Putin decree outlines Russian response to any US seizure of frozen assets

By Thomson Reuters May 23, 2024 | 7:32 AM

MOSCOW (Reuters) – Russia will identify U.S. property, including securities, that could be used as compensation for losses sustained as a result of any seizure of frozen Russian assets in the United States, according to a decree signed by President Vladimir Putin on Thursday.

The decree authorises Russia’s government commission on foreign asset sales to identify the relevant property and states that decisions on compensation would be made in court.

G7 negotiators have been discussing for weeks how to best exploit some $300 billion worth of Russian financial assets, such as major currencies and government bonds, which were frozen shortly after Moscow invaded Ukraine in February 2022.

Russia’s ability to mete out like-for-like retaliation if Western leaders seize its frozen assets has been eroded by dwindling foreign investment, but it may go after private investors’ cash instead, officials and economists told Reuters this month.

Thursday’s decree listed securities, real estate, movable property and property rights among the U.S.-owned assets liable for seizure.

Former president Dmitry Medvedev acknowledged last month that Russia holds an insignificant amount of American state property and that any response Russia makes would be asymmetrical, focusing on private individuals’ assets.

The assets of many foreign investors, including both individuals and major U.S. investment funds, are held in special ‘type-C’ accounts Russia introduced shortly after sending its army into Ukraine and being hit by a barrage of Western sanctions in February 2022.

Money in those accounts cannot be transferred out of Russia without permission from Russian authorities.

(Reporting by Reuters; Writing by Alexander Marrow; Editing by Mark Trevelyan)