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Wider Europe Briefing: A Key European Summit In Moldova; And Why It's So Hard To Seize Russian Assets

Leaders pose for a group photo during the first meeting of the European Political Community in Prague on October 6, 2022.
Leaders pose for a group photo during the first meeting of the European Political Community in Prague on October 6, 2022.

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods. To subscribe, click here.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two major issues: the upcoming European Political Community summit in Moldova and the difficulties facing the EU in seizing or using Russian frozen assets.

Brief #1: What To Expect When European Leaders Descend On Moldova This Week

What You Need To Know: On June 1, the leaders of the EU's 27 member states and their counterparts from 20 other European countries gather at the private Mimi Castle and winery some 30 kilometers outside the Moldovan capital, Chisinau, for the second summit of the European Political Community (EPC). The EPC, a brainchild of French President Emmanuel Macron, was launched last year following Russia's invasion of Ukraine as an intergovernmental forum for political discussions on the future of Europe.

At its inaugural summit in Prague in October 2022, Macron referred to the meeting as "an opportunity to build a strategic intimacy in Europe." He was also quick to dismiss the notion that it was some sort of substitute for EU membership, calming the nerves of leaders in the Western Balkans and the EU's Eastern neighborhood.

Still, a more impertinent description of the whole event is "yet another European talking shop," not too dissimilar from, say, the Council of Europe. So, don’t expect the EPC to morph into an organization with a budget, secretariat, flag, or anthem.

Deep Background: Despite being short on outcomes so far, feedback from leaders after the Prague meeting suggested they liked the idea of a forum that provided a "looser setting" where they could chitchat and not be bound by the kind of structures and strict speaking times that are imposed by other, more formal political organizations.

The Chisinau meeting is scheduled to last a little over five hours, with a short opening ceremony followed by four roundtables dealing with topics such as energy, security, connectivity, and mobility. After a working lunch, the biggest chunk of the agenda is meant for various bilateral meetings -- possibly the most interesting aspect of the day, even though the intimate setting, with few diplomats present, will make it difficult for media to tease out whether any breakthroughs or breakdowns occurred.

There will also be a family photo, which might be the most interesting aspect for posterity. Three European microstates -- Andorra, Monaco, and San Marino -- have joined the EPC since the Prague meeting, so the only European countries without a representative in Chisinau, apart from the Vatican, are Belarus and Russia. That is telling.

And it sure looks like the EPC is here for the foreseeable future. A summit is already planned for the Spanish city of Granada in early October, and then another for the United Kingdom in the first half of 2024, with the hosts rotating every six months between EU and non-EU countries.

