Euroclear has filed a lawsuit in Brussels to void a Russian arbitration court ruling that ordered it to release nearly $232 billion in blocked Russian assets. The clearinghouse rejects the Moscow court’s jurisdiction and fears the decision could expose its holdings in jurisdictions outside Europe to seizure.
Euroclear has taken the Central Bank of Russia to court in Brussels, seeking to void a Russian arbitration ruling that ordered it to unblock and pay nearly $232 billion in frozen assets to the Russian Federation. The clearinghouse, one of the largest in Europe, wants a swift decision that undermines the Moscow court’s order.
Why Euroclear rejects the Moscow ruling
The Central Bank of Russia had argued that Euroclear’s actions were illegal and blocked its access to funds and securities held in the depository’s custody. Euroclear disputes that, saying the Russian proceedings are not recognized under European Union law and that it does not accept the court’s jurisdiction.
Speaking to French journal L’Echo, Euroclear’s attorneys Dorothée Vermeiren and Nathan Tulkens confirmed the institution was seeking a fast ruling in Brussels. One attorney called the Russian proceedings a travesty of justice, saying: “We now consider this trial in Russia to be a travesty of justice.”
The risk beyond Europe
The real issue sits outside Europe, where Euroclear also operates. The Russian court ruling could put assets under management at risk of seizure if courts in those jurisdictions decide to enforce the Moscow decision.
Central Bank of Russia President Elvira Nabiullina signaled the bank was ready to use every tool available to defend its position, while declining to disclose its tactics. Economist Jim Rickards has warned that a broad seizure of the assets could target Euroclear’s offices in Hong Kong and throw a “monkey wrench” into the global clearance system.
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