The war in Ukraine has so far caused damage valued at €600 billion, the European Union's executive arm said in a statement. Russia and its oligarchs have to compensate Ukraine for the damage and cover the costs of rebuilding the country, European Commission President Ursula von der Leyen said.
The EU and Group of Seven partners, including the U.S., have blocked €300 billion of the Russian Central Bank reserves and frozen €19 billion of Russian oligarchs' money, von der Leyen added.
"In the short term, we could create with our partners a structure to manage these funds and invest them. We would then use the proceeds for Ukraine," she said.
Once European sanctions are lifted, the frozen funds should be used to ensure that Russia pays full compensation for the damage caused to Ukraine. "We will work on an international agreement with our partners to make this possible. And together we can find legal ways to get it," von de Leyen said.
The European Union is proposing to set up a specialized court, backed by the United Nations, to investigate and prosecute Russia's crime of aggression, according to von der Leyen.
"We are ready to start working with the international community to get the broadest international support possible for this specialized court," she said.
The level of frozen Russian funds available to help rebuild Ukraine depends partly on the effectiveness of sanctions in having secured them. There is a risk that different member states could vary in how vigorously they enforce implementation based on their own laws.
The EU Commission proposed that an investment structure be set up to manage and invest the frozen Russian funds, using the proceeds to help rebuild Ukraine.
In the longer term, once the sanctions are lifted, the Russian central bank assets will need to be returned, the EU said. This could be linked to a peace agreement, which compensates Ukraine for damages. The assets that would need to be returned could be used to offset war reparations.
The EU on Monday made failure to enforce sanctions against Russia and other countries a bloc-wide crime to prevent potential violators from shopping around for member states with more lax enforcement.
The bloc will be establishing a new mechanism that allows member states to exchange information about sanctions in real time, according to an announcement on Oct. 24 by Mairead McGuinness, the financial services commissioner.
Coordination in international sanctions matters if any variations that offenders might exploit by shopping between jurisdictions are to be eliminated. The EU has worked closely with the U.S. and others to coordinate sanctions as far as possible, according to a statement by the European Council in November.
The Russian Elites, Proxies and Oligarchs Task Force was set up in March to allow the EU to cooperate with the G-7 group of countries, as well as Australia, to ensure that sanctions are implemented.
The EU has taken unprecedented sanctions against Russia, targeting 118 entities and 1,241 individuals so far.
The latest, eighth, package of EU sanctions against Russia formally adopted by the council on Oct. 6 targets those involved in the annexation of the Donetsk and Luhansk as well as the Kherson and Zaporozhye regions in Ukraine.
The EU then expanded the measures to include services that can no longer be provided to Russia, including legal services. It tightened prohibitions on crypto-asset services.
There has been no letting up. The commission announced in July a planned extension of its sanctions against Russia by six months until January 2023.
The executive body then expanded the range of sanctions to include bans on all gold imported from Russia and on accepting financial deposits from any organizations abroad which are majority owned by Russian nationals.
--Editing by Ed Harris.
Update: This story has been updated to add detail and background.
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