Wider Europe

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two big issues: Kosovo's chances of joining the Council of Europe and the weakening of the EU's sanctions on Russia.

Brief #1: Is Pristina On The Cusp Of Council Of Europe Membership?

What You Need To Know: Kosovo is taking one step closer to joining the Council of Europe, a body promoting human rights, democracy, and the rule of law in its member states. On April 16, the Parliamentary Assembly of the Council of Europe (PACE) will consider and vote on a report recommending the country's membership.

If a two-thirds majority of the assembly's delegates from 46 member countries vote in favor, that could set the stage for a final decision at a meeting of Council of Europe foreign ministers on May 16.

Membership in the council, which has been a goal for Pristina ever since its declaration of independence from Serbia in 2008, would mean, among other things, that Kosovars could have their cases tried at the Strasbourg-based European Court of Human Rights (ECHR). Not to mention that Kosovo would join the European Broadcasting Union (EBU), allowing it to take part in the much-celebrated, much-derided annual Eurovision Song Contest.

Belgrade has never recognized Kosovo's 2008 declaration of independence and has worked actively to prevent the country from joining any international organizations.

Deep Background: It is likely that the two-thirds majority will be reached. A report on the issue was approved on March 27 by PACE's Committee on Political Affairs and Democracy, which stated that "Kosovo's aspirations to join the Council of Europe should be met with a positive response." The plenary tends to follow committee decisions.

Currently, 12 out of the 46 Council of Europe member states do not consider Kosovo to be an independent state -- just short of a blocking minority. That includes Serbia and Bosnia-Herzegovina; the five nonrecognizers in the EU, Cyprus, Greece, Romania, Slovakia, and Spain; as well as Armenia, Azerbaijan, Georgia, and Moldova. Ukraine also doesn't recognize Kosovo's independence, largely because of the fear that Russia would use this as a pretext to push for wider international recognition of the Ukrainian territories it currently occupies.

Country representatives might not, however, vote according to their capitals' stated political views on Kosovo. For example, the Ukrainian representatives will have "a free vote," and it could be that other countries will follow suit.

PACE deputies from Hungary's ruling Fidesz party are likely to vote against the motion, despite Hungary's recognition of Kosovo's statehood, a reflection of Budapest's growing ties with Serbia. There will also probably be quite a few representatives opting to abstain, which would play well in Pristina's favor. It is significant that the author of the report, Dora Bakoyannis, is a former Greek foreign minister and sister of the current Greek prime minister, Kyriakos Mitsotakis. It is not inconceivable that, despite Athens' formal stance of nonrecognition, the Greek delegation will back Pristina's membership.

Drilling Down

• There are a number of reasons why there is a reasonable chance of Kosovo getting in now. Firstly, Russia was expelled from the Council of Europe shortly after its full-scale invasion of Ukraine in February 2022. With Moscow out, Serbia has lost one of its biggest allies in the fight. Then there is the fact that Kosovo has already successfully joined some Council of Europe-related bodies, such as the Venice Commission, an advisory board, and the Council of Europe Development Bank.
• Linked to that, the dialogue aimed at normalizing relations between Belgrade and Pristina, which is facilitated by the European Union, has been taking place since 2011 with varying degrees of diplomatic engagement. This dialogue is at an all-time low right now after a number of incidents in the last year, including Pristina's decision to enforce the use of Kosovar car license plates, local elections without the participation of ethnic Serbs, and the Belgrade-linked attack at the Banjska monastery that resulted in the death of a Kosovar police officer.
• Before all that took place, there appeared to be a major breakthrough, with both Serbia and Kosovo verbally consenting to the Ohrid Agreement, which aims to normalize diplomatic relations between the two. One of the key points of that agreement is that "Serbia will not object to Kosovo's membership in any international organization." There are two other important provisions: that Kosovo will "commit to ensure an appropriate level of self-management for the ethnic Serbian community in Kosovo" and will "ensure the security of the properties of the Serbian Orthodox Church within its borders."
• There are, however, two caveats related to Ohrid. Firstly, it wasn't actually signed by either party, even though Kosovar Prime Minister Albin Kurti did express his willingness to do so. So, its legality is questionable at best. Secondly, and more importantly, there is no agreed sequence on what the first next step should be.
• Essentially, Kosovo has jumped first. This happened in March when its government decided to hand over ownership of 24 hectares of land to the Serbian Orthodox Church monastery in Decani, western Kosovo. Kosovo's constitutional court had ruled in favor of the monastery being given the land in 2016, but successive Kosovo governments refused to heed the court's ruling. It was this U-turn that prompted Bakoyannis to recommend Council of Europe membership.
• There are other issues that Kosovo needs to address: the establishment of an association of Serbian-majority municipalities; and the issue of land expropriation in those municipalities. According to Bakoyannis's report, both of these issues should be a "postaccession commitment" for Pristina. The question is if the wider international community agrees.
• While the PACE vote next week is advisory and not binding, the real politicking will start in the run-up to the foreign ministers' meeting next month. As in the parliamentary assembly, a decision can be taken by a two-thirds majority, but that would be unprecedented. So far, ministers have always reached consensus on accepting new members.
• Serbia has already hinted that it will do its utmost to prevent Kosovo's membership, and, ultimately, Belgrade could win that fight. One scenario could be that no final decision is taken at all in May. The so-called Quint, consisting of France, Germany, Italy, the United Kingdom, and the United States, wants to see a proper draft law presented by Kosovo on the association of Serbian-majority municipalities before the countries can agree on the item even being on the agenda at the ministerial meeting.
• Those five countries see this as the last chance to pressure Kurti to agree on this contentious issue. With EU membership still only a pipe dream, Council of Europe membership is the last Western carrot on offer for Pristina. But even Council of Europe membership could be a step too far for Kosovo -- and not only for political reasons.
• While the establishment of the municipalities' association was agreed by Belgrade and Pristina back in 2013, Kosovo's Constitutional Court has questioned its legality. The judicial decision pertains to the scope of authority and ethnic structure within the organization, with indications that employment may be exclusively reserved for ethnic Serbs -- a practice Kosovo's court deems to be in violation of the constitution.
• So, while Kosovo might get boosted by a vote in the parliamentary assembly this week, a final decision by the 46 foreign ministers could be postponed by at least a year, if not more. Unless, that is, there is more progress in the weeks to come.

