Freezing of RF assets and the issue of reparations
- About 300 billion dollars of the reserves of the Central Bank of Russia are frozen abroad (EU and G7 estimate).
- The majority of these assets are located in the jurisdictions of the European Union.
- The use of these funds and the income from them for the reconstruction of Ukraine is being discussed.
- The basic principle of international law: the aggressor is obliged to compensate for the damage caused.
The reconstruction of Ukraine after Russian aggression will require colossal funds. Hence the logical question: who should pay for this. International law provides a clear answer — the responsibility for compensation lies with the aggressor state. A practical reflection of this principle has been the freezing of about 300 billion dollars of the Russian Central Bank's reserves and the ongoing discussion about how to direct these funds to the needs of Ukraine. Let's analyze what is frozen, what legal approaches exist, and what the difficulties are.
What exactly is frozen
After the start of the full-scale invasion, the G7 countries and the European Union immobilized the foreign currency reserves of the Bank of Russia held abroad. It is estimated that this amounts to around 300 billion dollars. A significant portion of these funds is located in European financial institutions.
- The freeze means that Russia cannot access these funds.
- These are the reserves of the aggressor state, not private assets of citizens.
It is important to distinguish: freezing (immobilization) and confiscation (seizure of property rights) — these are steps with different legal consequences.
Principle: the aggressor must pay
At the heart of the discussion is an established principle: a state that commits an internationally wrongful act is obliged to fully compensate for the damage it has caused. In the context of war, this means that the costs of restoring the destroyed infrastructure, housing, and economy of Ukraine should ultimately fall on the aggressor, not on the affected party or taxpayers of other countries.
This principle is also supported at the UN level: the creation of mechanisms for accounting damage and compensation is being discussed, and frozen reserves are considered a natural source of reimbursement.
How assets can be used
Several approaches are being discussed, differing in terms of legal risk:
- Income from assets. Frozen reserves generate profit (interest, coupons). It is proposed that these revenues be directed towards supporting and rebuilding Ukraine — this approach is considered legally more cautious.
- Using the assets themselves. A more radical option is to utilize the principal amount, for example through special mechanisms. This raises more complex legal issues.
- Provision for future reparations. Frozen funds can serve as collateral for damage compensation mechanisms.
What is the difficulty
Complete confiscation of state reserves is a legally sensitive step. Partner states strive to act in a way that decisions are legally sound, do not undermine trust in the financial system, and do not give the aggressor formal grounds to contest them. Therefore, approaches are developed cautiously and in agreement.
Nevertheless, the direction of movement is clear: frozen assets are increasingly viewed as a resource for recovery, and the very idea that the cost of war should be borne by the one who started it is being established in international practice.
Frequently Asked Questions
How many Russian assets are frozen abroad?
According to estimates from the EU and G7 countries, about 300 billion dollars of the Central Bank of Russia's reserves are immobilized, a significant portion of which is located in European jurisdictions.
Is freezing and confiscation the same thing?
No. Freezing merely immobilizes assets without depriving formal ownership rights. Confiscation means the seizure of property and is legally much more complex.
Where do they suggest directing these funds?
The use of the assets themselves and especially the income from them for the reconstruction of Ukraine and for mechanisms to compensate for the damage caused by the war is being discussed.
Why wasn't this done immediately and completely?
The complete confiscation of state reserves is a legally sensitive step. Partners are developing solutions cautiously to ensure they are robust from a legal standpoint and do not undermine trust in the financial system.
Sources: Statements and decisions of the EU Council on frozen assets (consilium.europa.eu), G7 statements (official G7 platforms), UN materials on compensation for damage to Ukraine (un.org), Articles on state responsibility from the UN International Law Commission (legal.un.org)
The material is informational and analytical in nature and is based on data from official international organizations. The figures are provided with references to sources. Updated: July 6, 2026. Edited by MegaInet.art.
