German Chancellor Friedrich Merz on Thursday rejected a reported US proposal to place some Russian assets frozen in the European Union (EU) under Washington’s control, insisting that decisions over the funds must remain in European hands.

“These are assets that are frozen in Europe. They should also remain frozen in Europe,” Merz said ahead of a two-day EU summit in Brussels on October 15-16. “That is our affair, and we will decide on that.”

His remarks followed a Financial Times report that Washington had proposed transferring some frozen Russian sovereign assets to a financial mechanism overseen by the United States in an effort to revive peace negotiations between Russia and Ukraine. The newspaper reported that the proposal was presented by US special envoy Steve Witkoff and Jared Kushner, son-in-law of US President Donald Trump, but European representatives rejected it. Reuters said it could not immediately independently verify the report.

Around €210 billion ($235 billion) in Russian central bank assets remain immobilised in the EU following Moscow’s February 2022 invasion of Ukraine. Approximately €185 billion of the total is held by Euroclear, a Brussels-based central securities depository.

EU divided over use of Russian assets

The future of the frozen funds remains a sensitive issue for European governments, which face competing demands to support Ukraine while managing legal and financial risks associated with using Russian state assets.

The EU has already established a mechanism to channel extraordinary revenues generated by the immobilised assets towards Ukraine. Under the bloc’s existing framework, most of these proceeds are allocated to help Ukraine repay loans provided by the EU and G7 countries, while a smaller share goes to the European Peace Facility. The principal assets themselves remain frozen.

In August 2026, the EU received a further €1.4 billion in extraordinary profits generated by the immobilised Russian assets, bringing the total revenue transferred since their immobilisation to €8 billion, according to the European External Action Service.

European governments have also debated whether the frozen assets could be used more directly to finance Ukraine’s military and economic needs. Such proposals have raised concerns over legal challenges, possible Russian retaliation and the potential consequences for confidence in European financial markets.

The reported US proposal adds another dimension to the dispute, raising questions over who would control the funds and how they might be used in any future settlement of the war.

Merz calls for more support for Ukraine

Alongside his remarks on the frozen assets, Merz called for continued and increased support for Ukraine, warning that Russian attacks were becoming increasingly ruthless.

He said European countries needed to do everything possible to help Ukraine through the winter and into next year, adding that additional resources would be necessary to provide sustained assistance.

Merz argued that supporting Ukraine was not only about defending its territorial integrity but also about protecting Europe’s political order.

Ukrainian President Volodymyr Zelenskyy was expected to attend the Brussels summit on Friday, October 16, as European leaders discussed the bloc’s priorities and its continued response to Russia’s war against Ukraine.

Meanwhile, Kremlin spokesman Dmitry Peskov said Moscow had no information about the reported US proposal and questioned the reliability of media reports about the matter. (ILKHA)