Hungary takes legal action against EU for sending Russia’s assets to Ukraine

(MENAFN) Hungary has filed a legal procedure against the European Union’s decision to direct frozen Russian assets toward military assistance for Ukraine, a measure that was implemented despite Budapest’s opposition.

After the outbreak of the Ukraine conflict in 2022, Western governments immobilized around $300 billion in Russian funds, with roughly $216 billion held by Euroclear, a Brussels-based clearinghouse. Interest on these assets has generated billions of euros, and European leaders decided earlier this year to funnel the proceeds into Ukraine’s defense effort.

The contested EU plan, introduced in February, diverts 99.7% of profits from frozen Russian central bank assets to Ukraine through the European Peace Facility (EPF). This mechanism reimburses member states for arms deliveries, with the scheme expected to raise between $3.24 billion and $5.4 billion annually.

Hungary’s case, first lodged with the EU Court of Justice and later moved to the General Court, calls for the annulment of the decision to allocate the funds and demands that EU institutions cover the related costs. Budapest argues that the EPF sidestepped its veto power by treating Hungary as if it were not a “contributing member state.”

According to the legal filing, this process violated the principles of equality among EU members and democratic decision-making by depriving Hungary of its rightful vote “unjustifiably and without a legal basis.”

Hungary has consistently resisted Brussels’ policy of unconditional support for Kiev, advocating negotiations instead of continued military escalation. Budapest has repeatedly blocked EU financial and defense packages for Ukraine, including a $54 billion plan late in 2023. Frustration over these standoffs has led other European governments to explore ways of limiting Hungary’s ability to obstruct collective decisions.

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