99% rejection rate: how did Belgium deprive Russians of chances for quick unblocking of assets?

In the fall of 2025, Russian lawyers faced a sharp increase in the number of refusals by the Belgian Treasury to issue individual licenses to private investors to unblock assets in Euroclear, six lawyers specializing in such matters told Oninvest. This is due to new requirements of the Belgian regulator, which the latter began to apply retrospectively. The new conditions prove impossible for the majority of Russians who applied in 2024-2025 or transferred assets between brokers after 2023, the lawyers complain. They are already preparing their clients for a further fight - in the Belgian Council of State, Belgian courts and international investment arbitration, since Belgium will not accept corrected reapplications either.

In the fall of 2025, the Belgian Treasury dramatically revised the requirements for applications by private Russian investors for an individual license to unlock assets in Euroclear, which caused a sharp rise in the number of rejections in September-October, five lawyers specializing in such cases told Oninvest.

At the same time, according to Elena Ryazanova, all applicants are rejected. Even those who have actually been living outside Russia for many years and "not just on paper", but are actually residents of the EU.

Kira Vinokurova, a lawyer and advisor to Atlus Capital investment bank, confirms that formal refusals by the Treasury have become more frequent, and the processing time has increased to 6-12 months. Many cases are still "pending", which can distort the statistics, she adds.

The regulator not only set new requirements, but also began to apply them to previously submitted applications, says Ekaterina Drozdova, advisor at FTL Advisers. According to her, earlier the rules of the game were more or less clear, and with proper preparation of the application one could expect a positive decision with a high probability, but the changed rules "turn the unblocking process into a lottery".

"There are really a lot of rejections, colleagues share with each other that they receive them, quote, 'in packs'," says Oninvest's source in the legal market.

Delcredere Bar Association and NSP Law Office, which also specialize in similar cases, declined to comment. BGP Litigation lawyers had not responded to the request by the time of publication

Among the Treasury's new requirements is the termination of the applicant's relations not only with the sanctioned National Settlement Depository (NSD), but also with its Russian broker, including non-sanctioned ones. Moreover, the applicant's relations with them must now be terminated strictly before January 7, 2023, Oninvest's interlocutors say.

A more formal reading of Article 6(5) of EU Council Regulation No. 269/2014 allows the Belgian Treasury to make such a claim. Under this article, assets can be unblocked if they are unblocked in order to terminate, no later than January 7, 2023, transactions, contracts or other agreements entered into directly with NSD or otherwise related to NSD before June 3, 2022 [on which date NSD became subject to EU sanctions - Oninvest's note], Sergey Gerasimov explains.

"Previously, the regulator was satisfied with investors' assurances that they had no direct relations with NSD and a declarative intention to terminate them. Now it requires confirmation of the termination of any relationship involving NSD along the entire chain, including with the broker," explains Ekaterina Drozdova, counselor.

The Belgian Treasury ignores the fact that most applicants do not have direct contractual relations with NSD, and it is impossible to completely terminate relations with a Russian broker while the frozen securities are on its account, explains Gerasimov.

According to Drozdova, the new reading of the regulations may become a problem for "the vast majority of applicants who applied in 2024-2025", as "no one could have foreseen the appearance of this retrospective requirement". And those who transferred their assets to non-sanctioned brokers in 2023 and later cannot fulfill this requirement in principle, the expert adds. Previously, there have been precedents of licenses being issued to investors who actively moved securities after this date, Elena Ryazanova wrote in her Telegram channel Invest.Lawyer.

The second innovation is that the date for submitting not only collective but also individual applications for unblocking must now be no later than January 7, 2023. It was by this deadline that Russian brokers and management companies had to submit their clients' collective applications for unblocking.

Previously, there was a concept that a collective application was submitted before January 7 and the investor submits his own application in addition to the collective one, Elena Ryazanova tells Oninvest. "Apparently, this concept will not be applied now. This reason risks becoming a blocking factor, as it cuts off the possibility of submitting new applications now," she specified.

The Treasury has now become scrupulous in checking the data in collective and individual applications, continues Kira Vinokurova. According to her, "any mis-synchronization causes additional requests and refusals.

Finally, the Belgian regulator became stricter in the fall about the choice of brokers, especially if they also act as guarantors of compliance with sanctions. Belgian Treasury documents state that the license gives an exception for the sale or transfer of assets in the presence of a guarantor acting under EU law and assuming control of sanctions risks and reporting before and after the transaction, says Vinokurova. "Practicing firms formulate it even tighter: the guarantor must be a legal entity from an EU member state. The ideal formula is as follows: the guarantor is an investment firm or a professional participant from the EU that is ready to sign a letter of guarantee and undertake KYC/AML control and post-transaction reporting," she says.

