Seizing Russia’s Frozen Assets: Quis iudicabit?

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As 2024 begins, negotiations on further financial assistance to Ukraine have stalled on both sides of the Atlantic. As a consequence, Western policymakers now increasingly consider confiscating Russia’s frozen assets as a possibility to circumvent the political deadlocks that are blocking further financial aid. Russia, on its part, has already threatened Ukraine’s supporters with retaliation in kind if they should proceed to confiscate its assets.

But are there other options for Russia to fight a confiscation of its foreign assets? Could it bring a case before an international court or tribunal, maybe even before the International Court of Justice (ICJ)? The Russian government already indicated a willingness to take legal action against the freeze imposed on its assets. While such claims haven’t materialized yet, the West proceeding from freezing to seizing might well push Russia over the edge and give rise to litigation or arbitration over the fate of the approximately $350 billion in Russian state-owned assets currently frozen. 

This post will determine which international legal fora would be competent to adjudicate Russian claims for a possible confiscation of its foreign assets, which of them are most likely to be chosen by Russia, and what obstacles and risks Russia would be facing if it decided to sue.

The applicable rules of international law

First, it is necessary to briefly survey the legal landscape: Most scholarly contributions published since the beginning of Russia’s war of aggression have focused on state immunity as a potential bar to confiscating Russia’s assets (see here and here). Others have also brought up the customary prohibition of expropriating foreigners without compensation as well as international investment law. Additionally, the human right to property, enshrined in Article 1 of Protocol No. 1 to the European Convention on Human Rights (ECHR), might offer protection to the assets of Russia’s state-owned entities.

Since this post is only concerned with questions of dispute settlement, no definitive opinion on the legality of confiscating Russian assets under these rules needs to be expressed. For the moment, it suffices to understand that they constitute the most natural legal bases for a Russian case.


Let’s start with the big one: Is there any chance that a Case concerning confiscated Russian Assets will be part of the ICJ docket soon?

The thought of Russia lodging an application with the ICJ might appear outlandish at first, given the disregard for the Court Russia has displayed by ignoring the Provisional Measures Order that required it to cease its assault on Ukraine. But Russia would not be the first state to utilize the ICJ for protecting its foreign assets despite having failed to obey the Court in the past: Last year, after securing a partial victory in the Certain Iranian Assets case against the US, Russia’s ally Iran brought another case before the ICJ, this time against Canada. The Iranian application alleges that Canada violated the international law on state immunity by, inter alia, enabling victims of acts of terrorism purportedly sponsored by Iran to enforce judgments against Iranian state-owned assets located in Canada. Iran’s previous refusal to comply with the ICJ’s judgment in the famous Teheran Hostage case apparently hasn’t lowered its appetite to appeal to the Court whenever it sees fit.

The ICJ, unlike many other international courts or arbitral tribunals, is not limited to adjudicating violations of specific legal instruments like the ECHR, or an investment treaty. Its jurisdiction is only limited by consent. Thus, Russia might be able to have potential violations of all legal rules mentioned above adjudicated in a single case. The only requirement would be a consensual title granting the ICJ jurisdiction over the respective claims.

The Optional Clause system

Since any state planning to seize Russian assets would be unlikely to conclude a special agreement with Russia, and Russia is not party to any general jurisdictional convention like the General Act of 1928 or the European Convention for the Peaceful Settlement of Disputes of 1961, the only available title would be Article 36(2) of the ICJ Statute – the Optional Clause. While Russia has not yet filed a declaration accepting the Court’s compulsory jurisdiction, it would be free to do so at any time.

Under the reciprocity principle underlying the Optional Clause, another state would need to have accepted the compulsory jurisdiction of the Court too for Russia to sue it. While the US withdrew its Optional Clause declaration after the first Nicaragua judgment, Canada and several of Ukraine’s European supporters, such as the UK, Germany and Belgium, still participate in the Optional Clause system. Notably, the lion’s share of about $200 billion in frozen Russian assets is located in Belgium, which is the seat of leading central securities depository Euroclear.

Of course, a Russian Optional Clause declaration would ring alarm bells in the West. States planning to confiscate Russian assets would either withdraw their own declarations or amend them to explicitly exclude disputes related to the seizure of foreign state-owned assets. To prevent this, Russia could file its application(s) immediately after submitting the declaration, leaving the respondents no time to react. This is precisely what Iran did when it filed the application against Canada a mere day after depositing its Optional Clause declaration.

