Russia prepares for court battle over confiscation of frozen assets – Bloomberg

Russia is preparing a lawsuit to thwart any attempts by the US or the EU to confiscate part of the Central Bank's US$300 billion in frozen assets in favour of Ukraine.

Source: Bloomberg, citing sources familiar with the matter

Details: Officials in Moscow who are examining the likelihood of the funds being confiscated believe that such an outcome is unlikely.

According to Bloomberg, the Bank of Russia is currently close to concluding an agreement with international law firms that will represent the Russian Federation in the event of a court case.

Bloomberg's sources said that the Russian authorities have also commissioned expert opinions analysing the relevant foreign legislation and precedents.

The agency reported this week that the Biden administration is backing a bill that would allow the confiscation of some Russian assets. The White House wants to coordinate this move with its G7 allies, especially in Europe, where about two-thirds of Russia's frozen funds are held and where support for confiscation, especially unilateral confiscation, has been "lukewarm".

The Bank of Russia declined to comment on its plans. Asked about the consequences of the West's possible moves, Kremlin spokesman Dmitry Peskov said Russia would challenge them in court, adding that the Kremlin could take retaliatory measures.

"This will entail very serious judicial and legal costs for those who make such decisions," Peskov said.

Russian officials have long spoken of taking the legal route, with Central Bank Governor Elvira Nabiullina saying last July that the Bank of Russia was "almost ready" to challenge the freeze.

In a December interview with RBC, she called it "a very negative signal for all central banks, because it is a violation of the basic principles of reserve security".

Moscow sources are confident that the court case will prevent any transfer of funds to Ukraine, even if Russia fails to regain control of the money.

They believe that the West has little chance in court and has no legal grounds for confiscation under the legislation adopted after the freeze.

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