BLANK CHECK GUARANTEES FOR BELGIUM
The main problem still to be resolved by EU leaders on Thursday is Belgium’s demand that others in the 27-nation bloc share the financial risks if Russia were to successfully sue either Belgium or Euroclear in international courts.
“(Belgian Prime Minister Bart) de Waver effectively wants a blank check for forever from other EU governments for all financial consequences that can befall Belgium for releasing the Russian assets,” a third EU diplomat said.
“Other EU governments are willing to go quite a long way to accommodate Belgium, but obviously there is some resistance to the idea of a blank check forever,” that diplomat added.
Other sticking points, which the EU ambassadors will try to resolve at meetings this week include bilateral investment treaties with Russia that 18 EU countries still have and which the European Commission wants them to rescind.
Withdrawing from the bilateral treaties is important because Russia uses them through the Investor-State Dispute Settlement (ISDS) to challenge EU sanctions. This allows Russian oligarchs and entities to sue EU countries and they could also be used by to challenge the use of Russian sovereign assets for Ukraine.
A further obstacle is France’s demand that Ukraine use the money it gets from the EU under the reparations loan to buy defence equipment only from Europe and not from other suppliers such as the United States.
The Reparations Loan is the preferred option for most EU countries to keep Ukraine fighting because it does not involve immediately spending large amounts of their own money or new joint borrowing.
Ukraine’s President Volodymyr Zelenskyy called on Tuesday for European unity on the frozen assets.
“I do not see an opportunity to stand strong without this support,” Zelenskyy told reporters in The Hague, where European leaders earlier launched an International Claims Commission to help ensure Kyiv is compensated for hundreds of billions of dollars in damage from Russian attacks and alleged war crimes.
