Stephen Kelly is an Irish lawyer practising in the areas of civil and criminal litigation
Current proposals to seize[1] Russian state assets to fund Ukraine’s military needs are at the core of a standoff between Belgium and other EU member states[2]. Belgium, where the assets are mostly domiciled, is resisting the move[3]. It is submitted that the weight of international law is very much on Belgium’s side. No matter how much some may strain to rewrite international law, it is extremely unlikely that EU proposals would be upheld by an international court.
The issues are not entirely new. The European Court of Human Rights has considered the question of state immunity, notably in the case of Al-Adsani v United Kingdom[4]. In this, the applicant (who had been tortured in Kuwait) was unsuccessful in convincing the Court that Kuwait’s state immunity for damages could be lifted.The Court affirmed sovereign immunity as a principle of international law according to which one state could not be subject to jurisdiction of another state[5]. While recognising the importance of the prohibition on torture, it dismissed the claim that this disentitled a state to immunity[6].
In 2012, the International Court of Justice delivered its judgment in Germany v Italy[7]. Elderly victims of German wartime atrocities had successfully sued Germany for damages in the Italian courts[8]. When Germany refused to pay, certain awards were enforced against assets in Italy owned by the German government. In particular, the Court of Appeal in Florence allowed a legal charge to be registered over German state property situated in Italy near Lake Como[9]. Germany then took Italy to court for violating German state immunity. (It is notable that there was no dispute concerning the unlawful nature of the conduct complained of, whose illegality was admitted at all stages of the proceedings[10], and neither does it appear the distinction between postwar Germany and the Nazi regime was pressed.) The International Court of Justice agreed with Germany. Regarding the principle of state immunity:
“The Court considers that the rule of State immunity occupies an important place in international law and international relations. It derives from the principle of sovereign equality of States, which, as Article 2, paragraph 1, of the Charter of the United Nations makes clear, is one of the fundamental principles of the international legal order”[11].
As the Court noted, the decisions of the Italian courts were outliers in comparison to decisions of other national courts on state immunity, including decisions of courts in formerly occupied countries such as France, Poland and Slovenia on the precise question of German reparations[12]. The Court was clear that there was a distinction between non-immunity for criminal acts an individual could be punished for versus the ability to claim damages against a foreign government. Accordingly, it did not follow from decisions which restricted state immunity for former heads of state or government officials that state immunity could be lifted in proceedings for damages or reparations[13]. Under customary international law, even accusations of “serious violations of international human rights law or the international law of armed conflict” could not justify depriving a state of its immunity[14].
Regarding the charge that had been registered against German state property in satisfaction of the claims, the Court held:
“[I]t suffices for the Court to find that there is at least one condition that has to be satisfied before any measure of constraint may be taken against property belonging to a foreign State: that the property in question must be in use for an activity not pursuing government non-commercial purposes, or that the State which owns the property has expressly consented to the taking of a measure of constraint, or that that State has allocated the property in question for the satisfaction of a judicial claim.
[…]
In these circumstances, the Court finds that the registration of a legal charge on Villa Vigoni constitutes a violation by Italy of its obligation to respect the immunity owed to Germany”.[15]
As a judgment from the world’s highest court, this represents the definitive statement on the subject. Indeed, Italy’s case in that dispute was, if anything, stronger than the case European leaders are seeking to make for the seizure of Russian assets. The arguments on the pro-seizure side are that it could be lawful to seize Russian assets if they are treated as some sort of collateral (the “collateral argument”) for damages Russia allegedly owes to Ukraine for the invasion and the costs of the occupation and war. If Russia makes good on these unspecified damages it owes, then the frozen Russian assets can be returned to Russia[16]. This is in spite of the fact that Ukraine is not an EU member state, and the EU is not, and does not describe itself as being, directly at war with Russia.
This contrasts with a situation in which (between 1943 and 1945) Italy had been directly occupied by its former ally. Added to this, Germany consistently admitted the war crimes in question, something strongly denied by the Russian Federation. Treating the seizure of Russian assets as being enforcement of some kind of collateral does not progress matters, because the EU must be entitled to enforce against the assets in the first place. The fact that Italy had violated Germany’s immunity by simply registering a charge over German property makes clear that enforcement does not have to amount to confiscation in a final sense to be unlawful.
It is clear – and, it is submitted, would be clear to any court – that the collateral argument is in any event not a proposal being made in good faith. The requirement to act in good faith is a core and longstanding principle of international law[17]. The collateral argument has developed as a means of fulfilling Ukraine’s defence requirements in a way that is intended to reduce the legal risk in outright seizure of Russian assets. This is reflected in some of the conditions that are proposed for the EU loan to Ukraine, including a requirement that Ukraine must prioritise EU/EEA countries in the defence procurement that the loan is designed to support[18]. The stated objectives are promotion of “macro-financial stability” for Ukraine and support of Ukraine’s “defence industrial capacities”[19] and not payment of compensation to alleged victims of Russian aggression. The Explanatory Memorandum to the proposed regulation further elaborates that:
“In this context of difficult debt dynamics of Ukraine due to the on-going Russian aggression and the challenges associated with Member States finances, including as [a result] of Russia’s actions, it is appropriate to develop an innovative solution that is not expected to place a financial burden on either Ukraine or Member States”[20].
With all due respect to proponents of the proposal, it is absurd to think that a court would accept this proposal as a move taken in good faith to enforce Russia’s alleged obligations to pay compensation when its stated objectives are to find a means of financing the war that minimises the costs for EU members and which, even more audaciously, seeks to exploit Ukraine’s desperate position to enhance the profitability of the EU/EEA arms industry.
