Background
Since the Russian Federation launched its full-scale invasion of Ukraine in February 2022, reconstruction in Ukraine is estimated to cost at least $486 billion and rising. Although around an estimated $300 billion worth of Russian Central Bank assets have been frozen by sanctions made in response to the full-scale invasion, international legal and political considerations have so far prevented the EU and allied states from confiscating them and using them to support Ukraine.
The EU’s windfall profits measure
In July of this year, the EU announced it was using the “extraordinary revenues” gained from the Russian Central Bank assets frozen within EU Member States to send to Ukraine. So far, €1.5 billion has been sent to Ukraine, largely for defence purposes, with an estimated €3 billion expected per year moving forward. The EU has argued that the funds do not belong to the Russian Federation and therefore the legal issues relating to outright confiscation of the Russian Central Bank’s assets do not apply.
The potential reparative value of the windfall profits measure
Following an analysis of the legal acts created by the EU to put the windfall profits measure into place, Sexton and Kerr suggest that the destination of the funds is reconsidered. Although recognising the utmost importance of continuing to support Ukraine’s defence, they argue that these particular funds (or a large percentage of them) should be funnelled directly towards those who have suffered from the war. For Sexton and Kerr, doing so would have a positive impact for victims – both practically and symbolically.
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About the authors
James Patrick Sexton is a PhD researcher in public international law at the T.M.C. Asser Instituut and the University of Amsterdam. At the T.M.C. Asser Instituut, James is a member of the research strand: 'In the Public Interest: Accountability of the State and the Prosecution of Crimes'. His research interests lie within the law of armed conflict, international criminal law, unilateral sanctions, and the (international) legal aspects of countering terrorism. Additionally, James is the Managing Editor for the Yearbook of International Humanitarian Law.
Victoria Kerr is a Consultant and Associate Fellow to the research strand 'In the public interest: accountability of the state and prosecution of crimes. She works primarily on the MATRA-Ukraine project ''Strengthening Ukraine’s Capacity to Investigate and Prosecute International Crimes", a joint initiative of the Asser Institute and Global Rights Compliance (GRC), and the Restoring Dignity and Justice project. Victoria's research interests lie in international criminal law, international humanitarian law, and international human rights law, as well as sanctions, asset confiscation and reparation.
