The ambassadors of the Member States to the European Union (Coreper) reached unanimous agreement, on Wednesday 8 May, on the legislative proposal to mobilise the profits generated by the Central Bank of Russia’s asset frozen in the EU since the start of Russia’s military aggression against Ukraine (see EUROPE 13375/8).
This proposal is the second stage in a sequence that began with the sequestration, effective since 15 February, of the revenues generated by the €210 billion in Russian assets frozen in the EU, mainly by the Belgium-based company Euroclear (see EUROPE 13348/10).
In practical terms, Member States with central securities depositories holding more than one million assets of the Bank of Russia will have to allocate these profits, estimated at a total of around €3 billion per year, as follows: 90% of the amounts collected will go to the ‘European Peace Facility’ (EPF) and 10% to the ‘Ukraine Facility’ via the EU budget.
Previously, the CSDs concerned will have applied a deduction of 0.3% to cover their management costs, instead of the 3% initially proposed by the European Commission. They will also have the option of applying a further 10% withholding to cover certain costs, in particular those associated with potential litigation initiated by Russia.
Prior to the mobilisation of these profits generated by the Russian Central Bank’s assets, Belgium taxes these profits at a rate of 25% as national corporation tax. These sums (€1.7 billion in 2024) are then paid into a national fund for Ukraine and are all paid back to Kyiv in the form of bilateral aid.
The agreement still has to be formally adopted by the EU Council so that the first payments can be made as early as this summer. (Original version in French by Mathieu Bion)