Last December, the EU seemed to have found a way around one of its biggest disagreements over Ukraine. European leaders approved a €90 billion loan for 2026 and 2027, while the much more controversial idea of using frozen Russian assets for a “Reparations Loan” was pushed aside. It looked like the argument had been settled, but in practice the decision mostly postponed the hardest part of it.
Around €200 billion in Russian assets are still sitting at Euroclear, the Brussels-based financial institution that has become the centre of a complicated legal fight. The assets remain frozen, Russia still claims them, and cases connected to the money are now moving through Russian, Belgian and European courts. What started as a debate over how to finance Ukraine has gradually become a question of who can ultimately control the assets and which courts get a say.
The EU’s original plan helps explain why the issue became so difficult. Rather than simply confiscating Russian central bank reserves and giving them to Ukraine, the European Commission proposed using cash balances connected to the immobilised assets to support a Reparations Loan. That distinction mattered because actually taking ownership of another country’s central bank reserves would create much more serious legal questions.
Belgium was especially cautious because most of the assets are held at Euroclear. If Russia eventually succeeded in getting its money back, Belgium feared that it could end up carrying a huge part of the financial and legal risk. So in December, EU leaders chose another route and approved €90 billion in borrowing backed by the EU budget to cover Ukraine’s needs for 2026 and 2027. The Russian assets would stay frozen in the meantime.
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The Reparations Loan itself was not formally abandoned. The European Council called for work on its legal and technical details to continue, meaning the option is still there even though it was no longer needed to cover Ukraine’s immediate financing gap. The December deal therefore solved one problem without answering the bigger question of what eventually happens to the Russian money.
That uncertainty is now playing out in court. In May, Moscow’s Arbitration Court sided with the Russian Central Bank in its case against Euroclear, awarding around 18.2 trillion rubles in damages. Euroclear rejected the ruling and said the Russian court had no jurisdiction over the Belgian institution.
Euroclear appealed, but the appeal was rejected in July. The company says Russian judgments against it are not recognised under EU law and that it will continue defending its interests. Euroclear’s own half-year results confirm both the May judgment and the rejected July appeal.
The difficulty is that the two sides are operating within different legal systems. Russia has a judgment from a Russian court, while Euroclear is a Belgian institution following European sanctions law and does not recognise that court’s authority. Inside the EU, the Russian judgment has no automatic force. Russia could still try to pursue Euroclear assets elsewhere, however, particularly in countries where its court decisions might have a better chance of being recognised. The Russian Central Bank has already indicated that it could look for enforcement outside Europe.
Private Russian investors are also putting pressure on Belgium. Nine notices of dispute have been filed against the Belgian state, with investors relying on older investment treaties signed through the Belgian-Luxembourg Economic Union. Some of the claims use an agreement signed with the Soviet Union in 1989.
These investors are trying to use international arbitration rather than ordinary Belgian courts to challenge the freezing of their assets. The amounts involved have not been made public, and filing a notice of dispute does not mean the investors will win. Still, the nine cases matter because they show that the legal pressure is no longer coming only from the Russian Central Bank.
The situation became more complicated again this month. On September 11, Belgium’s Council of State ruled that the Belgian Treasury did not have the properly defined authority to reject a request from Russia’s BCS Bank to release assets held at Euroclear. The court did not order the assets to be released and did not overturn the EU sanctions. Instead, the issue was with the way authority had been delegated to the Treasury.
The ruling was narrow, but it is still relevant to the wider dispute. Belgium is administering sanctions involving enormous amounts of money, and even procedural problems can create room for more challenges. A few days later, the dispute reached the EU courts as well.
On September 15, the Russian Central Bank filed a case with the EU’s General Court challenging part of a regulation adopted in July. The provision is designed to make it harder for certain Russian court orders to be recognised and enforced outside Russia. Moscow argues that this interferes with its attempt to enforce the judgment against Euroclear. That is now for the General Court to consider.
None of these cases means Russia is close to recovering the €200 billion. The assets remain immobilised under EU sanctions, and at the end of June Euroclear reported €202 billion in sanctioned Russian assets on its balance sheet. But the reason the legal fight keeps growing is that freezing money and taking ownership of it are not the same thing.
The EU can prevent Russia from accessing the assets, but permanently confiscating them would be a much bigger step. It would raise questions about sovereign immunity, property rights and the wider consequences of seizing another state’s central bank reserves. That is partly why Europe has focused on using the extraordinary profits generated by the frozen assets instead of simply taking the underlying money. Euroclear says it had paid around €6.6 billion to the EU through the windfall contribution by the end of the first half of 2026.
For the moment, this approach allows Europe to support Ukraine without settling the ownership question. It becomes much harder if the war ends, sanctions change or reparations are eventually agreed. At that point, someone will have to decide what happens to the principal itself, while Russia is already trying to strengthen its claim through its own courts and the EU is building legal barriers against those judgments.
This is why the December compromise was less final than it first appeared. The EU found another €90 billion for Ukraine and avoided making an immediate decision about the frozen assets, but the underlying dispute continued. It has simply become less visible as it moved away from European Council negotiations and into courts and arbitration cases.
Europe still has roughly €200 billion in Russian assets sitting inside its financial system, and four years after they were first frozen, there is still no clear answer to what eventually happens to them. The financing debate may have quieted down, but the question at the centre of it has not gone away: who ultimately gets the money?
