The European Union approved extending an EU freeze on Russian assets using emergency powers, a key step toward tapping the funds to help Ukraine.
EU governments gave their blessing on Friday to a European Commission proposal designed to head off any veto of an extension, which has been a sticking point in EU attempts to secure a €90 billion loan for Ukraine using immobilized Russian central bank assets.
All 27 EU countries must renew the asset freeze every six months, leading to concern that members such as Hungary could veto it and give Moscow a sudden claim to its funds. The new measure would extend the six-month cycle and require only a qualified majority of countries to support the renewal. That would essentially ensure that as much as €210 billion in Russian assets remain on EU soil.
EU leaders are seeking to sign off on the loan when they meet in Brussels on Dec. 18.
Under Friday’s deal, the commission would review the situation every 12 months, leaving the funds locked on EU soil until it determines that the exceptional circumstances justifying the move no longer exist, people familiar with the matter said.
Hungary called the move to remove unanimity “an unfortunate precedent, which is a symbolic and substantial shift from the Treaty-based EU legal order to an uncharted territory.”
The asset freeze extension is meant to address a main concern for Belgium, which has held up the Russian assets loan plan.
Belgium, which houses most of the Russian funds at the Euroclear financial institution, has argued it could be on the hook to repay the loan if the money were suddenly unfrozen and has sought guarantees from the EU and member states to mitigate the risk.
EU negotiators split off the extension from the bigger prize of tapping the funds to provide loans to Ukraine, as that debate isn’t settled.
EU envoys will meet over the weekend seeking a breakthrough as Ukraine urgently needs the funds by April.
Russia’s central bank said Friday that it’s suing Euroclear in Moscow and threatened the EU with a global campaign of retaliation if the bloc makes any use of the frozen funds.
This article was generated from an automated news agency feed without modifications to text.
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