The Legal, Practical, and Moral Case for Transferring Russian Sovereign Assets to Ukraine
In February 2022, President Vladimir Putin launched a full-scale war of aggression aimed at destroying Ukraine as an independent state. As the human and financial toll of Putin’s illegal war climbs with each passing day, there is a growing global consensus that Russia has an obligation to pay for the death and destruction that it has wrought on the Ukrainian people and other victims of Russia’s aggression, unprecedented since the end of World War II. Although many countries have frozen Russian sovereign bank assets in response, they can and must do more. Any country that currently holds Russian assets should transfer them to Ukraine to help that sovereign nation survive and rebuild.
To this end, RDI has issued a comprehensive report on Constitution Day, 2023, demonstrating that transferring Russia’s assets to Ukraine is currently possible with no changes in U.S. law. This report was principally authored by constitutional scholar Laurence Tribe in partnership with his colleagues at the law firm Kaplan, Hecker & Fink LLP.
In these extraordinary circumstances, the President’s power to execute the proposed transfer flows from the International Emergency Economic Powers Act (“IEEPA”). Subsection B of IEEPA explicitly empowers the President to “block” and/or “direct and compel” the “transfer” of “any right, power, or privilege with respect to” Russia’s “property.” Traditional tools of statutory interpretation demonstrate that “transfer” means the conveyance of a property interest from one entity to another. Thus IEEPA authorizes the President to “direct and compel” the conveyance of Russian sovereign assets to Ukraine. RDI’s report removes any reasonable doubt about the consistency of such transfer with precedent and historical practice and shows that it would be fully consonant with the United States Constitution and all applicable congressional statutes.
The proposed transfer also comports with settled principles of international law. Because Russia’s actions constitute grave and ongoing violations of international law and lack even a plausible justification, the doctrine of countermeasures entitles the United States and its allies to respond to Russia’s flagrant actions so as to induce its compliance with international legal norms. RDI’s proposed transfer of Russia’s assets to Ukraine would satisfy the key requirements of a lawful countermeasure, including the principles of proportionality and reversibility.
Objections based on claims of “sovereign immunity” are baseless. Using Russia’s assets as a countermeasure helps restore the principles of national sovereignty; it doesn’t violate them. Moreover, sovereign immunity as a legal doctrine arose out of the need to prevent the courts of one state from sitting in judgment on the actions of another. It is thus a doctrine applicable only in judicial proceedings, not one designed to hamstring a country’s foreign policy as reflected in executive or legislative action. There is simply no basis for saying that Russia can violate Ukraine’s sovereignty while invoking its own sovereignty as an inviolable shield—especially given that the United States and its allies have already crossed the Rubicon and frozen Russia’s assets.
Russia’s assets could be transferred to Ukraine in a manner that is transparent and accountable, with safeguards against the abuse of these legal authorities in the future. RDI’s report demonstrates that the policy objections to such transfer rest on misconceptions: The U.S. dollar will remain the world’s reserve currency because of unique structural advantages, and Russia possesses few, if any, avenues to meaningfully retaliate to the transfer of its assets to Ukraine. Not only would transferring Russia’s frozen assets to Ukraine make strategic sense. Failing to do so would embolden lawless aggressors by sending the dangerous signal that the United States and its allies lack the political and moral will to do all it takes to stop President Putin and his military from murdering civilians and flouting the basic rules of the international order.
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The authors are grateful to a number of individuals whose contributions were invaluable to the production and publication of this report. Angela Scorese was essential in assisting the authors’ research and in moving the report through the publication process. Elizabeth Wallace and James Piltch, as Summer Associates at Kaplan Hecker & Fink LLP, conducted crucial research and assisted in drafting portions of the report. Alysha Naik, James Blum, and Peter Kaplan helped to finalize, fact check, and proofread the report.
This report was made possible by generous donations to RDI from many individuals and organizations all of whom support the idea advanced by the report but none of whom sought to influence the analysis or conclusions reached by the report’s authors. Thus, the views expressed in this report are solely those of RDI and of the report’s authors, not of Kaplan Hecker & Fink LLP or of RDI’s donors.