Italy, Bulgaria, Malta and Belgium have issued a joint statement expressing reservations about the European Union’s plan to use frozen Russian assets as the basis for a large-scale financial mechanism to support Ukraine. The four countries have aligned themselves with Belgium’s call to explore alternative approaches to the proposed scheme, which is built around roughly €210 billion in Russian sovereign assets held in the EU, equivalent to about 410 billion leva.

Further reading: EU Finally Acts: Russian Assets Locked, Clearing Way for Massive Loan to Ukraine

The coordinated move, reported by Euractiv, risks complicating efforts to secure agreement on the so-called reparations loan at a key EU summit scheduled for next week. While the countries reaffirm their political backing for Ukraine, they stress that the legal and institutional design of the proposed mechanism requires careful reconsideration.

In their joint declaration, Italy, Bulgaria, Malta and Belgium voice support for a European Commission proposal to freeze Russia’s sovereign assets in the EU on an indefinite basis. According to the signatories, this step is necessary to ensure predictability and to avoid the recurring risk linked to the six-month renewal of sanctions, which in the past has depended on unanimous approval from all member states.

At the same time, the four governments caution that an indefinite freeze should not obstruct the possible future use of the funds to support Ukraine, including its military needs. The Commission has argued that making the freeze permanent is essential to prevent potential blockages by Hungary, whose government is seen as sympathetic to Moscow, and to remove the risk of assets being returned to Russia if sanctions are lifted.

A central concern highlighted in the statement relates to the legal basis for the decision. The Commission has relied on Article 122 of the EU treaties, an emergency clause that allows decisions to be taken by qualified majority rather than unanimity. The four countries warn that invoking Article 122 could carry significant legal, financial, procedural and institutional consequences that extend beyond this specific case.

They argue that the decision should not set a broader precedent, particularly in areas such as foreign and security policy, where unanimity among member states has traditionally been required. In their view, bypassing this principle could have long-term implications for how the EU takes sensitive geopolitical decisions.

Belgium’s position is given particular attention. Brussels has repeatedly raised concerns that, if the reparations loan were implemented and sanctions later collapsed due to a political veto, Belgium could face substantial financial exposure. As the host country of Euroclear, which holds a large share of the frozen Russian assets, Belgium fears it could be forced to compensate Russia, potentially involving sums amounting to hundreds of billions of euros.

According to the documents cited, EU representatives are expected to meet on Sunday to continue discussions on the loan, ahead of a European Council meeting next week. During these talks, member states will examine a series of amendments proposed by Belgium to the Commission’s legal framework.

These proposed conditions include demands for independent and autonomous guarantees from EU governments, as well as explicit provisions ensuring that Euroclear cannot be held liable in connection with the reparations loan. The aim is to shield both Belgium and key financial institutions from legal and financial fallout if Russia pursues litigation.

Bulgaria’s Ministry of Foreign Affairs confirmed that Sofia, together with Belgium, Italy and Malta, formally submitted the joint declaration to the EU Council. Quoted by BTA, the ministry said the four countries underlined that any decision on the use of frozen Russian assets must fully comply with both EU law and international legal norms.

The statement emphasises that strict adherence to the legal framework is essential for the legitimacy and long-term sustainability of any measures taken. The signatories also call for continued discussions on alternative forms of predictable and reliable financial support for Ukraine that would reduce legal, institutional and financial risks for member states.

The backdrop to the debate is the EU’s recent decision to freeze Russian assets in Europe indefinitely. This move is intended to ensure that governments in Hungary and Slovakia, both seen as closer to Moscow, cannot block the use of billions of euros to support Ukraine by refusing to extend sanctions in the future.