EU ready to back Belgium in frozen assets war against Russian oligarchs
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Russian oligarchs stepped up their legal maneuvering against Belgium in a fresh bid to claw back 185 billion euros ($217 billion) in assets frozen since Moscow launched its full-scale invasion of Ukraine in February 2022, but the chances of their success remain slim.
The investors have initiated no fewer than nine cases, Belgium's Dutch and French-language financial newspapers, De Tijd and L'Echo, reported on May 5, which comes on top of over 200 proceedings brought to the country's supreme court, all of which have failed.
For Russia, the stakes are high. Belgium alone holds the lion's share of its global frozen assets — 185 billion euros of the roughly 260 billion ($305 billion) held globally, which the EU immobilized in the first days of Russia's full-scale invasion of Ukraine.
"These cases have so far failed, largely because… EU law has strong primacy (over national law) within EU Member States," said Juraj Majcin, an analyst with the European Policy Center think tank in Brussels.
"This principle has been repeatedly confirmed by the Court of Justice of the European Union."
The difference this time is that instead of going to court, Russia's oligarchs are relying on a 1989 investment treaty, which Belgium and Luxembourg signed with the Soviet Union, to go via international arbitration.
Instead of facing a judge or a jury, the two parties in an arbitration appoint a lawyer specialized in the topic of dispute, who together appoint a third lawyer to preside over the arbitration tribunal.
The venue has not been announced, but Majcin noted that the 1989 treaty suggested the Stockholm Chamber of Commerce in Sweden as a possible venue.
"The risk for Belgium is that, if it does not sufficiently defend its position under international law, the arbitral tribunal could decide in favor of the oligarchs… and take the view that EU law is simply part of Belgium's domestic legal order and therefore cannot be invoked to justify a breach of international legal obligations," Majcin warned.
Still, Belgium does not have to face the repeated legal assault on its own.
"The Commission is ready to assist Member States in defending claims which are linked to EU sanctions, where necessary," a European Commission spokesperson told the Kyiv Independent.
And even if Belgium were to lose in the tribunal, enforcement of the ruling would still depend on Belgian courts, which can refuse on the grounds that doing so would conflict with EU sanctions and the primacy of EU law, Majcin said.
The European Commission has maintained that "the EU's sanctions are consistent with EU and international law" and were imposed in response to Russia's "illegal war of aggression against Ukraine."
