ARTICLE
6 March 2024

EU Council Regulates Handling Of Immobilised Russian Assets

H
Harneys

Contributor

Harneys is a full-service offshore law firm offering expert legal advice on the laws of jurisdictions including the British Virgin Islands, Cayman Islands, Luxembourg, and more. Established in 1960, the firm has grown to 11 global locations with over 180 lawyers, serving top law firms, financial institutions, investment funds, and high-net-worth individuals. Harneys provides comprehensive legal support across transactional, contentious, and private client matters, often in collaboration with Harneys Fiduciary, which delivers corporate and wealth management services. Known for its role in shaping offshore jurisprudence, the firm also advises on legislative developments and excels in handling complex cross-border transactions and disputes.

On the 12 February 2023, the EU Council has decided to regulate the handling of assets belonging to the Central Bank of Russia which are immobilised due to EU sanctions.
European Union Corporate/Commercial Law

On the 12 February 2023, the EU Council has decided to regulate the handling of assets belonging to the Central Bank of Russia (CBR) which are immobilised due to EU sanctions. Financial institutions holding these assets must segregate revenues and follow specific rules. Central Securities Depositories (CSDs) with over €1 million of CBR assets must separate extraordinary cash balances and revenues, and are prohibited from disposing of net profits.

Considering the risks and expenses associated with holding assets and reserves of the CBR, each CSD has the option to seek approval from its supervisory authority to release a portion of the net profits in order to meet statutory capital and risk management obligations. The European Council may later decide to allocate a portion of these profits to support Ukraine's recovery.

Approximately €260 billion worth of assets belonging to the CBR have been rendered immobile in the form of securities and cash across the jurisdictions of the G7 nations, the EU, and Australia, with over two-thirds of these assets immobilized within the EU.

EU Council's press release can be found here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More