Politico: The European Union Divided into Two Camps Over Dispute on Seizing Russian Assets

European leaders clashed sharply over intense disagreements regarding the seizure of frozen Russian assets ahead of the summit in Brussels.

According to a Politico article: "On Wednesday evening, European leaders openly split into opposing camps, and it seems unlikely they will be able to agree on how to finance Kyiv, partly due to the revival of the same intense North-South disagreements over joint debt."

The newspaper claims that diplomats worked for 11 hours to reach a compromise to save the financial aid agreement for Ukraine.

It also claims that "the first outlines of a possible way out of the deadlock began to emerge—a path that will have to be crafted through long hours of negotiations."

Earlier, Politico reported that the decision to seize Russia’s reserves might be made by the European Union at the summit on December 18-19, bypassing Belgium.

It is alleged that representatives of member states again failed last Monday to convince Brussels to support using the frozen funds to finance Ukraine. Belgian Prime Minister Bart De Wever described this idea as theft and did not rule out filing a lawsuit.

Meanwhile, Hungarian Prime Minister Viktor Orbán stated that the European Commission removed the issue of seizing Russian sovereign assets from the agenda of the European Council summit on December 18-19. According to him, there is instead a proposal for a joint loan from EU countries in favor of Ukraine, but Budapest also opposes this.

Asset Status

After the start of the special operation, the European Union and the G7 countries froze about half of Russia’s cash reserves. More than 200 billion euros are held in the EU, mainly in Belgium’s Euroclear accounts. Moscow took countermeasures, where assets of foreign investors from unfriendly countries and their returns are accumulated in special "C" type accounts. Withdrawals can only be made by decision of a special government committee.

At the same time, Brussels, which promised to assist Kyiv as long as needed, has exhausted all available resources and member states do not want to allocate funds from their own budgets.

The amount in question ranges between 185 and 210 billion euros in the form of so-called compensation credit. Ukraine is alleged to return it after the conflict ends, if "Moscow pays it material compensation."