Elena Ryazanova said that in practice the Treasury still allowed investors to withdraw assets to such brokers in the UK and Switzerland, but now this possibility is closed. Tightening to the jurisdiction of the broker did appear, confirms Ekaterina Drozdova. For example, the regulator was not satisfied with the account of a client of FTL Advisers opened in a branch of a Swiss bank in Monaco.

According to Tatiana Neveeva, Cyprus remains the most reliable choice for opening an account for private investors. "In this jurisdiction, clients do not run the risk of encountering resistance from local players to both opening an account and a sudden refusal to execute an order at the last moment," she notes.

One of the most painful innovations was the abolition of the second chance for applications that were rejected. Previously, investors had to re-submit an application after correcting the remarks or attaching missing documents, says Oninvest's source. As a rule, in such cases one could count on a positive decision of the Belgian regulator, he claims. For example, Delcredere lawyers reported that they obtained licenses for their clients through administrative review of rejected decisions.

Now the opportunity to correct deficiencies and reapply - the so-called "error work" - is virtually non-existent, says Ekaterina Drozdova. "Now this mechanism is closed: it is impossible to resubmit an application on the same grounds. The regulator replies that "the application has already been considered, and the answer given is final." In essence, there is no longer any right to make a mistake. Documents must be prepared perfectly the first time," wrote Elena Ryazanova.

According to Tatyana Neveeva, in the event of a rejection, Russian investors do not lose their chances of unblocking. The main options are to file an administrative appeal to the Belgian Council of State within 60 days of receiving the refusal. "Unblocking itself is not within its competence, but it can return the documents to the Treasury for review," she specifies.

Delcredere's lawyers noted that the State Council has been receiving complaints from Russian private investors about the impossibility of unblocking through obtaining a license since the end of 2023, but the practice on such cases has not yet been formed. Due to the projected increase in the number of appeals to the State Council, all of Oninvest's interlocutors advise to allow 1.5-2 years for their consideration.

Belgian national courts also consider cases of blocking at Euroclear, and there are precedents of unblocking through Euroclear, reminds Kira Vinokuorva. As an example, she cites the case of the Libyan Sovereign Fund, whose funds were blocked in 2011 due to political instability in the country after the overthrow of Muammar Gaddafi's regime. In the winter of 2025, it became known that the seizures from the accounts were lifted following a decision of the Court of Appeal in Brussels.

Ekaterina Drozdova of FTL Advisers suggests that due to emerging practice in the State Council and national courts, the regulator may update its application requirements, which could quell discussions about January 7, 2023. "But this will require additional time," she concludes.

Another option is to appeal to international investment arbitration, Oninvest's interlocutors say. Two investors have already made such an attempt in early September, having sent a notice of dispute to the Belgian authorities. The investors justified the possibility of appealing to arbitration by the agreement on mutual promotion and protection of capital investments, which in 1989 the authorities of Belgium and Luxembourg, where Euroclear and Clearstream depositories are based, concluded with the USSR, and by the fact that Russia is the legal successor of the USSR. Such proceedings should take 6-9 years, BGP Litigation partner Sergey Glandin estimated earlier for Oninvest.

The lawyers admit they are preparing for a litigation scenario as well. "We are focused on finding ways to satisfy the Belgian Treasury's nagging questions about documents, or, at the very least, to form a quality position for subsequent lawsuits from our clients against the Belgian Treasury," Sergey Gerasimov admits.

The lawyers interviewed by Oninvest cite two possible reasons for the drastic change in requirements. First, they attribute the tightening to the heavy workload of the Belgian Treasury, which has so far received many primary and secondary applications from Russian investors. "Against the backdrop of critical workload, the regulator is increasingly guided by the new expanded criteria for denying authorizations to investors. This allows it to reduce its workload, but at the same time leads to the fact that previously working approaches now do not work," says Ekaterina Drozdova.

Second, the tightening could be related to political uncertainty about the possibility of using frozen Russian assets to help Ukraine. "The reason for this is seen as an increase in legal risks for the state itself and Euroclear against the background of the EU's transition from the idea of "interest only" to the idea of a reparation loan secured by Russian sovereign assets," Kira Vinogradova believes.

In October, the EU discussed the use of €140 billion from the blocked assets to finance a reparation loan to Ukraine. Belgium objected to this scenario, demanding legal certainty and risk-sharing with other EU member states in case Moscow later lodges claims on the confiscated assets. The EU has so far rejected this configuration - EU leaders will return to the issue in December.

Article 17 of the EU Charter allows for the deprivation of the owner's property only upon payment of proportionate and fair compensation, so confiscation of assets without changing EU law is still an unlikely scenario, concludes Oninvest's source.

Oninvest sent a request to Euroclear.

This article was AI-translated and verified by a human editor