Brief #2: Are EU Sanctions On Russia Falling Apart?

What You Need To Know: It is fair to say that the European Union's sanctions regime against Russia has had a bit of a wobble in recent weeks, particularly with regard to the list of entities and people that the bloc has imposed asset freezes and visa bans on since the full-scale invasion of Ukraine in 2022.

As the European Union considers expanding the sanctions list, which currently includes 2,177 individuals and entities, three people were removed from the list in March during its routine biannual review, which requires the unanimous agreement of all 27 EU member states.

While that is a relatively small number, the delisted individuals were notable -- Arkady Volozh, the co-founder of the Russian Internet giant Yandex; businessman Sergei Mndoiants; and Jozef Hambalek, a Slovak national and head of the Russian nationalist Night Wolves motorcycle club in Europe.

Hambalek was the first EU national to be blacklisted in 2022. (Some of the other blacklisted individuals had EU passports in addition to their Russian citizenship.) When the entire list is up for renewal again in September, it's likely that more names will be removed, largely due to three recent rulings in the EU's Luxembourg-based General Court, a constituent part of the Court of Justice of the European Union.

Deep Background: On March 20, the General Court ruled that Nikita Mazepin, a former Formula One driver and son of the Russian oligarch Dmitry Mazepin, should be removed from the list. The EU has maintained that Mazepin senior is a member of Russian President Vladimir Putin's inner circle and has supported actions undermining the territorial integrity of Ukraine. Last fall, an EU court backed Brussels' reasoning on this in a landmark verdict.

When it comes to Mazepin junior, however, the General Court noted that the EU had failed to prove any link between father and son -- beyond the obvious family ties, that is -- and had insufficient evidence to apply restrictive measures on him.

And then, on April 10, the Luxembourg court delivered another legal blow for Brussels when it ruled that Petr Aven and Mikhail Fridman, both major shareholders in one of Russia's biggest financial institutions, Alfa Bank, should also be delisted.

The judges noted that there may very well be "a degree of proximity" between Aven and Fridman on one side and Putin or his entourage on the other, but that the EU had failed to demonstrate that the pair either supported actions and policies undermining Ukraine's independence or provided material or financial support to destabilize the country.

