Moscow’s latest legal move targets the EU regulation linking Ukraine’s loan repayment to future Russian reparations, deepening legal pressure around frozen sovereign assets held largely through Euroclear in Belgium.
The Russian central bank has filed a second claim before the General Court of the European Union, challenging an EU regulation that allows frozen Russian sovereign assets to be used in connection with the repayment of an EU loan to Ukraine. The case adds a further legal front to one of the most sensitive financial disputes arising from Russia’s war against Ukraine.
According to the Russian central bank, the EU framework treats Russia’s sovereign assets as an instrument of financial support for a third country and changes what it describes as the legal and economic regime of those assets. The claim concerns a regulation dated 24 February 2026, under which Ukraine’s loan would be repaid only after Kyiv receives reparations from Russia, while the EU reserves the right to use immobilised Russian assets to cover Ukraine’s debt.
The dispute goes beyond the technical handling of sanctions. It cuts into the central legal question that has divided EU governments for months: how far the bloc can go in mobilising Russian state assets without crossing the line from immobilisation into confiscation, or creating unacceptable legal and financial exposure for institutions inside the Union.
The Russian central bank estimates that about $300 billion of Russian sovereign funds have been frozen by Western countries. Most of those assets are held in Europe, largely through the Brussels-based securities depository Euroclear. That makes Belgium central to the dispute, both because of the scale of assets held through Euroclear and because any future legal or financial retaliation by Moscow would be likely to affect Belgian-based infrastructure first.
This is not the first challenge filed by the Russian central bank before the EU’s courts. In March, it brought a separate case against the EU’s December 2025 decision to immobilise Russian state assets indefinitely. That measure was designed to prevent the assets from being released if the bloc’s normal sanctions renewal process were blocked by one or more member states. The Russian central bank argued that the measure breached property rights, effective judicial protection and the principle of sovereign immunity, according to Belgian News Agency reporting.
The latest claim therefore appears to broaden the legal challenge from the indefinite freeze itself to the EU’s subsequent effort to connect the assets to Ukraine’s financing. In practice, this places two connected questions before the EU judiciary: whether the Union can keep Russian central bank assets immobilised for an open-ended period, and whether it can reserve those assets as part of the architecture for Ukraine’s repayment obligations.
The legal pressure has also increased outside the EU. On 15 May, a Moscow court upheld a Russian central bank claim to recover damages from Euroclear linked to the freezing of assets worth 18.17 trillion roubles, or about $254 billion. Euroclear said it strongly contested the decision, would appeal, and did not recognise the Russian court’s jurisdiction. It also said the assets held at Euroclear Bank remain immobilised in line with international sanctions.
Euroclear has described the Russian proceedings as part of a wider series of claims brought against it in Russia. In a May update on Russian sanctioned assets, the company said the Russian judgment had not affected its operations or financial position, and that such claims are not recognised under EU law.
For Brussels, the case comes at a difficult point. The EU has sought to balance three objectives: maintaining sanctions pressure on Russia, financing Ukraine’s budgetary and defence needs, and avoiding legal uncertainty that could unsettle Europe’s financial infrastructure. The compromise reached earlier this year was to provide Ukraine with a loan while preserving the possibility of using Russian assets if reparations are not paid. A European Parliament briefing on EU support for Ukraine in 2026-2027 described the mechanism as part of a wider package implementing a €90 billion loan for Kyiv.
The case also has political significance. Several member states have supported stronger use of Russian assets to assist Ukraine, while Belgium has repeatedly sought assurances over legal risk and burden-sharing. The new litigation reinforces the Belgian concern that Euroclear and the Belgian state could face disproportionate exposure if the EU moves too aggressively.
For Ukraine, the issue remains practical as well as legal. Kyiv needs predictable long-term financing for defence, reconstruction and state functions. Frozen Russian assets are among the few potential funding sources large enough to alter the scale of external support. However, the EU has so far moved cautiously, preferring mechanisms based on immobilisation and exceptional revenues rather than direct seizure of principal assets.
The General Court case is unlikely to produce an immediate change in policy. EU litigation can take time, and the assets are expected to remain frozen while proceedings continue. However, the Russian central bank’s second claim shows that Moscow is pursuing legal avenues in both EU and Russian courts to contest the bloc’s approach. The case could therefore become relevant not only to Ukraine’s future financing, but also to the EU’s sanctions framework and to wider questions over the treatment of sovereign assets in international financial disputes.
