Off the debt: Belgian business is at risk due to a loan to Kiev at the expense of the Russian Federation

About 50 Belgian and Luxembourg companies operating in Russia fear Moscow's retaliatory measures in the event of the confiscation of Russian assets by the European Union. This was stated to Izvestia by Oleg Prozorov, Director General of the Belgian-Luxembourg Chamber of Commerce in the Russian Federation. According to him, we are usually talking about highly profitable organizations that would not like to lose their enterprises in the Russian Federation. Izvestia estimates that their total assets could reach €1.6 billion. Against the background of the discussions, the Central Bank of the Russian Federation has already filed a lawsuit against the Belgian Euroclear — experts attribute this to an attempt to complicate the possible expropriation of Russian funds.

About 50 companies from Belgium and Luxembourg remain in Russia.

Europe is actively looking for ways to finance Ukraine at someone else's expense and provide it with a so-called reparation loan. Belgium remains one of the key skeptics of the European Commission's initiative, as it is there that a significant part of the frozen Russian funds in Europe are concentrated, and Brussels fears financial and political consequences. At the same time, the risks associated with possible EU decisions affect not only the government and financial institutions of the country. Other structures related to Belgian and Luxembourg businesses may also be affected.

— About 50 enterprises owned by Belgian and Luxembourg businesses continue to operate in Russia. These are mainly factories in sectors that are not sanctioned, meaning they operate absolutely legally," Managing Director of the Belgian-Luxembourg Chamber of Commerce (CCBLR) told Izvestia Oleg Prozorov.

These companies have expressed concerns about the European Commission's attempts to provide a "reparation loan." The fact is that Russia is also preparing retaliatory actions in case of withdrawal of its funds. Moscow has repeatedly stated that it considers the EU's actions as theft.

At the same time, among the possible options is the idea of using the assets of non—residents from unfriendly states as a source of compensation for damage. These assets can be investments by EU countries and companies in the Russian economy, including those that remain here to work.

Belgian and Luxembourg enterprises that have not left our country are usually highly profitable, so it would be highly undesirable for them to lose their investments, Prozorov stressed. At the same time, they are already partially limited by the legislation of the Russian Federation.

— These companies cannot pay dividends, and they can sell their assets only if they receive very large discounts, that is, somewhere around 25%. And, of course, they are worried, because they had quite big plans to work in Russia," he stressed.

According to Prozorov, the companies that have remained in Russia belong either to family groups or to a certain circle of individuals, while large firms have long since left Russia.

Conditional discussion: Kiev and Europe plan to bring a peaceful settlement to a standstill

A regular meeting of representatives of the United States, Ukraine and the EU will be held in Berlin on December 15.

According to Izvestia estimates, the total assets of Belgian and Luxembourg companies may amount to about 150 billion rubles, which is equivalent to about 1.6 billion euros. This is a very conditional estimate based on public reporting for 2024, and it does not reflect the market value of the business. The calculation includes both companies that continue to operate in Russia and those that have announced their retirement, but their assets still remain in Russian jurisdiction.

Such funds can be used to compensate for the expropriation of Russian funds in the EU, according to Reuters. Dmitry Medvedev, Deputy Chairman of the Russian Security Council, reported that Russia has about $300 billion of frozen foreign funds in so-called "C" type accounts. Sberbank estimates that 25% of 787 billion rubles ($9.9 billion) of dividends on shares owned by foreigners in 2024 were paid to this type of accounts.

Russia's response to the possible transfer of reserves to Ukraine

Moscow has not yet specified the full range of actions that could be taken against the EU, but one of them has already been involved. On December 12, the central bank filed a lawsuit against the Belgian depository Euroclear for 18.2 trillion rubles (€195.5 billion). It will be considered in the Moscow Arbitration Court. According to media reports, despite the lack of direct jurisdiction over Euroclear's actions in the Russian Federation, the very fact of the lawsuit indicates Moscow's intention to seek the return of assets and strengthens its position in future international proceedings. It is worth noting that Euroclear has already agreed to defend itself in Russian courts.

