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Frozen Russian state assets should be transferred to a new fund to reconstruct Ukraine, says PACE committee

Reconstruct Ukraine

The Council of Europe should lead a process for “the seizure of Russian state assets and their use in support of the reconstruction of Ukraine”, according to PACE’s Political Affairs Committee.

In a draft resolution based on a report by Lulzim Basha (Albania, EPP/CD), the committee said Russia, as the aggressor state, should provide “full compensation for the injury caused by its internationally wrongful acts, including the destruction of infrastructure, loss of life, economic hardship, and other adverse effects”.

Approximately US$300 billion of frozen Russian sovereign assets should now “be put at the disposal of reconstructing Ukraine”, the committee said. By June 2023 the documented damage to Ukraine’s infrastructure and economy caused by Russia’s aggression was estimated to have reached US$416 billion, the parliamentarians pointed out.

The committee recommended the establishment of “an international compensation mechanism” under Council of Europe auspices, comprising an international trust fund into which Russian assets held by Council of Europe member and non-member states should be deposited, and an “impartial and effective” international claims commission, operating under recognised judicial norms, to adjudicate claims presented by Ukraine and other entities affected by the aggression.

The committee urged Council of Europe member and non-member states holding Russian assets to “actively co-operate” in transferring these assets to such a mechanism – with the support of the EU, the US and the G7.

“Under international law, states possess the authority to enact countermeasures against a state that has seriously breached international law. Now is the time for Council of Europe member states to move from sanctions to countermeasures,” the committee said, adding that the legitimacy of such countermeasures remains “unassailable” within the framework of sovereign immunity.

The Council of Europe had already “led the way” in expressing its solidarity with Ukraine and its people, the committee noted, by excluding Russia from its membership, and by setting up a “Register of Damage” to log damage, loss or injury suffered by Ukraine, as a first step towards holding Russia accountable for its “wrongful acts”.

Such steps, the committee concluded, would have the three-fold objective of strengthening Ukraine, ensuring Russia’s accountability and deterring future aggression.

The full Assembly – bringing together parliamentarians from the 46 member states of the Council of Europe – will debate the report in due course.