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(Bloomberg) — The European Union is exploring more aggressively ways to seize Russia’s frozen central bank assets as the bloc scrambles to ensure financial and military support for Ukraine amid indications the US may pare back its own assistance. 

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EU officials are discussing how the assets could be used as collateral by a planned International Claims Commission, which will determine compensation owed to Ukraine, according to people familiar with the talks. The assets could then be seized if Moscow refuses to pay the damages.

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The value of the confiscated assets would be offset by Russia’s obligations to pay for damages in a potential peace deal, said the people, who spoke on the condition of anonymity.

US President Donald Trump has turned sharply against President Volodymyr Zelenskiy in recent days, calling him an unelected dictator and blaming Ukraine for Russia’s invasion. Zelenskiy has urged European leaders to step up help for his country amid threats that the US, which has been one of Kyiv’s chief suppliers of weapons and financial aid, would decrease its involvement.   

The EU, Group of Seven countries and Australia have frozen about $280 billion of Russian central bank assets in the form of securities and cash, mostly through the Belgium-based clearing house Euroclear. Sanctions imposed on prominent Russian individuals froze an additional estimated $58 billion in assets, including homes, yachts and private aircraft, according to US Treasury estimates. 

The European Commission, the EU’s executive arm, didn’t immediately respond to a request for comment. 

The EU’s economy and financial services chiefs Valdis Dombrovskis and Maria Luís Albuquerque, have said that the bloc should explore every possible option to help Ukraine, including the confiscation of Russian central bank assets. 

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Another option being discussed would entail the EU mandating member states to confiscate the sovereign assets to compensate for the destruction of Ukraine’s energy infrastructure, according to the people. They’re looking into whether a ruling on this by the International Criminal Court and the brutality of the attacks would justify the action under member states’ criminal laws.

Proposals to fully seize the assets have been opposed by member states including Germany and France due to the legal and economic consequences that could result as well as how such a dramatic action could affect the international role of the euro. 

The EU’s diplomatic service as well as some member states have examined whether judicial decisions would be needed as a legal basis to seize the frozen assets, or if a damage calculation would be enough, Bloomberg reported earlier. The European Central Bank has also expressed concerns about the idea.

Complicating the proposals, the G-7 has already used the profits generated by the immobilized Russian assets to back a $50 billion loan to Ukraine. 

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The European Commission, the bloc’s executive arm, informed EU ambassadors this week that negotiations to establish the International Claims Commission would start March 24, the people said. It added that the new organization would be discussed during a meeting of foreign ministers on Monday. 

The new commission’s job will be to assess damage claims and estimate a precise amount that should be paid out. 

“There can also be no justice without compensation,” European Commission president Ursula von der Leyen said this month when the institution took initial steps to set up the International Claims Commission. 

“Russia must be held accountable for its aggression – and it must pay,” she said. 

—With assistance from Alberto Nardelli and Andrea Palasciano.

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