FACT-CHECK: Russia's Central Bank Attacks the EU in Luxembourg — Real Case or Delaying Tactic?

FACT-CHECK: Russia's Central Bank Attacks the EU in Luxembourg — Real Case or Delaying Tactic?

Introduction: Moscow in the Courts of the European Union

The verified facts of the Russian complaint

On February 27, 2026, the Central Bank of Russia filed a formal complaint before the General Court of the European Union in Luxembourg. The stated objective is the annulment of the EU Council regulation that indefinitely freezes approximately 210 billion euros of its assets. The Russian central bank alleges three distinct violations: breach of property rights, failure to respect sovereign immunity, and infringement of the principle of access to justice. This procedure is real, documented, and confirms that Moscow is now using the same European legal institutions it has long circumvented or ignored.

What this legal action is exactly, and what it is not, deserves rigorous factual examination. The Russian government and its foreign minister Sergei Lavrov described in June 2026 the funds sent to Kyiv from these assets as "stolen money." The EU, for its part, maintains that the freeze is legal and is preparing to use these funds to finance its 90 billion euro support loan to Ukraine for 2026–2027. Let us examine the claims of both parties.

The context of the 210 billion frozen

In the days following the February 2022 invasion, the G7 countries and the EU froze Russian sovereign reserves on their territory. In Europe, the vast majority — approximately 190 to 210 billion euros depending on estimates — is immobilized at Euroclear, the central securities depository based in Brussels. In December 2025, EU member states voted to freeze these funds indefinitely. That vote constituted the direct trigger for Russia's February 2026 complaint: Moscow specifically contests the change from "temporary" to "indefinite."

True or False: Russian Arguments Put to the Test

Claim 1: The freeze violates the "right to property"

THE RUSSIAN CLAIM: The EU Council regulation violates the property rights of the Central Bank of Russia by indefinitely freezing its assets without compensation.

THE REALITY: Partially true in its technical formulation, but inconclusive in its application. The EU Charter of Fundamental Rights does protect the right to property, but with explicit limitations for reasons of public interest. International economic sanctions have been systematically validated by European jurisprudence as proportionate measures to the circumstances. Furthermore, the Court of Justice of the EU has granted very broad margin of appreciation to the EU's political institutions in matters of foreign policy and sanctions. The property rights argument is legally admissible as a ground for appeal, but its probability of success is generally assessed as low by European legal specialists.

Claim 2: Sovereign immunity protects the Russian Central Bank's assets

THE RUSSIAN CLAIM: As the central bank of a sovereign state, its assets enjoy absolute sovereign immunity from seizure or freeze by third states.

THE REALITY: FALSE in the current context. Absolute sovereign immunity is a principle increasingly challenged in international law. Recent international jurisprudence — notably the ICJ in cases involving grave violations of international law — has progressively eroded the principle of absolute immunity. Moreover, EU sanctions do not constitute a "seizure" in the traditional sense — they freeze assets (preventing their movement) without transferring them. The distinction between freeze and confiscation is fundamental: the EU has not confiscated Russian assets, it has immobilized them. On this point, the European position is legally solid.

Lavrov's "Stolen Money" Claim

Russian rhetoric and the facts

THE RUSSIAN CLAIM (Lavrov): "The funds sent to Kyiv from the frozen Russian assets are stolen money."

THE REALITY: MISLEADING in its formulation. First, the Russian assets were not sent to Kyiv in their entirety — only the profits generated by the frozen funds (approximately 3 billion euros per year through Euroclear investments) are being used to partially finance support for Ukraine. The principal remains frozen at Euroclear, untransferred. Second, the characterization as "theft" ignores the legal framework of international countermeasures: under customary international law (ARSIWA), a normally unlawful measure becomes legal if it responds to a grave violation of international law by the targeted state — which Russia's invasion of Ukraine constitutes.

In December 2025, EU countries agreed to use these profits to finance a 90 billion euro loan to Ukraine over 2026–2027. The first disbursement of 3.2 billion euros was made on June 25, 2026. These are formal legal mechanisms — not theft.

The actual mechanism and the transparency of the procedure

The European legal framework for freezing Russian assets is among the most thoroughly documented in modern sanctions law. It has been subject to internal legal reviews by the European Commission, deliberations by the European Parliament, and votes by the EU Council. External analyses produced by leading law firms have concluded the freeze is legal. The fact that the Central Bank of Russia chose to plead before the General Court rather than first seizing the ICJ (International Court of Justice, of which Russia is a member) reveals its own anticipations about the likely outcome of an international appeal.

Probable Outcomes and Strategies on Both Sides

What Russia actually hopes to obtain

Legal observers agree on one point: the Central Bank of Russia probably does not expect to win this case on the merits. The strategic objective is elsewhere. First, buying time: a procedure before the EU General Court can take 3 to 7 years before a first-instance judgment. During that time, the EU might hesitate to take even more radical steps (such as total confiscation of the principal) for fear of complicating the proceedings. Second, feeding a diplomatic narrative: being able to say in international forums "we are contesting this freeze in European courts" gives Russia a veneer of legal legitimacy in its relations with Global South countries.