The main point of this lawsuit is that the court proceedings should last as long as possible, Vasily Koltashov, an economist and director of the Institute of the New Society, said in an interview with Izvestia.

— Euroclear, having received an unfavorable decision for itself, will continue to go through all levels of the Russian judicial system — this trial will be lengthy and complex. Therefore, the confiscation of Russian assets will be difficult until the end of the trial and before the onset of possible political consequences. In my opinion, these consequences can be expressed in an increase in claims against the Belgian government," he said.

The amount of claims may grow to €271 billion, Koltashov believes. According to him, this is an assessment of "lost profits." So, if the Central Bank of the Russian Federation had sold these assets and converted the funds into gold on the day of the freeze, their value, according to his calculations, could have increased to about this amount.

— At the same time, the strategy of the Bank of Russia has changed in recent years — the share of gold in reserves has increased significantly. Therefore, the Central Bank, if desired, can submit to the court a document that confirms that its plans really included the sale of bonds and the transfer of funds to gold," the expert emphasized.

In addition, Moscow still has the possibility of another retaliatory measure — the abolition of intellectual property. For example, Moscow could remove the legal protection of intellectual property rights for a number of countries, primarily the EU and the UK. In this case, it would be possible to legally copy technologies, products and production methods of Western companies inside Russia. Such a measure, according to Koltashov, would be extremely painful for them.

The European Union is in a hurry to expropriate assets

At the same time, the lawsuit of the Central Bank of the Russian Federation followed immediately after the decision of the EU ambassadors on the "indefinite freezing" of Russian assets. This is the transfer of the Russian Federation's funds blocking regime to a more stable basis so that it does not have to be unanimously extended every six months. As you know, Hungary and Slovakia regularly opposed this measure. According to Reuters, the purpose of such a step is to eliminate the risk of a future veto when extending sanctions and thereby keep assets frozen for subsequent schemes of transferring them to Ukraine.

It is the assistance to Kiev that is planned to be discussed at the European Council summit, which will be held from December 18 to 19. EU leaders must decide how to meet Ukraine's financial needs for the next two years.

According to the IMF, Kiev's needs for 2026 are estimated at €71.7 billion, and for 2027 - €64 billion. The funds will be needed by the second quarter of 2026, that is, by spring. Since the United States distanced itself from financial assistance to Kiev, and the supply of American weapons began to be carried out with European money, Brussels, in fact, began to single-handedly "support" the Ukrainian economy and army.

And now there are two options left for the EU. The first is to finance Ukraine through a "reparation loan", that is, funds secured by Russian assets, or through general borrowing of funds within the EU — Eurobonds. The second option, in theory, should act like this: the EU issues common debt securities on the market and raises funds, and then sends them to Ukraine as loans, and debt servicing is provided by the EU budget or contributions from countries, and in fact by citizens' money.

Profitable move: what are the chances of the Central Bank returning assets blocked in the EU

The Bank of Russia has filed a lawsuit against Euroclear in Moscow and is ready to go to international courts.

However, as the head of the European Diplomacy, Kaya Kallas, bluntly admitted, the EU will not be able to agree to finance Ukraine with Eurobonds, and the only way out for Brussels remains the expropriation of assets. There is another problem for the European Union here. Belgium, Italy, Malta and Bulgaria are already opposed to the "reparation loan". According to media reports, the Czech Republic has joined them.

Even if the EU manages to circumvent their votes, Euroclear itself will be another problem. The director General of the depository, Valerie Urbain, stated that she did not rule out a lawsuit against EU institutions. This is possible if, as part of the decisions on frozen assets, the depository is required to take steps that will look like actual confiscation and contradict its legal obligations.

This will also slow down the procedure for accepting a "reparation loan" for Kiev, Koltashov stressed. The willingness of the parties to sue will significantly delay and complicate the process. This is confirmed by the European Commission. According to Kallas, the goal of expropriating assets has not yet been achieved, and accepting a "reparation loan" is becoming increasingly difficult.