US suggests G7 coordinate plan to confiscate Russia’s assets

The US has proposed to the countries of the G7 to analyze possible ways of confiscating US$300 billion of frozen Russian assets. Ukraine’s partners aim to coordinate the action plan before the second anniversary of Russia’s full-scale invasion, according to the Financial Times.

“While no decisions have been taken and the issue remains hotly debated inside European capitals, the acceleration of work on confiscating Moscow’s assets for Ukraine highlights its rising importance for the west,” journalists say.

In talks held earlier this month, G7 finance ministers and their deputies deliberated the adoption of this decision. The US, UK, Japan, and Canada jointly suggested extending preliminary efforts to finalize potential confiscation strategies ahead of a potential G7 leaders’ summit on February 24.

Specialized experts will analyze legal issues regarding the confiscation of frozen Russian assets. They will also focus on methods of implementing such a policy and mitigating risks. The discussions will center on ways to direct support to Ukraine.

Reservations regarding the asset confiscation plans have been voiced by Germany, France, Italy, and the EU, stressing the importance of meticulously assessing the legality of Moscow’s asset seizures. Additionally, maintaining utmost secrecy in this endeavor has been advised, with several European ministers underscoring the need for heightened discretion.

Among the options being considered by working groups are the direct confiscation and expenditure of assets from the Russian Central Bank, obtaining income from frozen assets, or using them as collateral for obtaining loans.

Until now, the US has not publicly supported confiscating Russian assets. However, this year, within the G7 framework, Washington privately circulated a discussion document stating that arresting frozen Moscow assets would be legal as “a countermeasure to induce Russia to end its aggression.”

In Europe, there are concerns about the consequences for financial stability resulting from the decision on confiscation, as well as Russia’s reaction. The EU, the United Kingdom, and France emphasize that these funds will not be easily accessible and insufficient to cover Ukraine’s reconstruction needs. According to Ukraine’s partners, the arrest of assets should not come at the expense of providing financial support to Kyiv in 2024.

Earlier, Editor-at-Large National Post, columnist Kyiv Post, and Non-Resident Senior Fellow at the Atlantic Council, Eurasia Center, author, and publisher Diane Francis, called on the West to confiscate Russian frozen assets as soon as possible.