New EU proposal would move frozen Russian assets from Belgium to an EU-controlled custodian
A new idea circulating in Europe would shift frozen Russian sovereign assets out of Belgium's Euroclear depository and into a new EU-controlled custodian, so the funds could support Ukraine while moving legal liability from Belgium to the EU level. Ukraine supports the concept and has sent a concrete proposal to Brussels, but the EU still treats it as a theoretical possibility, with no draft legislation and no worked-out legal or financial mechanism.
Key points
- The proposal would transfer frozen Russian assets from Belgium's Euroclear to a new EU-controlled custodian.
- Ukraine supports the idea; the Foreign Ministry has transmitted its vision to Brussels, and the Finance Ministry has sent a concrete proposal for a European-level mechanism to receive the funds.
- Spokesperson Georgiy Tykhyi said decisions on using the funds for Ukraine's defense, resilience and reconstruction would be made collectively by all EU governments.
- If a new EU structure becomes custodian, legal liability would shift from Belgium to the EU level, addressing Belgium's objections to a reparations loan.
- The EU treats the idea as a theoretical possibility; there is no draft legislative proposal from the European Commission and no agreed legal or financial mechanism for the transfer.
- PACE is separately exploring a route to channel frozen Russian funds to Ukraine based on ECHR decisions.
Why it matters
If the proposal is taken forward, it could unlock frozen Russian sovereign assets for Ukraine's defense and reconstruction — something Belgium has been blocking by citing legal risks tied to its Euroclear-held holdings. Moving custody to the EU level would shift liability from a single member state to the EU collectively, potentially removing a central political obstacle to using the assets for Ukraine.
What happened
A new proposal is circulating in European capitals that would move frozen Russian sovereign assets from Belgium's Euroclear depository to a new custodian under EU control. Ukraine backs the idea: the Ministry of Foreign Affairs has transmitted its vision to Brussels, and the Ministry of Finance has submitted a specific proposal for a European-level mechanism to receive the funds. Ukrainian Foreign Ministry spokesperson Georgiy Tykhyi said decisions on how the money is spent on Ukraine's defense, resilience and reconstruction would be taken collectively by all EU governments. The logic is that if a new EU structure or banking institution becomes custodian, legal liability would shift from Belgium to the EU as a whole, removing the legal-risk argument Belgium has used against a reparations loan. The European Commission has yet to put forward a draft legislative proposal, and the legal and financial mechanics of any transfer have not been worked out; the EU currently treats the idea as a theoretical possibility rather than a ready plan. In parallel, PACE is exploring a separate route to channel frozen Russian funds to Ukraine based on ECHR decisions.
How Ukrainian sources describe it
Ukrainian outlets frame the proposal positively, stressing that Kyiv is not a passive recipient but is actively shaping it: both the Foreign Ministry and the Finance Ministry have put concrete ideas on the table in Brussels. They highlight Tykhyi's emphasis on collective EU decision-making and distributed responsibility to present the scheme as fair and broadly acceptable across member states.
Background
Belgium has cited legal-risk concerns linked to the Russian assets held at Euroclear on its territory to argue against a reparations loan for Ukraine. PACE is pursuing a separate track to give Ukraine frozen Russian funds based on ECHR decisions. The European Commission previously proposed a reparations loan tied to frozen Russian assets, which EU leaders rejected at a December 2025 Brussels summit; instead they agreed the EU would borrow €90 billion on financial markets under an EU budget guarantee to support Ukraine in 2026-2027. Sweden, the Netherlands, Spain and Poland have jointly called for resuming work on the frozen Russian assets, and EU High Representative Kaja Kallas confirmed after an early September informal meeting of EU foreign ministers in Ireland that the discussion had begun and would continue. Ukrainian President Volodymyr Zelensky publicly stated on August 24, 2026 that there was a significant shortfall of funds for the war, which formally set the current processes in motion.