in one small member state. Either outcome will echo far beyond Ukraine: sovereigns will henceforth price political confiscation risk into where they hold their rainy-day funds.
Perspectives
Pro-Commission international news outlets
e.g., Firstpost, Devdiscourse — report that Brussels is readying a legal mechanism to tap €140 bn in frozen Russian assets as collateral for a ‘reparations loan’ to keep Ukraine financed, portraying the scheme as an innovative route that still leaves other funding options open. coverage leans on Commission briefings and stresses political momentum while playing down the steep legal and financial objections spelled out in other pieces.
Belgian officials and euro-zone financial guardians
e.g., Anadolu Ajansı quoting Belgium; ECB leaks via Pagenews.gr — warn that the loan idea is the “worst” option, arguing it violates EU law, exposes Belgium and Euroclear to retaliation and liquidity shocks, and must not proceed without airtight guarantees. messaging centres Belgium’s liability and the ECB’s mandate, arguably privileging domestic financial risk management over the urgency of funding Ukraine.
Russian state-backed media
TASS — frames the European Commission’s forthcoming proposal as outright expropriation of €210 bn in Russian assets, highlighting member-state dissent and forecasting a decision at the 18 December summit. language depicts the move as illegitimate ‘seizure’ and spotlights EU infighting to undermine Western unity, reflecting the Kremlin’s strategic narrative.