CHRISTIANSTED, St. Croix – Group of Seven (G-7) leaders will discuss a new legal theory that would enable the seizure of US$300 billion (S$395 billion) in frozen Russian assets when they meet in February, two sources familiar with the plans and a British official said on Dec 28.
US and British officials have worked in recent months to jump-start efforts to confiscate Russian assets immobilised in Belgium and other European cities, and hope G-7 leaders agree to issue a stronger statement when they meet in late February, around the second anniversary of Moscow’s invasion of Ukraine, the three sources said.
The discussion takes place as US President Joe Biden faces Republican opposition to his request for another US$61 billion in aid to Ukraine, with US officials warning of dire consequences for the Ukraine war effort.
The United States, backed by Britain, Japan and Canada, has proposed that G-7 working groups develop options for G-7 leaders, the sources said, but cautioned against expecting “an actual announcement” about asset seizures during the late February meeting.
The new legal theory would allow asset seizures in “very specific circumstances” involving an aggressor country, one of the sources said.
“The US has been able to develop a legal theory for how Russia could be held accountable that we think will be held up internationally in the courts and will be widely recognised as legitimate,” the source said.
No decisions had been made, and several countries – including the US and Britain – would require legislative changes to establish the needed authorities to carry out such seizures, two of the sources said.
The Financial Times reported on Dec 28 that Washington had proposed setting up three working groups to examine the legal issues around confiscation; the method of applying such a policy and mitigating risks; and options for how to best channel the support to Ukraine.
G-7 leaders have long argued that Russia is obligated under international law to end its war and pay for the damage it has caused, which already exceeds US$400 billion, according to the World Bank.
In a Dec 6 statement, G-7 leaders said they would “explore all possible avenues to aid Ukraine in obtaining compensation from Russia, consistent with our respective legal systems and international law” and directed their relevant ministers to continue working on the issue.
One of the sources said there was still more work to be done, including convincing other countries to join in.
“This is something that the international community would need to collectively do in order to ensure it can be done effectively,” the source said, adding that some countries would only proceed if all European countries signed on.
The Financial Times noted that some European countries, including Italy – which takes over the G-7 presidency in 2024 – were wary, fearing the possible implications for financial stability and retaliatory action from Russia.
Moscow has already threatened to take retaliatory action against countries that seize its assets. REUTERS