Third, it is possible — though unlikely — that the General Court might issue interim orders limiting the use of the assets during proceedings. In that case, Russia would have obtained a valuable tactical result. But the Court of Justice of the EU has systematically refused to suspend sanctions in similar cases, making this scenario unlikely.

The EU's preparation and legal response

The EU is not unarmed in the face of this procedure. The legal services of the European Commission and the Council have anticipated Russian appeals since 2022. Their defenses rest on three pillars: the legality of the sanctions under the EU's primary law, the proportionality of the measures relative to Russia's violations of international law, and the consistent jurisprudence of the Court of Justice on the margin of appreciation of institutions in matters of foreign policy. According to sources close to the European Parliament cited in June 2026 analyses, Brussels remains "steadfast" in its commitments to Ukraine.

The Stakes for Ukraine and the Implications of the Verdict

What happens if the EU loses?

In the very unlikely scenario where the General Court ordered the annulment of the freeze regulation, the EU would have several options. It could first appeal to the Court of Justice of the EU, extending the procedure by several more years. It could also adopt a new, legally more robust regulation, correcting any flaws identified by the court. The probability of an immediate return of the 210 billion to Russia is virtually nil, even in the event of an unfavorable first-instance ruling.

For Ukraine, the most immediate concern is maintaining the financing mechanism for the 90 billion euro loan. If the profits from frozen assets continue to be available (which an ongoing judicial procedure does not immediately challenge), disbursements to Kyiv continue. Ukraine received its first disbursement of 3.2 billion euros on June 25, 2026, and a second tranche of 6 billion dedicated to drones was announced for the following days. The Luxembourg procedure has no direct effect on these transfers for now.

The precedent for other frozen assets worldwide

The outcome of this case will have implications beyond the Ukrainian conflict. It will set a precedent on how far democracies can go in immobilizing the sovereign assets of aggressor states. If the General Court validates the indefinite freeze, it will considerably strengthen the West's legal arsenal against future aggression. If the court sets conditions or limits, those conditions will need to be incorporated into future legal instruments.

The Sanctions Precedent and the Frozen Russian Assets

The paralysis of 300 billion: a colossal financial stake

Behind the procedure before the Court of Justice of the EU lies a financial stake of unprecedented scale. The 300 billion dollars of Russian Central Bank assets frozen in Western institutions since March 2022 constitute the largest seizure of sovereign assets in modern history. The vast majority of these funds — approximately 210 billion — is managed by Euroclear in Brussels. The interest generated on these assets — several billion per year — has since 2024 been partially returned to Ukraine through the G7's ERA (Extraordinary Revenue Acceleration) mechanism.

Russia knows perfectly well that if this judicial procedure establishes a precedent that the freeze was legal, the next step could be permanent confiscation of the principal. This is precisely what legislation such as the American SABER Act or certain proposals within the European Parliament envision. Moscow's complaint is therefore not merely defensive over the 7 billion immediately at stake — it aims to block the entire legal architecture that would allow these assets to be permanently transferred to Ukraine.

The diplomatic stakes between Moscow and Brussels

The Luxembourg procedure unfolds in a diplomatic context degraded to a historical low. There is no direct dialogue between the EU and Russia on economic matters. Ambassadors have been recalled or their functions reduced to a minimum. The institutional channels that once resolved bilateral commercial disputes have all been suspended or closed. The Court of Justice of the EU thus becomes, by default, the only forum where both parties can formally confront each other.

This situation is unprecedented in the history of the European Union. Never before had a power hostile to the bloc used its own judicial institutions to contest a decision made within a sanctions framework following military aggression. European lawyers following this case stress that if the Court accepted Russia's argument, it would create a catastrophic precedent for the EU's future ability to use sanctions as a foreign policy instrument.

Analysis of International Legal Precedents

Landmark rulings on sovereign assets

The ICC, the ICJ, and arbitral tribunals have handed down several key decisions on sovereign assets over the past thirty years. In the Iran v. United States case before the ICJ, the court recognized the sovereignty of state assets while maintaining states' right to impose restrictive measures in response to violations of international law. The Kirkpatrick case in the United States established that sovereign immunity is not absolute when the state in question has itself violated peremptory international law. These precedents broadly argue against Russia's position.

More directly relevant: the ruling of the European Court of Human Rights in Nada v. Switzerland, which recognized that restrictive measures against a state or entity can be compatible with the fundamental right to property if they pursue a legitimate objective and are proportionate. EU lawyers rely in part on this reasoning to defend the legality of the freeze. The Union also invokes Article 60 of the Vienna Convention on the Law of Treaties, which authorizes the suspension of obligations in response to a material breach by the other party.

