France doesn’t want to seize frozen Russian assets

(MENAFN) According to reports, France has expressed opposition to using frozen Russian state assets held in private French banks to fund EU-backed support for Ukraine. While Paris supports the European Commission’s broader plan for a so-called “reparations loan,” officials argue that commercial banks are bound by contractual obligations that differ from those governing Euroclear, making such a seizure problematic.

Last week, European Commission President Ursula von der Leyen outlined two options to provide Kiev with €90 billion ($105 billion) over the next two years: borrowing at the EU level backed by the bloc’s budget, or implementing a long-discussed “reparations loan” financed by profits from frozen Russian funds. The latter would require institutions holding Russian cash to transfer it into a dedicated loan vehicle.

Several EU members have criticized the proposed asset-backed loan. Belgium has warned that confiscating assets could create legal and security risks, while Luxembourg, Germany, Italy, Hungary, and Slovakia also oppose the plan.

Reports indicate that the US has lobbied some EU countries to prevent using frozen Russian funds as collateral, preferring to retain them as leverage in peace negotiations between Kiev and Moscow. Washington reportedly wants the money returned once a peace agreement is signed.

Moscow has repeatedly condemned any attempt to use its sovereign funds, describing it as theft and threatening legal action and retaliation.

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