Drilling Down

  • Perhaps the most interesting meeting could be on the summit's sidelines between Armenian Prime Minister Nikol Pashinian and Azerbaijani President Ilham Aliyev. They met in Brussels in May under the auspices of European Council President Charles Michel in search of a comprehensive peace agreement between Yerevan and Baku over the breakaway region of Nagorno-Karabakh. While the meeting lasted four hours, there were no specific achievements apart from the understanding that they should meet as often as necessary.
  • The same trio is likely to be flanked by Macron and German Chancellor Olaf Scholz in Chisinau in what can only be interpreted as a clear European push to play a bigger role in settlement efforts in which Moscow has so far seemingly called many of the shots. Because Paris is often accused of being too close to Yerevan, there has been a conscious push by Brussels to include Berlin in order to ensure more balance in the talks. Senior EU officials speaking on the condition of anonymity continue to stress that the added advantage of Brussels becoming more engaged on this issue is that "the EU has no hidden agenda here" and is willing to grant time and a platform to facilitate talks for as long as it takes.
  • The expected Aliyev-Pashinian meeting comes just a week after Russian President Vladimir Putin hosted them in Moscow -- a gathering that concluded with the two leaders verbally sparring in front of the assembled media.
  • But don't expect a breakthrough in Chisinau, as more meetings are scheduled in the next few months: in Brussels again in July with just Michel; and then possibly at the next EPC summit in Granada. But gestures related to the Karabakh conflict, such as the release of detainees, demining initiatives, or the unblocking of transport links could be in the cards. There could also be a larger role for the EU monitoring mission in Armenia that was set up earlier this year with the aim of contributing to stability at the border between Armenia and Azerbaijan. The Europeans will also look to get some sort of assurances from Baku regarding the rights and security of ethnic Armenians living in Nagorno-Karabakh. For months, Azerbaijan has been blockading a key road that connects Yerevan to Nagorno-Karabakh.
  • On other matters, are there likely to be any concrete deliverables at the summit? Don't rule out something more tangible on, for example, the strengthening of Solidarity Lanes with Ukraine, a commitment on reducing or eliminating roaming costs, or the possibility of increasing exchanges of diplomats and civil servants among countries.
  • A discussion paper written ahead of a security roundtable at the summit, which will be co-chaired by Poland and the United Kingdom, includes a focus on boosting cybersecurity. The text, seen by RFE/RL, notes that "Russian aggression against Ukraine is taking place in cyberspace in a form of incidents and malicious cyberactivities conducted by state-sponsored groups as well as by cybercriminals." It also suggests that more should be done to boost resilience to cyberattacks in countries neighboring Russia and in the Western Balkans.
  • The document also talks of more financial support to the International Atomic Energy Agency (IAEA) in order to safeguard the Ukrainian nuclear power plant at Zaporizhzhya and the need for governments and civil society "to identify societal weaknesses which are targeted to facilitate information operations by malign actors, and which polarize and destabilize communities, e.g. ethnic minorities or marginalized communities, migrants, gender/sexual issues, and political/democratic processes and participation."
  • The summit will doubtless shine a spotlight on Moldova and its president, Maia Sandu, in what is the biggest political gathering in the country's history. In its run-up, the EU has already agreed to set up a civilian mission there to counter hybrid threats as well as to impose sanctions on two Moldovans accused of undermining the territorial integrity of Ukraine, and five more, including oligarchs Vladimir Plahotniuc and Ilan Shor, for allegedly destabilizing Moldova.
  • Beyond Sandu's big moment, there will be other leaders vying for attention. If Ukrainian President Volodymyr Zelenskiy shows up (he was absent at the Prague summit), he is likely to dominate the headlines. Meanwhile, there was no indication yet of whether Turkish President Recep Tayyip Erdogan will be ready to travel so soon after securing another five-year term in a May 28 presidential runoff.

Brief #2: The Long Road To Seizing Frozen Russian Assets

What You Need To Know: One widely discussed aspect of the war in Ukraine is how to finance the reconstruction of the country once the fighting ends. It is estimated by both the United Nations and the European Union that Kyiv needs over $400 billion in the next decade to rebuild its economy, a figure that will rise as the war grinds on. While Western partners are almost certain to provide economic aid for the foreseeable future via loans, grants, and investment in infrastructure, there is a growing sense that Russia must foot some of the bill.

In the final statement from the G7 summit in Hiroshima on May 19-21, the leaders of the seven leading Western economies concluded that "we will continue to take measures available within our domestic frameworks to find, restrain, freeze, seize, and, where appropriate, confiscate or forfeit the assets of those individuals and entities that have been sanctioned in connection with Russia's aggression."

The leaders added that "we reaffirm that, consistent with our respective legal systems, Russia's sovereign assets in our jurisdictions will remain immobilized until Russia pays for the damage it has caused to Ukraine."

The big question is how likely this might be achieved.

There are several avenues to using frozen Russian cash for the reconstruction, but all of them are complicated. To keep such assets in the West frozen until Russian repayment, as the G7 statement alluded to, is a long game. It also risks backfiring if governments, notably within the EU, were to stray from the unanimity that is required every six months to roll over sanctions on Russia.

The question then becomes whether it's possible to use some of the frozen wealth right away, either by confiscating assets held by individuals who have been targeted by the EU or by actively investing some of the Russian state reserves that EU member states are holding, many in the form of sovereign bonds.

Deep Background: In the EU, it is the European Commission that oversees actions regarding frozen Russian assets within the bloc. Already in March 2022, it created a Freeze And Seize Task Force tasked mainly with ensuring that all member states implement the bloc's (by now 10) packages of Russia sanctions but also increasingly to explore the legal options on the use of seized Russian assets.

In November 2022 and in March, the European Commission sent out discussion papers to member states detailing the options. Seen by RFE/RL, the papers paint a rather pessimistic picture of what is legally possible and how much Russian money the EU can realistically channel for future Ukrainian rebuilding.

