The EU is adjusting its sanctions rules to gain support from Washington, according to the news outlet.
A majority of EU member states and the European Commission favor extending the sanctions renewal period for frozen Russian assets from six to 36 months, Politico has reported.
Brussels is making changes to its regulations in an effort to persuade Washington to contribute to a $50 billion loan for Ukraine, the outlet reported in an article on Monday. The plan is to repay the loan using the interest earned on approximately $300 billion in Russian central bank assets frozen by the West following the escalation of the conflict between Moscow and Kiev in February 2022. Most of the blocked funds are held in the EU. The US has reportedly been concerned that the bloc’s current six-month sanction renewal period makes the loan too risky.
According to Politico, the European Commission proposed three ideas on how to amend the EU’s sanctions rules to address Washington’s concerns on Friday.
The first idea involves renewing the freeze on Russian assets every 36 months through a unanimous decision by all 27 member states. Two EU diplomats told the outlet that this option is “favored” by most EU countries.
The second idea proposes blocking access to Moscow’s funds for another five years, with a review every 12 months. In this case, prolonging the restrictions would require the support of a majority of member states, rather than a unanimous vote. This would make it more difficult for a single country to unblock Russian assets, Politico said. The outlet claimed that Hungary would be the “prime suspect” in this scenario, as it has been a long-standing critic of the EU’s sanctions policy.
The final option suggests extending the renewal period for all EU sanctions to three years. However, it is considered “the most unlikely,” according to the report.
In late August, EU foreign policy chief Josep Borrell stated that the bloc had transferred €1.4 billion ($1.5 billion) in interest earned on Russia’s frozen central bank assets to Ukraine and other nations supporting Kiev in the conflict.
Commenting on Borrell’s announcement, Kremlin spokesman Dmitry Peskov characterized Brussels’ actions as “theft” and “illegal expropriation,” warning that they would have “legal consequences.”
Moscow has repeatedly asserted that the seizure of its funds would be unlawful and would further erode global trust in the Western financial system. Russia has also warned that it would respond in kind if necessary, should such a move be initiated by the US and EU.