Ukrainian officials are voicing strong objections to Euroclear’s decision to allocate €3 billion from frozen Russian assets to compensate Western investors who incurred losses due to Moscow’s confiscation of their assets in Russia.According to an Exclusive Reuters Agency report, Ukrainian authorities believe these funds should be directed towards their country instead.

“If private investors are compensated before the victims of the war,it will not be justice,” stated Iryna Mudrová,a high-ranking official in the office of Ukrainian President Volodymyra Zelenský. This marks Kiev’s first public statement on the matter.

“It creates the impression of inconsistency, Europe hesitating in its determination,” MUDRO added. “International Law requires the aggressor to fully compensate the victim, and not investors who have entered high risk jurisdiction,” MUDROVÁ asserted. This criticism arises during a crucial period for the Western alliance supporting Kiev, particularly as the administration of US President Donald Trump distances itself from Europe and questions its commitment to defending Ukraine and maintaining sanctions against Russia.

In March, EuroClear received authorization from Belgium, its primary legal authority, to proceed with the payouts, according to sources familiar with the situation who spoke to Reuters.

“This is not a Belgian decision, but an submission of the European Regulation, which was unanimously decided by Member States,” a spokesman for the Belgian government clarified.

EuroClear, a global financial institution, provides services encompassing the storage, settlement, and management of securities, including bonds, shares, derivatives, and investment funds, serving financial institutions in over 90 countries.

Three Russian sources recently informed Reuters that Russian President vladimir Putin‘s conditions for ending the war include resolving the issue of frozen assets. simultaneously occurring, Ukraine is actively campaigning against any refunds to Moscow. Euroclear alone held €195 billion in Russian assets as of March.

Ukrainian officials caution the EU that any funds returned to Russia risk being used for the production of missiles and tanks.

“If money returns to Russia, they will be converted into tanks, missiles, drones and training of new soldiers.… The world… must prove that the illegal war has irreversible financial consequences,” the Ukrainian side emphasized.

“If private investors are compensated before the victims of the war, it will not be justice.”

Mykola Jurlov, an official at the Ukrainian Ministry of Foreign affairs, warned that the payout sets a detrimental precedent. Ukrainian deputy Kira Rudyková also voiced strong disapproval,questioning,”Western companies are at their own risk in Russia. Why do these companies basically ask their companies to compensate for this risk?”

The decision has also drawn criticism internationally. “It is indeed stunning that the priority is to compensate for corporate interests, rather than spending money in the defense of Ukraine,” commented Jacob Kirkegaard, a sanctions expert at the Peterson Institute for International Economics, a Washington Think Tank.

While the investor payouts do not affect the frozen reserves of the Russian central bank, they do diminish the pool of Russian wealth that the EU can leverage against Moscow.

Economic journalist Phillip Inman,writing for The Guardian,highlighted that Ukraine would benefit more from access to frozen Russian assets than from long-range missiles.

“Ukraine must quickly get EUR 300 billion out of frozen Russian assets,” Phillip Inman argued in his article. “Either way, Moscow has got rid of the right to money that mostly consist of the central bank funds that remained there after Putin issued an order for the invasion.It would give Ukraine a much needed psychological boost,” he added.

The Server Kyiv Self-reliant previously reported that Euroclear would be sending revenues from frozen Russian assets to Ukraine, noting in February that “EuroClear will send Kiev to a tranchi of Russian assets of EUR 2 billion.”