The European Union prepared legislation that would create a mechanism for Ukraine to get profits from frozen Russian sovereign assets in July, Bloomberg reported.
This week EU leaders are to discuss the proposal in Brussels, which would first require their backing. If approved, the plan would send an estimated €3 billion ($3.3 billion) per year, generated from taxes on profits from frozen Russian assets, to help finance Ukraine’s defense against Russia’s ongoing full-scale invasion.
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According to the EU proposal, income received from the frozen assets after Feb. 15, 2024, would be transferred to the European Peace Facility – the EU’s mechanism for reimbursing countries that delivered aid to Ukraine, including weapons – every six months.
Part of the profits generated from Russia’s frozen assets would go to cover asset management costs and deal with risks, including possible Russian countermeasures.
About €260 billion ($282 billion) of the Russian central bank’s assets, mainly in the form of securities and cash, were frozen by G-7 countries, the EU, and Australia – with more than two-thirds in the EU.
In the US, President Joe Biden’s administration has been pushing G-7 allies to seize the Russian frozen assets outright, but had resistance from some countries, including Germany, France, and the European Central Bank, Bloomberg reported.
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At home, the Biden administration has also been having difficulty getting aid to Ukraine.
Ukraine has been facing an artillery shortage and losing ground to invading Russian forces, as some $60 billion in planned US aid has been held up in Congress.
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