There are, however, three major problems rendering it unlikely that Russia will join the Optional Clause system to contest a confiscation of its assets: 

Problem 1: Anti-Ambush Reservations

First, Iran was not the first state that resorted to the trick of lodging an application right after accepting the Court’s compulsory jurisdiction, and after Portugal had used it against India in the Right of Passage case, most states became aware of the risk. They began to add so-called “Anti-Ambush Reservations” to their Optional Clause declarations (Distefano and Heche, Optional Clause Declarations, MPEPIL 2018, para. 11). Such reservations exclude from the declarant states’ consent to jurisdiction all cases brought within a certain period (usually 12 months) after the applicant submitted its own Optional Clause declaration. The reservation thus buys the declarant state time to amend or withdraw its declaration and thereby to prevent being sued over a matter it would rather not have adjudicated by the ICJ.

The German and British declarations contain Anti-Ambush Reservations. Canada, apparently in reaction to the new Iranian application, has now also added one to its declaration. Belgium’s declaration, on the other hand, does not include an Anti-Ambush Reservation, leaving it prone to Russian applications. 

Russia could thus pick Belgium as the holder of the largest amount of its frozen assets and make it an example. The fact that a judgment against Belgium would indirectly find all other states proceeding to confiscate Russian assets for Ukraine to have acted in violation of international law as well would not hinder the ICJ from exercising jurisdiction since the Monetary Gold doctrine does not apply in such cases (ICJ, Nauru Phosphates, para. 55).

Problem 2: Retaliatory Applications

Russia accepting the Court’s compulsory jurisdiction would of course expose it to “retaliatory applications”, as I shall refer to them, aiming to invoke Russia’s responsibility for the countless violations of the prohibition of the use of force, IHL, as well as human rights law it has committed and keeps committing in Ukraine. Obtaining a judgment that declares Western asset seizures illegal while simultaneously being held accountable for breaches of numerous jus cogens and erga omnes rules of international law obviously is not in Russia’s interest.

Here, Russia could again follow the Iranian playbook by filing an extremely narrow declaration that only covers the exact sorts of disputes it wants to have adjudicated. Iran limited its declaration to questions of state immunity; Russia could add the customary law on expropriations, investment law and the human right to property.

But even if Russia were to file a tailor-made declaration corresponding exactly to the sort of cases it wants to bring before the ICJ, it might still be hit by retaliatory applications: An Optional Clause declaration covering the abovementioned property-related legal rules would open the doors of the Peace Palace for the home states of foreign companies whose assets Russia has snatched in response to Western sanctions.

Further, Russia in 2015 enacted the Federal Law on Jurisdictional Immunity, a statute withholding state immunity in Russian courts from all states that allow suits or executions of judgments against Russia before their own courts (for an analysis see Longobardo, 32 EJIL, 466). States that have been sued before Russian courts under this statute could use a Russian Optional Clause declaration specifically covering state immunity to bring their own cases against Russia before the ICJ.

Problem 3: Countermeasures

Lastly, even a tailor-made Russian Optional Clause declaration excluding all of its actions related to the war would not hinder the Court to assess their legality incidentally, when determining whether asset seizures are justified as countermeasures (see ICJ, ICAO Appeal (Bahrain and others v. Qatar), para. 49). While invoking countermeasures as a justification for confiscating Russia’s assets raises several complicated legal questions itself (among them the problem of third-party countermeasures), Russia would still be at risk of being held accountable for its atrocities, albeit indirectly.

While Iran has taken a similar risk when joining the Optional Clause system to sue Canada, things are more difficult for Russia: Canada would need to prove that Iran in fact sponsored acts of terrorism to succeed with a countermeasures defense. To realize how hard it can be to prove a state’s involvement in such covert operations, one only needs to look at the Oil Platforms case, where the US was unable to convince the Court of Iran’s responsibility for attacks on American vessels in the Persian Gulf (see paras. 43-72 of the merits judgment from that case). Russia’s authorship of numerous violations of international law in Ukraine, on the other hand, would be easy to establish. Russia’s abandonment of covert operations in favor of open warfare in Ukraine in 2022 might thus become a decisive factor.

Any attempt to use the ICJ to fight confiscations of its foreign assets would therefore require Russia’s willingness to have its own actions in Ukraine adjudicated, making it highly unlikely to happen. But the ICJ is, of course, not the only permanent international court.

The European Court of Human Rights (ECtHR)

The ECtHR is the competent tribunal to adjudicate violations of the human right to property under Article 1 of the Protocol No. 1 to the ECHR (see above). While Russia lost its right to file Inter-State cases under Article 33 ECHR when leaving the Convention, this would not prevent the vehicles it uses to hold and manage its foreign assets, like the Russian Central Bank (RCB), or state-owned enterprises Gazprom and Rosneft, to lodge individual applications under Article 34 ECHR. Indeed, there have been attempts by state-owned financial institutions to invoke the conventional human right to property against other states in the past.

