France in G7 opposes US position on confiscation of russian assets

Le Maire, speaking after a meeting of G7 finance ministers, rejected the US position and said France was convinced that there was no sufficient basis in international law for this and that further work was needed.

He said any such moves must be fully supported by international law and require the support of all members of the Group of 20 largest economies, which includes russia, China and other countries critical of the United States.

G7 representatives have been trying for a year to agree on what to do with russian sovereign assets that have been immobilized since Moscow's invasion of Ukraine in February 2022. G7 leaders have asked for possible solutions by June.

Their debate this week on the sidelines of the G20 meeting of finance ministers of the world's largest economies in Sao Paulo showed that this time is still quite far away.

"This is not necessarily a confrontation. We continue to have discussions on the sidelines aimed at achieving a common goal, which is to find measures that are consistent with international law," Masato Kanda, Japan's vice minister of finance for international affairs, told reporters after the G7 ministers' meeting.

As a reminder, Yellen recently told reporters that there are "strong international legal, economic and moral reasons" to benefit from russian assets, either by confiscating them in full or using them as collateral, and that the "countermeasure theory" justifies such actions from the point of view of international law.

Le Maire, when asked specifically about the theory of countermeasures, said he disagreed.

"We do not believe that this legal framework is sufficient," he said. According to him, a broad international consensus is needed.

"This legal framework should be adopted not only by European countries, not only by G7 countries, but by all member countries of the international community, and I mean all G20 member countries. We should not make any differences between the G20 countries," he said.

Despite the public controversy, one Western official, who asked not to be named, said that the G7 is unanimous in saying that Moscow must pay for the damage it has caused. The official noted that a growing number of experts believe that there is a legal path to confiscate frozen assets.

Le Maire argues that the European Union has already made a significant step forward by using the excess profits from frozen assets, and this opinion was supported by German Finance Minister Christian Lindner.

Lindner told reporters that he favors using the interest earned on frozen russian assets to support Ukraine, calling it "a realistic step that is legally safe and can be implemented quickly."

Washington supports the idea of a windfall tax, but argues that more significant action is warranted given the egregious nature of russia's invasion.

Source: Reuters