Russia’s Central Bank building, Moscow, Russia, 28 June 2022. Photo: EPA / YURY KOCHETKOV
American investment fund Noble Capital RSD has filed a lawsuit in a US federal court against Russia, its Finance Ministry, Central Bank and Sovereign Wealth Fund, to demand repayment on a bond issued by the Russian Empire in 1916, state-affiliated business news outlet RBC reported on Thursday.
Noble Capital RSD claims the debt, now worth $225 billion, can be repaid using Russian assets that were frozen between 2014, when international sanctions were imposed on Russia after it annexed the Crimean Peninsula and occupied parts of Donbas from Ukraine, and 2022, when Moscow launched its full-scale invasion of the country.
Experts who spoke to RBC said that they believed the lawsuit was an attempt to “direct the US authorities towards a private legal alternative” regarding the frozen assets, rather than other recent attempts to confiscate them and hand the value to Ukraine. The same experts told RBC that they believed the chances of Russia repaying the debt was extremely low.
In December, European leaders failed to reach a deal on using the same frozen Russian assets, the vast majority of which are held in Europe, to fund a loan to Ukraine to cover its “pressing financial needs” for the next two years. This was due primarily to opposition from Belgium, which holds some €185 billion of the funds and fears retaliation from Moscow should the funds be allocated to Kyiv.
Earlier last month, Russia’s Central Bank announced it would file a lawsuit against Belgian securities depository Euroclear, which holds the bulk of the frozen Russian assets. For now, the Russian assets will remain frozen indefinitely, though the EU has reserved its right to use them to repay a loan it made to Ukraine using its own funds last month.
