Japan calls for law-abiding fix to handling of frozen Russian assets

FILE PHOTO: Japanese Finance Minister Shunichi Suzuki arrives for a news conference during the annual meeting of the International Monetary Fund and the World Bank, following last month’s deadly earthquake, in Marrakech, Morocco, October 13, 2023. REUTERS/Susana Vera/File Photo

By Leika Kihara

TOKYO (Reuters) – Japan wants any handling of frozen Russian assets to abide by international law, its finance minister said on Friday, adding that the topic will likely be discussed at next week’s meeting of his counterparts from G7 advanced economies.

“I don’t think there is consensus yet among the countries on what to do with the frozen Russian assets,” Suzuki told a press conference.

“Japan’s stance is that it must be handled in a way that does not violate international law,” he said, suggesting Tokyo is cautious over the idea, floated by Washington, of confiscating frozen Russian assets outright – a move some experts warn could lead to legal disputes.

Suzuki is expected to travel to Washington D.C. next week to attend the G7 and Group of 20 finance leaders’ gatherings, to be held on the sidelines of the International Monetary Fund (IMF) spring meeting.

The EU and the Group of Seven nations (G7) froze some 300 billion euros of Russian central bank assets following Moscow’s invasion of Ukraine. The EU and G7 have been debating if and how these funds can be used for over a year.

The United States has floated the idea of confiscating the assets outright but EU officials view this as legally too risky.

In February, the EU adopted a law to set aside windfall profits made on frozen Russian central bank assets in a first concrete step towards the bloc’s aim of using the money to finance the reconstruction of Ukraine.

Moscow has said any attempt to use frozen Russian assets as collateral to raise funds for Ukraine would be illegal and lead to years of litigation because Moscow would challenge it.

(Reporting by Leika Kihara; Editing by Shri Navaratnam)