EU approves €1.4 billion from frozen Russian assets for weapons purchase for Ukraine, Politico reports

Today, EU countries approved the first tranche of military aid to Ukraine totalling up to €1.4 billion, sourced from frozen Russian assets.

As reported by Politico, the funds are allocated through the Ukrainian Assistance Fund (UAF), but payments have been blocked by Hungary. 

However, the EU Council Legal Service asserts that Budapest cannot stop these payments because it abstained during the vote earlier this year to create the UAF. The reason allowing for this bypass is that the funds do not come from EU taxpayers, EU officials said.

The money will not go towards compensation, as is typically the case with the UAF, but towards direct procurement of equipment such as ammunition and air defence systems. One quarter of the amount will be spent on purchases from the Ukrainian industry.

Countries had time until 11:00 to voice their opinions, and none voted against, according to an internal council message seen by Politico. The decision did not require unanimity, meaning Hungary could not block it.

Despite today's agreement, Hungary continues to block the payment of €6.6 billion under the Politico program as partial compensation for the weapons purchased for Ukraine. One diplomat, Budapest was "furious" about what happened today.

The final amount of profit from frozen assets that will go towards buying weapons is still unclear, but diplomats say it is estimated to be between €1.2 billion and €1.4 billion.

An official announcement is expected after a meeting of EU foreign ministers in Luxembourg on Monday.

Josep Borrell, High Representative of the European Union for Foreign Affairs and Security Policy, said that Ukraine will receive the first instalment of  €2.5 billion from the proceeds of frozen Russian assets next week.

Earlier, Borrell said that the EU had developed a legal route to bypass Hungary's veto on arms purchases for Ukraine using the proceeds of frozen Russian assets this year, which could also clear the way for the G7 to disburse US$50 billion to Kyiv.