PACE Calls for Transfer of Frozen Russian Assets to Ukraine Reconstruction Fund

PACE unanimously adopts resolution to transfer frozen Russian assets to fund Ukraine's reconstruction, providing a mechanism for compensation of war damages.

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PACE Calls for Transfer of Frozen Russian Assets to Ukraine Reconstruction Fund

PACE Calls for Transfer of Frozen Russian Assets to Ukraine Reconstruction Fund

The Parliamentary Assembly of the Council of Europe (PACE) has unanimously adopted a resolution calling for the transfer of frozen Russian state assets to a new fund for Ukraine's reconstruction. The resolution, passed on April 16, 2024, urges all countries where Russia has accounts to take the necessary measures to ensure the transfer of these assets to an international compensation fund.

Around $300 billion in Russian assets were frozen by Ukraine's Western partners and allies at the start of Russia's full-scale invasion in 2022, with roughly two-thirds held by the Belgium-based financial services company Euroclear. While some partners, like the U.S., have pushed for directly funneling these funds to Kyiv, European countries have been more hesitant, fearing economic and legal pitfalls.

The PACE resolution proposes the establishment of an international trust fund into which frozen Russian assets from Council of Europe member and non-member states would be deposited. It also calls for the creation of an impartial and effective claims commission to consider applications from Ukraine and other entities affected by the Russian aggression for compensation for damages caused by Russia's war.

The Council of Europe summit in Reykjavik in 2023 agreed in principle on this compensation mechanism, and a register of losses from Russian aggression has already been established, which began accepting applications on April 2, 2024. The EU is also working on a plan to use the profits generated by the frozen assets to fund defense assistance for Ukraine.

Why this matters: The transfer of frozen Russian assets to a fund for Ukraine's reconstruction represents a significant step in holding Russia accountable for the damages caused by its war of aggression. It also provides a mechanism for Ukraine and affected entities to seek compensation for their losses.

At the PACE session, Ukrainian Parliament Speaker Ruslan Stefanchuk addressed the politicians representing the parliaments of 46 European countries. He emphasized that peacekeeping games, lack of weapons, imperfection of sanctions, delays in the confiscation of Russian assets, and lack of accountability and punishment mechanisms are making "non-humans stronger". Stefanchuk called on MEPs to support Ukrainian President Volodymyr Zelensky's formula for a just and lasting peace and invited the leadership of the Council of Europe to the Peace Summit in Switzerland in June 2024.

Key Takeaways

  • PACE unanimously adopted resolution to transfer frozen Russian assets to Ukraine.
  • Around $300 billion in Russian assets were frozen by Ukraine's Western allies.
  • PACE proposes establishing an international trust fund for frozen Russian assets.
  • EU working on plan to use frozen assets profits for Ukraine's defense assistance.
  • Ukraine's Parliament Speaker called for support of Zelensky's peace formula.