For this to work, the complaining Russian institution or company would need to constitute a “non-governmental organization” under Article 34. The ECtHR held that even wholly state-owned legal persons can qualify as “non-governmental” if they satisfy certain criteria, including functional and institutional independence. Given that independence is a fundamental tenet of modern central banking, it appears at least possible that the ECtHR would find the RCB to be non-governmental under Article 34 ECHR. For Gazprom and Rosneft, this should even be relatively easy to establish in the light of the relevant case law.

From a Russian perspective, there are notable advantages of the ECtHR in comparison to the ICJ: As Russia would not need to rejoin the ECHR for the RCB and co. to file individual applications, there is no risk of retaliatory applications against Russia. Moreover, since the merits of such cases would exclusively concern human rights, which, under Article 50 of the Articles on State Responsibility, are not subject to countermeasures, there is less risk that Russia’s actions in Ukraine will be adjudicated indirectly by the ECtHR.

Under Article 35(1) ECHR, available local remedies would of course need to be exhausted before the ECtHR can hear a case. This would force the RCB and Russia’s other investment vehicles to complete a – presumably lengthy – march through the domestic judicial system of any state they wish to sue.

Arbitral Tribunals

Bringing the confiscation of its foreign assets before an arbitral tribunal constituted under a Bilateral Investment Treaty (BIT), on the other hand, would allow Russia to bypass local remedies. Russia has concluded BITs with several European states that support Ukraine, and effective enforceability of the awards rendered by such tribunals is another strong argument for arbitration.

Tribunals have mostly adopted a permissive approach with respect to investment claims by state-owned legal persons. In one of the many arbitrations conducted under the Russia-Ukraine BIT, the tribunal even found Russia’s state development bank VEB.RF – wholly state-owned and entrusted with certain public functions by statute – to qualify for protection under the treaty. The bar that Russia’s corporate vehicles would need to overcome to bring a claim under a BIT therefore seems to be lower than the one posed by Article 34 ECHR.

Further, since Russia’s investment treaties with Belgium, Germany, the UK, Canada, and France all provide for arbitration under either the SCC or UNCITRAL rules, the ICSID Convention’s restrictions on claims by state-owned entities would not come into play. The only state supporting Ukraine that houses a relevant amount of Russian assets and has a BIT with Russia that provides for ICSID arbitration is Japan, and even here, UNCITRAL is an alternative option.

Downsides for Russia would include the lack of symbolic force of an arbitral award in comparison to a judgment by the ICJ or ECtHR. Further, the question whether standards of protection contained in investment treaties are subject to countermeasures is heavily disputed. Depending on the stance taken by the respective tribunal, Russia could thus face indirect adjudication of its actions in Ukraine, just as it likely would before the ICJ.


A Russian Optional Clause declaration, no matter how narrowly tailored, would face multiple obstacles, and put Russia at risk of being held accountable for its numerous violations of international law. It is therefore unlikely that Russia will follow in Iran’s footsteps by bringing a confiscation of its foreign assets before the ICJ. The ECtHR and several arbitral tribunals, on the other hand, might soon find themselves in the position to decide on the legality of confiscating Russia’s assets under human rights law and international investment law.

Of course, the mere fact that there are international fora competent to adjudicate such claims does not mean that Russia and its corporate vehicles will prevail. There are forceful arguments for the position that confiscating and transferring Russia’s assets to Ukraine would be entirely legal. While the outcome of these potential cases might thus be hard to predict, it appears highly likely that, if plans to confiscate its assets move ahead, Russia will have its day in court – the one way or the other.

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Aleksandra Mezykowska says

February 8, 2024

Thank you very much for the interesting post. However, it seems to me that the case law of the ECtHR does not allow formulating a conclusion that RCB can be qualified as “non-governmental organisation” under Article 34, on the contrary it is a governmental institution that is not eligible to lodging a complaint. The Court clearly differentiates between different kinds of wholly state-owned legal persons/institutions/companies. On the one hand, it is true that some of them can be qualified as “non-governmental” if they satisfy certain criteria, including functional and institutional independence (like e.g. the national radio broadcasters mentioned in the post). On the other hand, the Court's assessment of the position of state-owned banks in the light of Article 34 was different. In the case Ljubljanska Banka D.D. v. Croatia the Court adjudicated “that although the applicant bank is a separate legal entity, it does not enjoy sufficient institutional and operational independence from the State and must, for the purposes of Article 34 of the Convention, be regarded as a governmental organisation (see Zastava It Turs, loc. cit.). It thus has no standing to lodge an individual application with the Court.”
In view of the above, it is my opinion that the Court will most likely reject the RCB’ application concerning the confiscation of its assets due to the lack of legal standing under the Convention (my comment applies only to RCB, not companies such as Rosneft and Gazprom).