The Legal Distinction Between Freezing and Seizure
When Western nations imposed sanctions on Russia following its invasion of Ukraine, they froze hundreds of billions of dollars in assets belonging to the Russian state, banks, companies, and individuals. However, the crucial distinction between freezing assets (temporarily restricting access) and seizing them (permanently confiscating ownership) has created significant legal challenges that undermine the effectiveness of the sanctions regime. This distinction also raises fundamental questions about whether EU sanctions Russia policies can achieve their strategic objectives while respecting rule-of-law principles.
According to a Politico report, the UK has frozen approximately £18 billion worth of individual Russian assets, alongside around £26 billion worth of Russian central bank assets. The European Union has frozen considerably more, with an estimated €260 billion of Russian central bank assets. These impressive figures represent the largest sanctions package in history, yet the legal limbo they’ve created highlights significant tensions between political objectives and legal constraints.
International Law Concerns
Multiple legal experts have raised concerns about the legality of both freezing and potential seizure actions. The Armadillo reported, international lawyer Michael Swainston KC told a UN Human Rights Committee that unilateral sanctions (those not authorized by the UN Security Council) violate international law: “Unilateral coercive measures violate human rights. They kill… They amount to collective punishment without trial under a law that is usually retrospective and vague.”
The legal justification for converting frozen assets to permanent seizures appears particularly thin. According to Politico, European Central Bank President Christine Lagarde warned: “Moving from freezing the assets to confiscating and disposing them carries the risk of breaking international law that you want to protect.” French Finance Minister Bruno Le Maire was even more direct, stating simply that “the legal justification does not exist.”
These legal concerns explain why most Western nations have hesitated to move from freezing to seizing Russian assets. The EU has decided to use only the interest generated by Russian assets without touching the principal for now, a compromise that generates significantly less funding than full asset seizure would provide.
The Due Process Problem
The impact of sanctions on Russia extends beyond state assets to affect individual Russian citizens, raising serious due process concerns. The process for designating individuals for sanctions lacks adequate procedural protections: “The decision is based on a ministerial decision not a court finding. The process is opaque, secretive and the individual has no opportunity to see the evidence against him and defend himself.”
The evidence standard for sanctioning individuals appears troublingly low. According to The Spectator, sanctions designations often rely on “Google searches, social media posts, obscure online messages and unverified articles on anti-Putin websites.” This creates situations where individuals with minimal connections to the Russian government find themselves unable to access their own finances.
These procedural deficiencies have real-world consequences. According to a recent The Times report, Nerijus Kuskys, a Lithuanian estate manager for Russian billionaire Mikhail Fridman, had his bank account frozen without warning or explanation. When he tried to obtain clarification from his bank, he was met with evasion: “We cannot give you an explanation,” the manager said. “You need to call head office.” Despite multiple attempts, he received no answers about why his account was targeted.
Historical Precedents and Legal Risks
Those advocating asset seizures face uncomfortable historical comparisons. The expropriation of assets from targeted groups has troubling historical parallels, most notably the Nazi confiscation of Jewish property in the 1930s. At the Nuremberg trials, industrialist Friedrich Flick was condemned for profiting from confiscated Jewish-owned assets, with the tribunal stating: “A sale compelled by pressure or duress should be questioned in a court of equity. Taking of property by the sovereign (state) without just compensation is forbidden.”
These historical precedents create significant reputational and legal risks for Western governments. According to UnHerd, the UK’s National Crime Agency faced embarrassment after raiding an oligarch’s mansion in north London with a warrant that contained “technical errors.” They ended up paying damages to the oligarch for trespassing on his property and covering his legal bills, undermining confidence in the sanctions enforcement regime.
Are Russian Sanctions Working? Economic Assessment
The legal limitations of the sanctions regime contribute to broader questions about effectiveness. The New Yorker notes that sanctions generate meaningful change only about 40% of the time. This mediocre success rate stems from issues including legal limitations, inconsistent implementation, and the ability of target countries to find alternative partners.
So are Russian Sanctions working? The evidence increasingly suggests that sanctions are not working as effectively as Western policymakers hoped, at least in terms of economic impact. According to Monde Diplomatique, Russia’s GDP grew by 3.6% in 2023 and was projected to expand by 3.2% in 2024, outpacing all advanced economies. This contrasts sharply with early IMF forecasts that predicted an 8.5% contraction in 2022.
Russia’s military spending has increased substantially despite sanctions. Russian President Vladimir Putin signed off on a 70% increase in defense and security spending for 2024, to $157.5 billion. The entire Russian budget of $412 billion was itself 13% higher than the previous year, based on higher expected earnings from oil.
Legal Innovations and Alternative Approaches
Facing these challenges, some countries have begun exploring alternative legal frameworks for asset seizure. According to UnHerd, “Canada passed a law allowing its government to seize sanctioned assets, in order to help Ukraine and compensate Putin’s victims. In December, it began a confiscation process against wealth owned by one of Abramovich’s companies under this new simplified procedure.”
These innovative approaches attempt to create new legal pathways for asset seizure, though they remain untested in international courts. Legal organizations like REDRESS argue that confiscating funds for the benefit of Ukraine is “justified under international law as a countermeasure to the invasion of Ukraine if it is intended to induce Russia to end its illegal war and provide reparation.”
Conclusion: Toward Legally Sound Economic Statecraft
The tension between political objectives and legal constraints in the Russia sanctions regime highlights fundamental challenges in using economic tools for geopolitical purposes. Moving forward requires addressing the legal foundations of sanctions while maintaining commitment to rule-of-law principles that differentiate Western democracies from authoritarian regimes.
Several approaches could strengthen the legal basis for more effective sanctions. First, creating more robust international legal frameworks through multilateral cooperation rather than unilateral action might enhance legitimacy. Second, ensuring stronger due process protections for sanctioned individuals would better align with human rights standards. Finally, developing specialized international tribunals to adjudicate sanctions designations could provide independent oversight while maintaining strategic flexibility. Without such reforms, Western governments risk undermining the very legal principles they claim to defend through their Russia sanctions policy. This legal self-contradiction ultimately weakens sanctions effectiveness while raising questions about Western commitment to rule-of-law principles in international relations, potentially creating harmful precedents that could be weaponized by other actors in future conflicts.
