Belgium's Supreme Administrative Court (the Council of State) sided with the Russian side and annulled the authorities' refusal to unfreeze the assets of BKS Bank. In 2024, the treasury refused to unblock the funds and securities, arguing that the bank had not proved a complete termination of relations with the National Settlement Depository (NSD), which is under sanctions. In addition, the agency stated that after unfreezing, BKS Bank intended to transfer the funds outside the EU, which allegedly complicated control over compliance with European sanctions.
Having reviewed the case materials, the supreme administrative court ruled that the verdict had been issued by an incompetent body, and overturned the ruling. Thus, this is not about recognizing the blocking itself as illegal, but about the fact that the refusal to unblock was issued by a person who did not have the authority to do so.
"The catch is in the system of delegation of powers. The European regulation provides that certain decisions on unblocking frozen assets are taken by the 'competent authorities' of member states. In Belgium, the corresponding powers were transferred to the general administrator of the treasury. The Council of State concluded that the wording turned out to be too broad and vague. That is, the clear boundaries of the official's powers were not established," explains Alexander Kazarin, head of the special projects practice at the law firm VEGAS LEX.
Court disputes over the unblocking of assets have already occurred. For example, in November 2024, an applicant from Moscow challenged the refusal to transfer securities from Euroclear. At that time, the Belgian authorities themselves withdrew the ban, recalls Oleg Karkov, head of the corporate practice at the law company a.t.Legal.
However, the BKS Bank case is substantially different. It concerns the fact that the state is obliged to comply with its own constitutional and administrative law. Here the Council of State, in essence, for the first time checked whether the treasury had the authority to consider the issue of unblocking assets. And the court directly recognized as illegal the mechanism on the basis of which an official made decisions on sanctions applications, says Andrey Gusev, senior partner at the Nordic Star law bureau. Therefore, the significance of the verdict goes beyond a single refusal - it may have consequences for other owners of frozen assets.
Nevertheless, this victory does not mean automatic unfreezing of the funds: the Belgian authorities will reconsider the Russian bank's application. A positive outcome of the new proceedings is, of course, not guaranteed, but at least BKS Bank will get the opportunity to defend its rights.
The struggle promises to be difficult: after filing the first application, BKS Bank itself came under restrictions. In November 2024, it ended up on the US sanctions list, and since July 2026, also on the European one. These sanctions cannot be considered removed because of the annulment of the Belgian refusal of 2024, Karkov clarifies. And yet EU Regulation No. 269/2014 provides for exceptions under which the competent authority may permit the release of frozen funds, Gusev recalls. So it is too early to speak of a final outcome.
For other investors, it is extremely useful that the Council of State rejected the position of the Belgian authorities, who were confident that US sanctions against the NSD make European unblocking pointless, the experts emphasize.
"In the court's opinion, US restrictions cannot be considered indefinite in advance, and the possibility of unblocking assets at the EU level is in itself sufficient to preserve the applicant's interest in judicial protection. This is very significant: the existence of a parallel sanctions barrier in another jurisdiction does not in itself mean that it is pointless to seek the unblocking of assets in the EU," Gusev points out.
Meanwhile, the EU is again discussing how to use Russian frozen assets to finance Ukraine. They planned to transfer the funds to Kyiv as a loan, which is subject to repayment only after receiving "reparations" from Moscow. The European Commission does not consider such a scheme theft, but Belgium, along with some other countries, is opposed because of high legal and financial risks.
Recall: after the start of the special military operation, the EU and the G7 countries froze about 300 billion euros of Russian foreign exchange reserves, a significant part of which is located in Europe. And since the assets are mainly concentrated in the Belgian depository Euroclear (around 200 billion euros), the position of the country's authorities carries great weight. European allies were unable to convince Belgium to take the risk, but at the demand of Sweden, Poland, the Netherlands and Spain, EU officials returned to searching for possible options. Additional court proceedings will drag out the process even more.