For the same reason, the idea that the seizure could be classified as a justified “countermeasure” can be ruled out. This line of argument accepts that the seizure would be in itself unlawful, but can be made lawful as a response to the allegedly unlawful acts of Russia and to induce Russia to comply with its legal obligations, to include reparations[21]. This is primarily based on the International Law Commission’s Articles on State Responsibility for Internationally Wrongful Acts[22]. Even if countermeasures in principle could be justified in these circumstances, they are required to be proportionate[23]. Seizure of Russian assets to improve Ukraine’s “defence industrial capacities” and bring in orders to the European arms industry cannot be described as a proportionate step in inducing Russia to comply with alleged compensation obligations.
Even if the purpose of the seizure were to be confined to the question of compensation, there is no authority to support the claim that such damages would equal or exceed the €210 billion, being the estimated total of Russian central bank cash and asset reserves held in the EU[24]. The largest compensation award ever made by the International Court of Justice was $325 million[25], which was in Congo (Kinshasa) v Uganda[26]. The EU is asking us to accept that there is a sum of compensation owing that is itself unknown and unquantified (and based on a court order that has never been made), but that we nonetheless know is equal to or greater than the €210 billion in Russian assets. Respectfully, this is not a tenable proposition.
It is not difficult to see that allowing states to take countermeasures based on hypothetical judgments of international courts would make the international justice system underpinned by the International Court of Justice completely unworkable. Countries occupied in World War II by Axis powers, and by Germany and Japan in particular, could equally seek to take enforcement action on foot of unpaid restitution they contend is owing. This is not an academic point. Moves to re-open the issue of World War II reparations have been made by Poland[27] and Greece[28]. As noted by Ingrid Brunk:
“State practice in favour of countermeasures to obtain reparations appears to be effectively nonexistent, even for those who are generous in how they characterise state practice supporting countermeasures. Denial of immunity as a countermeasure is also generally unclear and contested. The absence of state practice of third-party countermeasures against central bank immunity suggests, in this context, that such measures are not permissible. That is especially true because if central bank assets can be the subject of countermeasures in response to Russian aggression in Ukraine, denial of immunity for central bank assets would also be a permissible response to other violations of erga omnes norms – which are apparently quite broad.”[29]
Of course, the foregoing approaches the issue from the perspective of public law. Private law considerations will also be highly relevant, although understandably the exact terms on which the assets are deposited are not in the public domain. The terms likely include recourse to arbitration and where property rights of EU citizens are affected there could be scope for a remedy under Article 17 of the Charter of Fundamental Rights. Based on what we know about the EU’s proposal, it is little more than a contrived and unconvincing means of circumventing long-established legal principles and the fact that the Union is pursuing such a matter should be a cause of grave disquiet.
[1] It is proposed to use the term “seize” to refer to the different actions of enforcement that may taken against the assets, whether confiscation, registration of a charge, etc.
[2] Bjarke Smith-Meyer and Hanne Cokelaere, “Here’s how EU capitals would divvy up Ukraine loan backstop under €210B frozen assets plan” (Politico, 7th Dedember 2025) <https://www.politico.eu/article/eu-capitals-frozen-assets-loan-ukraine-russia-war-finances/> (accessed 9th December 2025)
[3] Ibid.
[4] Application number 35763/97 (21st November 2001)
[5] Ibid., 17
[6] Ibid. 21
[7] Jurisdictional Immunities of the State: Germany v Italy (Greece intervening), Judgment, ICJ Rep 2012, 99
[8] Ibid. 114
[9] Ibid. 116
[10] Ibid. 125
[11] Ibid. 123
[12] Ibid. 133
[13] Ibid. 138
[14] Ibid. 139
[15] Ibid. 148
[16] M. Kartal, “What Europe can and cannot do with Russia’s frozen assets” (Good Authority, 17th October 2025) <https://goodauthority.org/news/what-europe-can-and-cannot-do-with-russias-frozen-assets/> accessed 6th December 2025; A. Moiseienko, “Frozen Russian State Assets: The Key to Enforcing the Largest Financial Debt of Our Times”(Verfassungsblog, 4th April 2025) < https://verfassungsblog.de/frozen-russian-state-assets/> accessed 6th December 2025
[17] M. Shaw, International Law (8th ed., Cambridge University Press 2017) 77
[18] Article 13, Proposal for a Regulation of the European Parliament and of the Council, 3rd December 2025
[19] Ibid., Art. 2(2)
[20] Explanatory Memorandum, Ibid. 2
[21] Moiseienko, Verfassungsblog
[22] Ibid.
[23] Article 51, Articles on Responsibility of States for Internationally Wrongful Acts
[24] Explanatory Memorandum, Proposed Regulation, 3
[25] European Parliament, Legal options for confiscation of Russian state assets to support the reconstruction of Ukraine (February 2024, European Parliamentary Research Service) 32
[26] Armed activities on the territory of the Congo (Democratic Republic of the Congo v Uganda), Judgment, ICJ Rep. 2022
[27] Aleksandra Krzysztoszek, “Polish president renews call for German war reparations” (Euractiv, 2nd September 2025) <https://www.euractiv.com/news/polish-president-renews-call-for-german-war-reparations/> accessed 6th December 2025
[28] Associated Press, “Greek leaders tell German president a WWII reparations claim is very much alive” (30th October 2024) <https://apnews.com/article/greece-germany-steinmeier-wwii-reparations-nazis-sakellaropoulou-6ac481fbae46ba56653faeeb1af35d3b> accessed 6th December 2025
[29] Ingrid Brunk, “Central Bank Immunity, Sanctions and Sovereign Wealth Funds” (2023) 91 Geo Wash L Review 1616 at 1652
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