Drilling Down

• It's important to remember that Mazepin junior, Aven, and Fridman do still remain under EU sanctions. How come? First of all, the EU can appeal the verdict within a period of two months and 10 days. Second, Brussels is also using something of a legal quirk in the sanctions regime to keep them blacklisted.
• The EU has argued that the three men's judgments only cover the period from their initial listings in February 2022 to March 2023. Since then, the EU has renewed the sanctions list, with the three men's names included, both in September 2023 and, most recently, last month. According to EU officials, these renewals are more than just a technicality; in fact, they produce new lists every six months as some names are added and some are removed.
• In this way, the EU is forcing the still-sanctioned individuals to file a new case at the European Court of Justice (ECJ) to challenge the most recent sanctions update. Legal proceedings are time-consuming, and when the time for renewal comes around every March and September, the wheels of justice are still turning, enabling the EU to stay ahead.
• This was how the EU managed to keep former Ukrainian President Viktor Yanukovych on a sanctions list until 2022, even though he won his first case in an EU court back in 2019 and then, over the next two years, won another two legal battles.
• The extra time that Brussels is buying itself could allow it to present additional evidence for the court to consider. This is what happened to Violetta Prigozhina, the mother of the now-deceased Russian oligarch and mercenary leader Yevgeny Prigozhin. In March 2023, she became the first person challenging the EU's Russia sanctions to win at the ECJ. But according to sources familiar with the file who don't have the authority to speak on the record, the EU then managed to present additional details. Prigozhina has remained sanctioned ever since.
• To date, 115 cases have been filed at the EU court requesting the delisting of people or companies. Many are filed by rich, sanctioned Russian businessmen who are able to spend vast sums on European lawyers to fight their cases. So far, the EU has won 33 cases and only lost eight -- a pretty decent scorecard for Brussels. The recent trio of losses could set a precedent, though, and mean more legal blows for the EU in the months ahead.
• Ultimately, it remains a political decision whether those three Russians and others remain listed come September. For pretty much every renewal so far, Hungary has attempted to leverage its veto by asking for some names to be dropped. Previously, the EU managed to secure another six-month rollover by offering to remove people that the EU's own legal service marked as "weak" due to insufficient evidence.
• For example, last fall, two lesser-known Russian businessmen, Aleksandr Shulgin and Farkhad Akhmedov, were removed from the list. But considering that Budapest had previously asked for Aven, Fridman, and Mazepin junior to be removed, they are likely to make a similar request soon enough, especially since they are now backed by the EU's own court on the matter.

Looking Ahead

EU leaders are gathering in Brussels for another summit on April 17-18. The meeting will mainly focus on economic issues and relations with Turkey, but attendees will also talk about Ukraine and how the EU can boost its defense industry in order to send more arms to Kyiv.

A few days before the EU leaders meet, on April 16-17, the National Conservatism Conference (often referred to as "NatCon") will take place in the EU capital. The annual event, bringing together right-wing politicians and think tankers, will be headlined by Hungarian Prime Minister Viktor Orban and the pro-Brexit British politician Nigel Farage. Expect a lot of Brussels-bashing and talk of how Euroskeptic parties must win the upcoming European Parliament elections.

That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

If you enjoyed this briefing and don't want to miss the next edition subscribe here.

Welcome to Wider Europe, RFE/RL's newsletter focusing on the key issues concerning the European Union, NATO, and other institutions and their relationships with the Western Balkans and Europe's Eastern neighborhoods.

I'm RFE/RL Europe Editor Rikard Jozwiak, and this week I'm drilling down on two big issues: how the EU could transfer profits from frozen Russian assets to Ukraine -- perhaps as soon as July -- and the challenges NATO faces as it turns 75.

Brief #1: Will Ukraine Benefit From Russian Assets?

What You Need To Know: The European Union is inching closer to a historic decision on using profits from Russian assets frozen by the bloc to help Ukraine. The Russian central bank's assets were frozen shortly after the full-scale invasion of Ukraine in February 2022 and have remained so ever since. The securities and cash frozen in the G7, the EU, and Australia are estimated to be worth roughly 260 billion euros ($282 billion). Assets worth an estimated 210 billion euros are in the EU, mostly in Belgium, the home of Euroclear, a user-owned financial services company specializing in securities transactions.

In February, the first step by Brussels was completed by setting aside the profits accumulated from the frozen assets. On March 20, the European Commission proposed the initiation of the second and final step -- sending the actual cash to Ukraine. This comes after EU foreign ministers, two days before, tasked EU foreign policy chief Josep Borrell with coming up with a proposal for making this happen.

None of the 27 member states have objected so far, although it's far from a done deal. Leaders and officials from EU member states still have to study the European Commission's proposal and give it a unanimous green light. Diplomats and officials are expected to start studying the fine print of the text today.

Deep Background: The proposal, seen by RFE/RL, notes that the first step of the process, the setting aside of profits, started on February 15 this year: "the central securities depositories (CSDs) are prohibited from disposing of these profits, or distributing them to shareholders, until the [European] Council decides on the financial contribution to be raised on them to support Ukraine."