The EU has so far frozen an estimated 20 billion euros ($21.4 billion) worth of assets belonging to the 1,500-plus people so far sanctioned for undermining Ukraine's territorial integrity. But the chances are small that this money can be used in any way. EU legislation stipulates that the freezing of assets alone cannot be considered a first step toward confiscation. It is considered private property and, as such, requires compensation in the event of deprivation.

Drilling Down

  • One of the European Commission papers on the confiscation issue notes that previous rulings by the European Court of Justice (ECJ) suggest that sanctions like asset freezes are "of temporary and nonpunitive nature." In other words, by that reading, it's clearly a restriction but cannot be seen as a criminal punishment. It simply concludes that "from both legal and sanctions policy perspectives, it is important to preserve the temporary and noncriminal nature of sanctions to avoid raising the procedural and evidentiary thresholds required for the adoption of sanctions in the first place."
  • There is an argument that the only way money can be confiscated is if the individual possessing the frozen assets is convicted of a criminal offense. This is a long and arduous process but something that the EU and its member states are looking into. The European Commission has already asked Eurojust and Europol, the EU's two agencies for criminal justice and law enforcement cooperation, to cross-check the list of sanctioned individuals against their databases; they identified criminal links relating to 71 individuals and three sanctioned companies.
  • Another possibility is to legally consider some Russian entities such as companies or organizations criminal or terrorist organizations and therefore regard individuals as criminally liable for their association. That could facilitate confiscation, but in order for that to happen, national or EU laws must be rewritten to include such a possibility. Consensus among the 27 EU member states is needed for that and, so far, that has not been possible.
  • The most likely option right now might be the "active management" of frozen Russian state assets belonging to the Russian Central Bank and affiliated entities. It is estimated that some $300 billion is frozen worldwide, with up to two-thirds of that in the EU.
  • But even if all the legal hurdles are cleared, not all the assets would be available. Firstly, under international law, rules on state immunity would have to be assessed. That would likely cover Russian Central Bank assets that are necessary for sovereign functions like monetary policy, although it is unclear if international immunity would extend to assets used for commercial purposes.
  • What the EU is therefore examining is potentially selling Russian sovereign bonds on the market and handing over the proceeds to Ukraine. Legal changes would be required, but it's unclear whether it would be worth it. The European Commission calculated that annual revenues of around 2.6 percent could be generated by selling short-term bonds. That could provide several billion dollars to Ukraine, but no more.
  • Discussions have been held among representatives of various EU member states, but there appears to be some reluctance on their part. The EU doesn't want to go it alone; it would prefer that the United States do the same in order to alleviate fears among other central banks around the world that their dollar or euro reserves in the West are not safe from confiscation.

Looking Ahead

On May 29, the annual Globsec Bratislava forum kicks off in the Slovak capital. It is arguably the biggest think-tank event in Central and Eastern Europe, with leaders including French President Macron debating the latest developments in Europe and beyond for a full three days. I will be there to moderate panels on the future of both EU defense policy and the European neighborhood. Feel free to come and say hello or catch up over a coffee in Bratislava. I'll be writing about the forum in the next edition of the Wider Europe newsletter on June 5.

That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak or on e-mail at

Until next time,

Rikard Jozwiak

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    Rikard Jozwiak

    Rikard Jozwiak is the Europe editor for RFE/RL in Prague, focusing on coverage of the European Union and NATO. He previously worked as RFE/RL’s Brussels correspondent, covering numerous international summits, European elections, and international court rulings. He has reported from most European capitals, as well as Central Asia.

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About The Newsletter

Wider Europe

The Wider Europe newsletter briefs you every Monday on key issues concerning the EU, NATO, and other institutions’ relationships with the Western Balkans and Europe’s Eastern neighborhoods.

For more than a decade as a correspondent in Brussels, Rikard Jozwiak covered all the major events and crises related to the EU’s neighborhood and how various Western institutions reacted to them -- the war in Georgia, the annexation of Crimea, Russia’s support for separatists in eastern Ukraine, the downing of MH17, dialogue between Serbia and Kosovo, the EU and NATO enlargement processes in the Western Balkans, as well as visa liberalizations, free-trade deals, and countless summits.

Now out of the “Brussels bubble,” but still looking in -- this time from the heart of Europe, in Prague -- he continues to focus on the countries where Brussels holds huge sway, but also faces serious competition from other players, such as Russia and, increasingly, China.

To subscribe, click here.