European Council approves unprecedented legal measures to redirect extraordinary revenues from immobilised Russian assets to support Ukraine
11 Jun 2024
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On 21 May 2024, the European Council issued a press release stating that it has approved certain legal measures (in the form of decisions) to utilise net profits from unexpected revenues of EU Central Securities Depositories (CSDs) holding Russian sovereign assets. It is intended that such revenues will be used for further military support to Ukraine, as well as its defence industry capacities and reconstruction.
Key points:
- Source of funds: EU CSDs holding over €1 million in Russian sovereign assets and reservices, effective from 15 February 2024, will have to make contributions.
- Allocation: The use of funds will be split 90 per cent for military support via the European Peace Facility and 10 per cent for Ukraine’s defence and reconstruction through EU programmes, with the first review scheduled before 1 January 2025.
- Bi-annual payments: CSDs will contribute bi-annually.
- Retained share: CSDs can keep around 10 per cent to meet statutory capital and risk management requirements due to the war's impact.
This strategy channels financial gains from immobilised Russian assets directly into supporting Ukraine's self-defence and rebuilding efforts.
The new EU legal acts form part of a wider dialogue between the EU and its Western partners, principally the USA through the G7, to work to use profits from frozen Russian assets to help Ukraine.
The decisions will enter into force after their publication in the Official Journal.
The European Council’s and European Commission’s press releases can be found here and here.
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