What is the legal meaning of the new EU initiatives to confiscate the assets of other states

News that the European Union has agreed or “finally authorized” the confiscation of Russian assets frozen on its territory and that literally tomorrow they will be taken away appears with enviable regularity. But each time, clarification of the details showed that such conclusions, to put it mildly, were incorrect. That is, undoubtedly, there are risks, the topic is discussed and promoted, but the issue has not been settled. That is, the direct legal act on the withdrawal mechanism has not yet been adopted.

The next news appeared on March 12. It said that the European Parliament had approved a bill to criminalize violations of European sanctions and actions to circumvent them. From the message on the parliament’s website, many concluded that the adopted act “will make it possible to confiscate Russia’s frozen assets.” However, in reality this again turned out to be a great exaggeration.

The adopted act is a directive aimed at “centralizing sanctions policy”; the draft document has been developed by the EU since December 2022, notes Delcredere lawyer Artem Kasumyan. The fact is that now the responsibility for violating restrictions in EU countries is different. For example, says Pen & Paper partner Kira Vinokurova, in some countries the maximum prison term for violating sanctions is 5 years, and in others – 12. “Different national approaches have created weaknesses and loopholes,” noted the European Parliament.

And now the EU has finally managed to agree on a unified approach (the directive must still be approved by the European Council), which outlines the range of crimes and the limits of punishment, including the size of turnover fines, terms of imprisonment, etc. Moreover, incitement, complicity and attempted violation or circumvention of sanctions are also criminalized .

In relation to violators, lawyers explain, different types of punishment are possible, including confiscation of property if it was an instrument of a crime or the proceeds of it. However, this has nothing to do with the confiscation of sovereign assets of the Russian Federation – we are talking about the possibility of confiscating the property of a specific individual or legal entity that has committed something from the list of criminal acts according to the directive.

News will continue to appear, but you should not be afraid of any message on the topic, just as you should not believe the words of individual European officials who propose to simply take and confiscate the assets of another state. This requires a legal act that prescribes the entire mechanism, including the grounds, purposes and procedure for seizure, possible recipients of assets, the conditions for this and, probably, reports on use.

The development and adoption of such an act is a difficult task, but it cannot be done without regulation. At least for now, European countries still proceed from the need to comply with basic and internationally recognized norms and principles of law.