CSDs are institutions, such as Euroclear, that hold and administer securities and enable their transactions. The step is thought to have raised something between 2.5 billion and 3 billion euros. The European Commission hopes that this money can be sent to Ukraine by July, provided that member states approve. There are also hopes in Brussels that comparable sums can be sent to Kyiv each year after that, depending on annual interest rates.

There are a number of "assurances" in Borrell's proposal for member states worried that this move could amount to a seizure of private property -- with private ownership being a fundamental EU right -- or could damage the bloc's common currency, the euro. The document notes that "the generation of unexpected and extraordinary revenues...are not the property of the Russian central bank as there is no legal or contractual provision for interest to be paid to the owners of the principal.

Since these revenues only exist as a result of the restrictive measures, there can also be no legitimate expectation that they should remain with the central securities depositories and their shareholders." The proposal also added that any retroactive claims by Moscow won't be accepted: "Unexpected and extraordinary revenues do not have to be made available to the central bank of Russia under applicable rules, even after the discontinuation of the transaction prohibition. Thus, they do not constitute sovereign assets. Therefore, the rules protecting sovereign assets are not applicable to these revenues."

Drilling Down

• There are other "goodies" to entice member states to quickly come on board with the proposal: an expected 3 percent of the profits from the frozen assets will remain with the CSDs "to ensure the efficiency of their work." In the future, the financial services companies will also be able to provisionally retain 10 percent of the profits to cover potential legal fees, as it's highly likely that Russia will take them to court.
• Several EU officials I have spoken to on background have played down the possibility of damaging the euro's position as the second reserve currency in the world. The fact that Brussels has pondered this move for several months already without any impact on the common currency in terms of trading or value is being cited in support of that argument. Another argument in support of the move is that other G7 countries are also mulling similar moves, so it might not be just the euro that is potentially exposed.
• Then there is the European Commission's proposal of how the money should be spent, which gives member states even more potential oversight -- and even veto opportunities. Initially, it was thought that the money generated from the profits would go to the reconstruction of Ukraine. But as the war drags on and no one expects widespread reconstruction to start anytime soon, the EU proposal states that 90 percent of the money should go to the supply of military equipment for Kyiv and the remaining 10 percent to regular financial aid.
• That proposed 10 percent would be channeled via the regular EU budget, so it doesn't need an explicit green light from any member states. But the 90 percent should go via the European Peace Facility (EPF), an off-EU-budget mechanism that has allowed Brussels to send money to Ukraine for arms purchases. The EU has so far sent 5.6 billion euros ($6.1 billion) for the purchase of arms and artillery to Kyiv over the last two years via EPF but has, for the last 10 months, failed to sign off on a 500 million-euro EPF tranche after a long-standing Hungarian veto. The veto stems from Budapest's dispute with Kyiv over a blacklist produced by Ukraine's National Agency on Corruption Prevention. The Hungarian bank, OTP, is on that blacklist and labeled an "international sponsor of war" as it continues to do business in Russia.
• While the bank was de-listed in the fall, Budapest has sought assurances that it won't happen again in the future, something that so far has not occurred. Recently, the EPF ceiling was raised by 5 billion euros specifically for Ukraine, paving the way for even more EU cash for weapons for Ukraine.
• But the rules of the game have not changed. This means that national vetoes, such as the Hungarian one, will be a crucial factor for future tranches. And that means the windfall may not end up in Ukraine by the summer after all.

Brief #2: NATO at 75 -- Aging But Still Agile?

What You Need To Know: On April 4, NATO celebrated 75 years. Manneken Pis, Brussels' iconic fountain statue of a little boy peeing, was decked out in a NATO costume, and the original Washington treaty, which established the military alliance in 1949, was flown to Brussels from the U.S. capital under tight security for the foreign ministers of the 32 NATO allies to admire.

But that was about as much fun as the aging military organization could manage for now. The foreign ministers were gathering on April 3-4, about three months before a crucial NATO summit in Washington on July 9-11. And, at their meeting, they dealt with the same issues that member-state leaders will in the summer -- the war in Ukraine and how NATO can shore up its support for Kyiv; Ukraine's prospects of NATO membership; and, finally, who should replace Secretary-General Jens Stoltenberg as he bows out after a decade at the helm later this year.

No decisions were made by the ministers on any of these issues last week -- a luxury that their bosses, at the July summit, can ill afford.

