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ES Author: Brian Haughton
What is REPO?
After Russia launched its full-scale invasion of Ukraine in February 2022, the United States and its allies formed the Russian Elites, Proxies, and Oligarchs Task Force (REPO), made up of the Group of Seven (G7), European Union (EU), and Australia. (Brookings)
In March of 2022, the European Commission established the “Freeze and Seize” task force to handle the freezing and seizure of EU-held Russian assets and implementation of EU level sanctions decided on by the Council of the European Union. Freeze and Seize comprises representatives from the European Commission, Europol (the EU’s body for policing cooperation), Eurojust (the EU’s body for investigation and prosecution of cross-border crimes), and national contacts from each member state. (European Commission)
Frozen Russian assets
Around $280 to $330 billion in Russian sovereign assets have been seized and frozen from across the REPO framework. Belgian financial securities depository Euroclear manages about $200 billion of those assets, roughly 90% of the total held in Europe. France holds the majority of the remaining 10%. Assets are also frozen in Japan amounting to about $50 billion. For comparison, the United States holds about $5 billion. (Brookings; AP)
By 2024 most of the debt securities matured into cash held in Belgium, which Euroclear put into money markets. Of the roughly $7 billion in accrued interest generated in 2024, the Belgian government collected about 25%, which it committed to sending to Ukraine. (Brookings) In May 2024, the Council of the European Union required the rest of the interest go to Ukraine. (Consilium of the European Union)
What’s Europe’s plan for supporting Ukraine?
The IMF estimates that Ukraine will require 135 billion euros ($161 billion) for its financial and military needs over the two-year period of 2026-2027. This funding is needed to allow Ukraine to maintain public services and support its defense efforts. (Kyiv Post)
According to a plan presented by European Commission President Ursula von der Leyen on December 3, 2025, the EU plans to cover two thirds of this sum: 90 billion euros. The remaining third (45 billion euros) is intended to come from other international partners. (AP)
а. Fund Ukraine via a ‘reparations loan’ – using the frozen assets as collatera
© European Union, 2025, licensed under CC BY 4.0 (audiovisual.ec.)
This plan – proposed by European Commission President Ursula von der Leyen as the Commission’s ‘Plan A’ – involves issuing a loan to Ukraine backed by the frozen Russian assets as collateral. Euroclear would be required to invest the frozen assets in a contract with the EU, with the EU lending the funds on to Ukraine. Ukraine would only be required to repay the loan after it receives reparations from Russia in compensation for damages caused by Russia’s invasion. (Reuters)
Belgium holds the majority of the frozen assets, and its consent is required to implement this plan. However, Belgium has expressed its opposition (Euronews):
The proposal, which has no precedent in modern history, has been met with serious reservations by both the Belgian government and Euroclear from the start.
Euroclear also worries that it would lack the necessary liquidity to honour its claim with the Russian Central Bank if the sanctions were lifted prematurely and member states failed to raise the €185 billion in time.
The Belgian authorities have also said they fear Russia will demand their assets be returned if they sue in court and win, leaving a gap in Belgium’s treasury equal to the size of the annual federal budget. Belgium has even suggested it could bankrupt the country.
The Council of the European Union passed a Regulation on 13 December freezing Russian assets indefinitely, using Article 122 of the Treaty on the Functioning of the European Union, which is used in cases of “exceptional circumstances” outside of a member state’s control. The EU has promised Belgium protection (Consilium of the European Union) but Belgian leadership has continued to reject both the reparations loan plan and the use of Article 122.
“This is money from a country with which we are not at war,” [Belgian Prime Minister] De Wever said, speaking to reporters at the Belgian parliament. “It would be like breaking into an embassy, taking out all the furniture, and selling it.” (Euronews)
b.Raising the funds through international borrowing instead
© European Union, 2025, licensed under CC BY 4.0 (newsroom.consilium.europa.eu)
Belgian Prime Minister Bart de Wever has proposed that Ukraine’s allies handle the cost of funding Ukraine on their own, and offered the taking on of debt as an alternative solution. (Euronews)
“If Europe wants to create money, it can create money. This is called debt. But, of course, this is also a very sensitive topic,” De Wever said at the end of the summit.
“The big advantage of debt is that you know it. You know how much it is, you know how long you will bear it, you know exactly who’s responsible for it,” he went on.
c. Not funding Ukraine at all
© European Union, 2025, licensed under CC BY 4.0 (newsroom.consilium.europa.eu)
Slovak Prime Minister Robert Fico has rejected the reparations loan plan and the taking on of more debt, and has refused to support Ukraine outright. (Reuters)
“I refuse to allow Slovakia to take part in any financial scheme aimed at helping Ukraine manage the war and military spending.”
Hungary has rejected the plan to take on more debt. (Politico) Hungary is also suing the Council of the European Union for ignoring its veto during the vote to send interest generated by frozen Russian assets to Ukraine, on the basis that Hungary is not a “contributing country” to the European Peace Facility, which is handling the transfer. (Hungary v. Council and European Peace Facility)
European Citizens Are Key to Release of Funds
The European Council, (a different institution than the Council of the European Union) which is made up of the heads of state of every European Union member country, is meeting on the 18th and 19th of December, and the reparations loan is on the top of the agenda. This means that showing domestic governments the importance of transferring frozen Russian assets to Ukraine is the best way to influence this outcome in the short term. The European Union is in favor of the reparations loan plan, but a handful of member countries (Belgium, Slovakia, and Hungary) could get in the way of the plan. If the plan is not adopted, Ukraine will struggle to fund its defense for 2026 and 2027, and Europe will be vulnerable.
Citizens from across the European Union can make their voices heard through elections (Hungary and Slovakia each have elections in 2026 or 2027) and choose governments that will strengthen the EU’s commitment to Ukraine, regardless of the outcome of the meeting of the European Council this December.
Következtetés
Discussions in the European Council summit on December 18th and 19th will be dominated by the issue of the reparations loan – or more specifically, resolving Belgium’s opposition to it. Should the issue not be resolved at the summit, the European Commission may consider funding Ukraine for 2026-2027 using the Belgian joint debt proposal. As Belgium holds the majority of the frozen assets, actions regarding the assets cannot be taken without Belgium’s consent. Hungary and Slovakia also may cause issues, especially if the EU moves to further circumvent their vetoes.
No matter the results of the December decision by the European Council, the need for Europeans to stay informed and engaged will remain paramount. In order to secure their borders and the safety of their people, Ukraine needs ordinary Europeans to step up and loudly demand that their governments do more to support Ukraine. Get involved today by signing up with EAU to join the team of passionate advocates in your own country. Be part of history, join this generation’s call to action. European Action for Ukraine.
