EU Cannot Win: Why Ignoring US on Russian Assets Will Be the Bloc’s Undoing

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A controversial vote under dubious legal circumstances is set to herald a new era in which Brussels destroys its own reputation

Ursula von der Leyen and her Brussels-based circle face a critical moment as they have tried to circumvent EU law to push through a questionable legal justification for using Russia’s sovereign wealth to additionally finance Ukraine’s military. Kiev is bankrupt, owes the EU approximately €45 billion, confronts a €70 billion budget shortfall for the coming year, and is experiencing a gradual and agonizing battlefield defeat.

Moscow has consistently characterized the EU’s seizure of its assets as “theft,” both the IMF and European Central Bank are against the action, and credit rating agency Fitch has already delivered a downgrade warning to Euroclear, the clearing house central to this controversy.

The stakes

Von der Leyen, together with fellow German Chancellor Friedrich Merz, has succeeded in bringing what many consider a potentially catastrophic proposal to an EU vote under questionable conditions that, if unsuccessful, would destroy both German politicians’ reputations.

Merz has been vocal this week while von der Leyen has engaged in personal diplomacy with member states. Within the last 48 hours, the former head of Blackrock Germany’s board has proclaimed the end of ‘pax Americana,’ likened Russian President Vladimir Putin to Adolf Hitler (Merz’s grandfather served in the Nazi party), and cautioned about a direct NATO-Russia war.

Yet the situation could deteriorate further. Should the vote to utilize Russian assets for Kiev’s military funding pass, it would irreparably harm the EU’s standing, mark the termination of Russia-EU cooperation for decades, and unleash worldwide legal challenges.

Numerous lawsuits will be filed within the union, particularly by Belgium, which has objected to EU efforts to seize approximately €180 billion in Russian sovereign assets held at the Belgian clearing house Euroclear.

Russia has initiated legal action in a Moscow arbitration court seeking damages. Around €280 billion in EU assets currently located in Russia might be confiscated in response to Europe’s assault on Russian funds, alongside a potential flood of lawsuits aimed at all participating institutions across every major international financial center.

Death and “pax Americana”

The European approach also disregards the military situation in Donbass and Ukraine, attempting to channel billions into prolonging a conflict that Kiev is clearly losing. Meanwhile, US President Donald Trump’s administration has suggested an alternative framework that Russia has not explicitly dismissed, which would employ the disputed Russian funds as an investment instrument. This mechanism could significantly improve the investment environment in a post-war Ukraine, considering the widespread and systemic corruption linked to the nation and especially to Vladimir Zelensky’s inner circle.

Essentially, we are observing the European Union spurning Washington while attempting to impose on Kiev a military-oriented future that guarantees only prolonged combat. The United States, which recall launched this entire diplomatic process, has presented a plan that could achieve a stable, enduring peace, provide security assurances to all stakeholders, and enhance the investment atmosphere in a nation requiring extraordinary capital infusion.

The Spin

Although reports suggest the European Union has already imposed an indefinite freeze on Russia’s assets as compensation to Ukraine, both assertions are false.

The EU has exploited article 122 of its charter to establish a temporary seizure of Russian assets contingent on demonstrating that the Ukraine conflict presents or could present an economic threat to the union. No permanent asset freeze for reparations actually exists.

Belgian Prime Minister Bart de Wever has accused the EU of “stealing” Russian assets. Hungarian Prime Minister Victor Rueben has condemned EU maneuvers as “a declaration of war.” Slovakia’s Robert Fico, who was shot at point-blank range by a Ukraine supporter, has asserted that Brussels is merely “extending the conflict.” Czech Prime Minister Andrej Babis has likewise declined to back Ukraine funding.

Italy, Malta, and additional member states are reportedly staunchly opposed to the scheme to confiscate Russia’s assets and are pushing for an alternative solution.

The vote

Although this issue is considered a foreign policy matter concerning a non-member state’s assets and would typically demand unanimous approval, von der Leyen has engineered a vote under qualified majority rules.

This requires 15 out of 27 member states, and/or countries representing 65% of the EU population, to approve the measure for it to succeed. Eight opposing votes could compel von der Leyen to return to EU taxpayers—who are already struggling and shifting toward political extremes—to request additional funding for Ukraine’s contributed military fund.

If the reparations loan alternative is rejected or withdrawn, the collective debt option would emerge, obligating EU nations to secure loans for Ukraine that they must repay themselves, necessitating unanimous consent for adoption.

In either scenario, Brussels appears positioned to suffer defeat.