As Russia’s unlawful war of aggression continues to inflict untold devastation on Ukraine and its people, policymakers have begun to search for ways to support Ukraine’s beleaguered economy and fund its eventual reconstruction. Their attention has increasingly turned to the billions of dollars in assets that countries have frozen as part of the unprecedented array of sanctions imposed by the United States and its allies. The largest tranche of these frozen Russia-related assets—estimated atalmost $300 billion—consists of foreign exchange reserves owned by Russia’s central bank, including at least $38 billion in the United States. Substantial assets also belong to other Russian government agencies, state-owned enterprises, and private corporations and individuals that have been sanctioned as a result of Russia’s actions.
Senior U.S. officials have expressed an interest in making some or all of these assets available to Ukraine, and numerous observers have putforwardproposals for doing so over the past several weeks. Some have focused on Russian central bank assets while others have sought to include the assets of other Russian entities and nationals as well. But as Paul Stephan has explained in a useful set of exchanges with Philip Zelikow and Laurence Tribe here on Lawfare, these proposals do not always take full account of the unprecedented nature of what they are proposing or the domestic and international legal questions such actions raise. And the United States ignores these questions at its own peril. The domestic and international legal protections that the United States generally extends to foreign assets—and especially foreign state and central bank assets—are a major contributor to the central role that the United States plays in the global economy. Compromising them may not only injure the U.S. economy but also limit the economic tools, such as economic sanctions, that the United States has available to it in the future.
In this post, we provide a road map to the core legal issues that U.S. policymakers need to consider as they weigh whether and how to move forward with seizing any frozen Russia-related assets. These include whether there is existing legal authority for seizure, what constraints the Constitution puts on Congress’s ability to authorize seizure, and whether seizure will put the United States in violation of international law. While there may yet be a role for seizing assets, such measures would implicate an array of long-standing legal and related policy equities that may be particularly important in the face of increased geostrategic competition and a flagging global economy. For this reason, any such proposal warrants careful examination.