The UK has introduced legislation that would allow for the retention and liquidation of confiscated frozen Russian assets, setting a precedent among Western countries, British media reported on Monday.
The new law will allow the British government to keep its sanctions in place until compensation is paid to Ukraine, thus introducing a way for seized Russian money to be handed over to Kiev.
According to media reports, the law will ensure that frozen assets belonging to the Russian state and individuals can be seized, making the UK the first European government to take such a step.
“Through our new measures today, we’re strengthening the UK’s sanctions approach, affirming that the UK is prepared to use sanctions to ensure Russia pays to repair the country,” British foreign minister James Cleverly said.
Many Western governments, including Switzerland have so far refrained from confiscation of Russian funds despite increasing pressure from the US and the EU. There is fear that it would set a precedent for Western assets held overseas to also be seized and thus jeopardize investor confidence in the European banking system.
All the while Brussels and its allies have been looking into methods of confiscating Russian assets, with the Council of Europe establishing a digital register of damage in Ukraine – a move that has been described as the first step towards creating an “international compensation mechanism.”
New measures will also oblige any individual who has been designated under the sanctions to disclose all assets held in Britain. Failure to comply with the requirement will reportedly lead to a fine or a seizure of funds.
Britain has frozen £26 billion ($32.1 billion) in assets and reserves belonging to the Russian state since the beginning of the conflict in Ukraine, according to the Bank of Russia.
In total, Western governments have reportedly frozen about $300 billion in Russian central bank assets since the start of Moscow’s military operation in Ukraine, and seized more than $80 billion worth of assets belonging to Russian citizens and businesses.
Russian President Vladimir Putin described these actions as “medieval,” while the Kremlin has repeatedly warned that Russia will respond in kind if necessary.