For more than two years, the Europeans have been wrangling over whether and how to use about $270 billion of frozen Russian funds to help fund Ukraine. They’re still trying to agree on a plan.

Later this month, there’ll be another summit of European leaders to discuss the latest iteration of the numerous schemes the European Union has floated to tap into the Russian central bank reserves that were frozen within days of Russia’s invasion.

Most of those funds – about €190 billion ($336 billion) – are held by the Belgium-based clearing house Euroclear, although there’s about another €20 billion held in banks in France, Switzerland, Germany and Cyprus.

Europe could seize Russia’s frozen assets in the West to help Ukraine defend itself against Vladimir Putin’s aggression.Credit: AP

The funds trapped in Europe represent the vast majority of Russia’s foreign exchange reserves that were frozen by the G-7 countries at the outset of the war, with relatively modest amounts thought to be sitting in United States, Japanese and even Australian accounts.

While it might seem obvious that the funds should be seized and handed over Ukraine to fund the war and repair the extensive damage Russia has done, and is still doing, to its infrastructure, concern that accessing those assets directly would breach international laws prohibiting expropriation of foreign private property without fair compensation has stopped the EU from acting.

There are also fears that Russia would litigate and that the precedent of forced seizure of a foreign government’s assets would undermine trust and deter future investment in Europe.

There would be some justice in using Russia’s own funds to strengthen Ukraine’s capabilities and its ability to threaten to prolong the war and increase the pressure on Russia’s stretched economy.

Instead, the EU has been using some of the interest being generated by........

© The Sydney Morning Herald