Russian authorities under President Vladimir Putin are now drafting a new bill allowing for the seizure of assets belonging to Western nations that have collaborated in illegally confiscating Moscow’s property and funds, Russian sources report, citing documents prepared by the government legislation commission. Russia’s assets and funds confiscated by Western nations are reported to be worth over 300 billion dollars, and now Russia is looking to respond to this provocation.
The draft bill initiated by Moscow outlines the legal procedure and emphasizes that target foreign assets that will now be transferred into Russian state ownership after a ruling by a court of arbitration. The list of properties and funds subject to seizure will be compiled by the country’s commission on foreign investments.
As per a report by the CNN, the United States had been pushing the European Union (EU) to seize Russian assets frozen within the bloc before the end of the Joe Biden Presidentship. Since the Ukraine war began three years ago, the US and its allies had frozen around $300 billion of Russian government funds, held mainly in the Euroclear system based in Brussels.
Earlier in May, Russian President Vladimir Putin had signed a decree laying the groundwork for confiscating assets of US companies and individuals to compensate for any Russian assets expropriated by Washington.
If adopted, the broader legislation will target “unfriendly” Western states and related individuals, allowing Moscow to seize assets as reimbursement for financial damages incurred by Russia from the illegal confiscation of its funds and properties, the draft legislation reads. The commission will reportedly review the draft bill as soon as next week.
Sources report that the bill was drafted by Russia’s Ministry of Justice and was included in the commission’s agenda on January 20. It has been noted that the document has been approved by the relevant authorities, including the Bank of Russia, the Finance Ministry, the Economy Ministry and the Ministry of Foreign Affairs.
Washington and its allies have frozen an astounding $300 billion of sovereign Russian assets held in the Brussels-based Euroclear, since the escalation of the Ukraine conflict in 2022. Kiev has been persistently urging its Western backers to expropriate Russia’s sovereign assets and use them to cover Ukraine’s military and reconstruction expenses.
The US administration headed by Joe Biden supported the proposal but European nations have rejected the idea due to mounting concerns over the illegitimacy of such a move, arguing that it could land a hard blow on the Western financial system and the reputation of the euro as well. Destroying the international trust in their processes and systems.
Plans under Biden
Western allies were also planning to impose a windfall tax on profits generated by the frozen Russian assets, and to spend the proceeds either directly to buy weapons for Ukraine or to offer them as collateral for a loan, which would then be used to bolster the country’s military. This move had been heavily backed by Ukraine President Volodymyr Zelensky. Zelensky, in a recent podcast interview, insisted Ukraine should get all the frozen funds. He said the money could support Ukraine’s domestic production and purchase more weapons from the US.
Russian officials quickly blasted Zelensky’s comments. Foreign Ministry spokeswoman Maria Zakharova called his remarks “nonsense” and accused him of promoting extremist views. The Kremlin has also repeatedly denounced the asset freeze as “theft” and argued that tapping into these funds would be illegal and set a dangerous precedent. Kremlin spokesman Dmitry Peskov has warned that Moscow will take legal action against those involved in the asset seizure.
Confiscating Russian assets will erode the confidence of the developing world on the West-backed financial system. There is a reason why BRICS nations, including giants like Russia, China and India, are mulling creating a currency of their own and even a parallel financial system, that is free of any Western interference. Today, each and every developing country has stakes and investments in EU and the US. These nations are reasonably worried that their own investments might someday be hijacked by the Western governments and would be used as a bargaining chip.
The way the West has treated Russian assets over the past three years has actually set alarm bells ringing in the global south. That is one reason why dozens of countries today are lining up to join the BRICS forum. Now Putin is getting ready to respond to these provocations in kind, he is fighting this battle on an even kneel and wants reciprocity. Moscow has not been the one to initiate these underhanded moves however Putin is in no mood to accept the West openly stealing Russian funds, and will respond as they see fit. With Donald Trump now looking for a peace deal perhaps the US will reconsider, but for now Russia has already begun its own response.
