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EU Council reveals plan for allocating and utilizing profits from Russian assets in Ukraine

EU Council reveals plan for allocating and utilizing profits from Russian assets in Ukraine Illustrative photo (Getty Images)

The EU Council has adopted a series of legislative acts that guarantee the net profit from Russia's frozen assets will be used to further military support for Ukraine and to strengthen its defense capabilities and reconstruction, according to the institution's press service.

"The CSDs (Central securities depositories - ed.) holding Russian sovereign assets and reserves of more than €1 million will make a financial contribution from their corresponding net profits, accumulating since 15 February 2024," the statement said.

The amounts will be paid by the CSDs to the EU every two years to be used for further military support to Ukraine through the European Peace Facility and to support Ukraine's defense industry and reconstruction needs.

90% of the funds will be transferred to the European Peace Facility, and the remaining 10% will be allocated to EU programs funded from the bloc's budget.

"This allocation will be reviewed yearly, and for the first time before 1 January 2025," the statement said.

The CSDs will be allowed to temporarily withhold a part of the financial contribution of about 10% to comply with the established capital requirements and risk management in connection with the consequences of the war in Ukraine for the assets held by central securities depositories.

Russian assets

The assets of the Central Bank of Russia worth about $330 billion have been frozen in Europe and the United States in response to the full-scale military invasion of Ukraine. The question of using this money remains unresolved.

The confiscation of assets has not yet been considered. Instead, Western countries have suggested using the profits to help Ukraine.

On May 21, the EU Council approved sending proceeds from Russia's frozen assets to Ukraine.