What recent jurisprudence reveals

It should be noted that Russia has itself accumulated jurisprudence against it in international forums. The Permanent Court of Arbitration has repeatedly ruled against Russia, notably in the Yukos cases and in proceedings relating to the nationalization of Ukrainian assets in Crimea. Each time, Moscow has ignored the decisions or refused to pay ordered compensation. This track record of non-compliance with international decisions considerably undermines Russia's credibility as a good-faith litigant — a factor that judges at the CJEU cannot ignore.

A state's consistency with respect to international law is an implicit factor in any judicial proceeding. Russia invoking the law in Luxembourg while ignoring arbitral verdicts unfavorable to it sends a profoundly contradictory signal. The Court is not blind to this structural contradiction.

Implications for Ukraine and Reconstruction

A favorable verdict: the optimistic scenario

If the CJEU rejects the Russian complaint — a scenario considered likely by most legal analysts — the implications for Ukraine would be considerable. First, the legality of the freeze would be confirmed by the highest European judicial authority, strengthening the position of countries considering going further toward permanent confiscation. Second, the interest generated by frozen assets could continue to be used to fund aid to Ukraine without additional legal risk. Third, this verdict would create a useful precedent for other similar proceedings that Russia might initiate in other jurisdictions.

For Ukraine, every additional billion from frozen Russian assets represents rebuilt bridges, repaired homes, reopened hospitals. The G7's ERA mechanism, which generated 50 billion euros in loans guaranteed by these interests, has already financed a significant portion of military and civilian aid in 2025. Consolidating the legality of this mechanism in the face of Russian challenges is therefore a concrete stake, measurable in humanitarian aid and reconstruction terms.

An unfavorable verdict: the catastrophe scenario

An unfavorable verdict — even partial, even limited to procedural aspects — would send a devastating signal. It would offer Russia an enormous rhetorical victory: proof that Western democracies cannot even maintain their own instruments of pressure against an aggressive power without being contradicted by their own courts. Moscow would immediately exploit such a verdict to weaken existing sanctions regimes and block any debate on permanent confiscation of assets. This scenario is considered unlikely by most experts, but it is not zero.

The probability of such a reversal is judged low but not non-existent. The CJEU is an independent institution, and its decisions cannot be presumed. Moscow's arguments about violations of formal procedures deserve to be heard, even if their substance is generally rejected. A decision on procedural points could theoretically give Russia a partial victory without validating the substance of its complaint.

Conclusion: A Trial That Reveals More About Russia Than About the Law

The fact-check verdict

Summary of the fact-check: Russian claims about the violation of property rights are admissible as grounds for appeal but have a low probability of success on the merits. The argument for absolute sovereign immunity is false in the context of the freeze (non-confiscation) and of recent international jurisprudence. Lavrov's claim about "stolen money" is misleading: it conflates freeze and confiscation, ignores the legal framework of countermeasures, and misrepresents the actual mechanism for using profits. The procedure itself is real, but its strategic objective is delay and propaganda, not legal victory.

What is true in all of this is that Russia is using the European legal institutions it helped undermine — by contesting ICC decisions, blocking UN mechanisms, refusing to execute ECHR rulings — to defend its own financial interests. Law is not a principle for Moscow. It is a tool. And in this specific case, it is a tool for delay.

Ukraine and the resilience of the European legal framework

For Ukraine, this procedure confirms that the road to justice — and to using frozen Russian assets to finance reconstruction and defense — will be long and strewn with legal obstacles. Zelensky knows this. That is why he works simultaneously on several fronts: legal, diplomatic, and military. The first disbursement of 3.2 billion euros of the European loan, paid despite the ongoing Luxembourg procedure, shows that the EU is not paralyzed by Russian appeals. The mechanism moves forward. The law moves forward too, in its characteristic slowness. And in the meantime, Ukraine keeps fighting.

By Maxime Marquette, columnist

Columnist's transparency note

Method and limits

This fact-check relies on publicly available sources — legal analyses, official statements, verified press articles. I am not a specialist in EU law or international sanctions law. My assessment of the probability of success of Russian arguments is based on syntheses of expert analyses cited in sources, not on my own legal reasoning. Since the procedure before the General Court is ongoing, any prediction about its outcome remains speculative.

My stated biases

I support maintaining the freeze on Russian assets and their use to support Ukraine. I consider the European legal framework of the freeze to be legitimate and proportionate. These positions inevitably influence my assessment of Russian arguments, even if I have tried to evaluate them as factually as possible.

Sources

Primary sources

Ground News — Russia's Central Bank Sues EU in Luxembourg Over Frozen Assets — June 23, 2026

TASS — Funds from Russian assets sent to Kiev are stolen money, Lavrov — June 24, 2026

EU Perspectives — Brussels steadfast on Ukraine commitment, MEPs hear — June 23, 2026

Secondary sources

Wikipedia — Confiscation of Russian central bank funds — updated 2026

European Parliament — Financing Ukraine in 2026 and 2027 — December 2025

Kyiv Independent — Ukraine receives first tranche of 90 billion euro loan from EU — June 25, 2026