Deep Background: The most pressing issue is military support for Ukraine. With the U.S aid for Ukraine, worth nearly $60 billion, still stuck in Congress, Kyiv's European friends are scrambling to get whatever they can to their outgunned partner amid fears of a Russian offensive in the coming months penetrating Ukrainian defensive lines.

Still, the mood is slightly less grim than when I spoke to NATO officials earlier this year. "It's gloomy at the moment but not catastrophic. Russia is advancing a bit, albeit slowly," said one diplomat, who was not authorized to speak on the record. Earlier this year, the main issue was how to get artillery shells to Ukraine. While that issue is far from being resolved, NATO members are at least starting to churn them out domestically and procure them around the globe.

The glaring problem now is air defenses, especially missiles to protect Ukrainian cities and infrastructure. Unlike shells, missiles are not something that can be easily sourced outside the alliance or produced quickly in member countries. Before the meeting of the foreign ministers, Stoltenberg suggested a solution to the funding issue for the war effort in which NATO would give Ukraine a five-year military-aid package worth up to $100 billion.

Under Stoltenberg's plan, the money would be provided by all member states, with contributions based on the countries' gross national income (GNI), which is used to fund NATO's common budget. The question is whether all members will be on board by July, in time for the summit.

Drilling Down

• The secretary-general's proposal is very much part of what NATO officials refer to as the "institutionalization of Ukraine aid." In essence, this is NATO's attempt to take over various ad hoc initiatives to aid Ukraine. Consider the 50-country Ukraine Defense Contact Group (also known as the Ramstein format), which is now under U.S. leadership and meets almost monthly to provide Ukraine with arms. Or the F-16 coalition, a group of about a dozen NATO allies training Ukrainian pilots to handle the fighter jet.
• The military alliance is already facing obstacles, however, with one of them being Hungary. Budapest is against any move that would suggest that NATO is involved in a war, including the military alliance taking over the training of Ukrainian soldiers. There was an aim inside the organization to finalize a draft mandate for a Ukraine mission -- which would take over the various efforts to provide military aid -- at last week's meeting of foreign ministers, but the proposal is far from ready.
• There has also been little movement on Ukraine's potential membership in NATO. At the alliance's summit in Vilnius last year, it was agreed to do away with the Membership Action Plan (MAP) for Ukraine. The MAP is basically all the necessary political and military reforms that new members have to undertake before joining.
• But since then, Ukraine's path to possible membership has not been clearer, and there is no timeline. Eastern member states, such as those in the Baltic region, want to go beyond the "Vilnius language," but others, such as the United States and Germany, don't. Even if Ukraine did fulfill conditions for membership, such as anti-corruption and security-sector reforms, the elephant in the room is still the war. With almost no appetite for a direct war with Russia, membership is extremely unlikely as long as the fighting continues.
• That raises many questions: What can NATO offer, if anything, in Washington in July? Some sort of partial membership that only covers the territories that Kyiv has under its political control? Can or even should Kyiv accept such a deal that would de facto partition the country? And will all 32 members of the alliance agree to offer such a thing?
• And finally, there is the issue of replacing Stoltenberg. This was supposed to be wrapped up in early April with the big four -- France, Germany, the United Kingdom, and the United States -- officially backing outgoing Dutch Prime Minister Mark Rutte. In fact, most other members also appear to support Rutte's candidacy, including several eastern-flank countries such as Estonia and Poland.
• Hungary, however, is ardently against the Dutchman while Turkey, for now, is sitting on the fence. Some ministers raised it in Brussels last week and backed Rutte but there is no consensus yet -- plus there is another candidate, Romanian President Klaus Iohannis, who hasn't given up yet. Expect a lot of wheeling and dealing, which will likely drag on well into the summer.

Looking Ahead

There is expected to be a ruling on April 10 in the European Court of Justice on whether the sanctions against Russian businessmen Petr Aven and Mikhail Fridman should remain in place. In March, the Russian racing driver Nikita Mazepin, son of oligarch Dmitry Mazepin, won his case in the Luxembourg-based court, even though he remains listed for now. The EU can also still challenge the court's decision and present potential new evidence for the sanctions to remain in place.

That same day, the European Parliament will debate the recent Russian presidential election, which was without opposition and marred by fraud. Expect the revelation from last week that several European politicians, including some members of the European Parliament, were promoted or even paid by the pro-Russian news portal Voice of Europe to be brought up as well.

That's all for this week. Feel free to reach out to me on any of these issues on Twitter @RikardJozwiak, or on e-mail at jozwiakr@rferl.org.

Until next time,

Rikard Jozwiak

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