Germany Eyes Confiscation of Russian Assets Amid Legal Hurdles

Germany, alongside its allies, is considering confiscating frozen Russian assets, subject to legal feasibility, to aid in Ukraine's reconstruction. Following Russia's invasion of Ukraine in 2022, Western nations froze Russian sovereign assets. European leaders are deliberate in their approach to avoid legal challenges and potential financial market risks.

Germany, along with its allies, is contemplating the confiscation of frozen Russian assets if legal pathways allow, as stated by Chancellor Friedrich Merz in a recent interview with Zeit newspaper. This move is amid ongoing discussions on imposing further sanctions against Russia.

The legal ramifications of seizing Russian assets are being thoroughly investigated, as Merz emphasized the importance of a sound legal basis to mitigate risks to the European financial market. Post Russia's 2022 invasion of Ukraine, around $300 billion of Russian sovereign assets were immobilized by Western nations, intending to assist Ukraine's recovery.

Despite European leaders' eagerness to use these assets, they face challenges in sidestepping legal hurdles and setting international precedents. Skepticism persists among Western officials, including those in Germany and the European Central Bank, over the legality and potential negative impact on the euro as a reserve currency.

(With inputs from agencies.)