The European Union faces a critical deadline on 15 March 2025 to renew sanctions against individuals and organisations linked to Russia’s aggression against Ukraine. Without unanimous approval from all 27 member states, these sanctions will expire, allowing over 2,400 sanctioned entities and individuals to regain access to their assets and European markets.
Hungary is the sole holdout, blocking the renewal process and putting billions of euros in frozen Russian assets at risk of being released. Unlike previous negotiations, Budapest has not tabled concrete demands, complicating diplomatic efforts to reach a resolution.
The Sanctions at Stake
EU sanctions against Russia date back to 2014, following the annexation of Crimea. They fall into two broad categories:
- Targeted sanctions on individuals and entities undermining Ukraine’s sovereignty, introduced in March 2014.
- Sectoral sanctions, imposed after the downing of flight MH-17 in July 2014, restricting entire industries such as finance, energy, and defence.
These measures have been repeatedly expanded, especially following Russia’s full-scale invasion of Ukraine in 2022. However, EU law requires their renewal every six months, offering opportunities for individual member states to leverage their support in broader political negotiations.
Hungary’s Position
Hungarian Prime Minister Viktor Orbán has repeatedly used his country’s veto power to extract concessions from Brussels. In January 2025, Hungary sought financial benefits in exchange for extending sectoral sanctions. Now, its opposition to renewing targeted sanctions risks releasing assets belonging to Russian individuals and businesses.
Diplomatic sources indicate that Hungary is not outright demanding the removal of all sanctions but is pushing for modifications, including the delisting of certain individuals.
EU diplomats believe Hungary’s stance is influenced by political developments in the United States, particularly the Trump administration’s approach to Ukraine and Russia.
The Impact of a Lapsed Sanctions Regime
Failure to renew the sanctions could have significant consequences beyond allowing sanctioned individuals to travel freely within the EU. It would also affect the approximately €210 billion in frozen Russian assets held in Europe, primarily in Belgium’s Euroclear financial institution.
While around half of these assets belong to Russia’s central bank, a substantial portion—estimated at €60 billion—is tied to sanctioned Russian oligarchs and businesses. If sanctions are not extended, these individuals could regain control of their assets, undermining efforts to hold Russia accountable and finance Ukraine’s reconstruction.
The EU and G7 nations have already begun using interest generated from these frozen assets to support Ukraine, including military aid. A partial release of these funds would reduce the available financial support for Kyiv and weaken the EU’s economic leverage over Moscow.
Possible Outcomes
While the immediate expiration of sanctions on 16 March would not result in the instant release of frozen assets, it would create legal uncertainty and logistical challenges in maintaining restrictions. The EU has limited time to resolve the impasse.
If Hungary continues to withhold its approval, EU foreign ministers may escalate discussions to a higher political level at the Foreign Affairs Council meeting on 17 March. Some diplomats remain optimistic that Orbán will back down at the last minute, as has occurred in previous negotiations. However, others fear a protracted standoff that could disrupt the EU’s sanctions regime.
The next crucial meetings of EU ambassadors are scheduled for 12 and 14 March, providing further opportunities for negotiations. Should no agreement be reached, the EU may need to explore alternative legal mechanisms to maintain pressure on Russia without Hungary’s support.
Regardless of the immediate outcome, Budapest’s actions have once again highlighted the fragility of the EU’s unanimous decision-making process on foreign policy. The continued ability of a single member state to obstruct critical sanctions raises broader questions about the bloc’s ability to maintain a unified stance against Russian aggression.
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