Seizure of Russian State Assets and Support for Ukraine

1st reading
Tuesday 7th February 2023 Commons Chamber

Motion for leave to bring in a Bill (Standing Order No. 23)

14:01

[Sir Chris Bryant (Rhondda) (Lab)]

I beg to move,

That leave be given to bring in a Bill to require the Secretary of State to lay before Parliament proposals for the seizure of Russian state assets to provide support for Ukraine; and for connected purposes.

Maryinka in Donetsk, about 50 miles south-west of Bakhmut, used to have a beautiful, majestic basilica with a golden dome, named for our Lady of Kazan. It used to have a successful tyre factory. It used to have a population of 10,000, whose ancestors were Ukrainian Cossacks, Greeks and exiled Poles. It managed to survive sustained attack by Russian paramilitaries in 2014 and 2015. Today, however, it is a place of icy rubble, shelled-out apartment blocks, burnt trees, waterlogged trenches and machine gun posts, all under constant Russian bombardment. Not a single building remains standing. It has been pulverised, literally reduced to dust—obliterated—and yet, miraculously, Ukrainian defences hold on.

Maryinka is not alone. There is Bucha, and there is Mariupol. In Soledar, the junior and senior schools are reduced to shells. In Bakhmut, every single house along the main arterial road has become a crater. In Dnipro, an apartment block that was once home to 1,700 people has been destroyed. In Irpin, Yana and Serhiy Psariova’s 10th-floor two-bed apartment is a blackened shell, its roof ripped clean off and all its contents incinerated.

Ukraine is truly suffering. Up until 15 January 2023, since the second round of the invasion last year, the Office of the United Nations High Commissioner for Human Rights recorded 18,358 civilian casualties: 7,031 people killed and 11,327 injured, including 177 girls and 221 young boys. The UNHCR reckoned in September last year that 12.3 million people had left Ukraine and 7 million had been displaced internally. I think we all agree that Ukraine must win, but she must also be allowed to rebuild. By some miracle, some reconstruction is already happening—United24, for instance, is trying to raise £17 million to rebuild 18 apartment blocks in Irpin, Borodianka, Hostomel, Buzove and Mila to rehouse 4,237 people, and has raised £15.5 million so far—but this is not even the tip of the tip of the iceberg.

On 9 September 2022, a joint statement from the World Bank, the European Commission and the Government of Ukraine estimated that the current cost of reconstruction and recovery in Ukraine was $349 billion. In December the World Bank’s vice-president, Anna Bjerde, told the Austrian newspaper Die Presse that it was now closer to €500 billion to €600 billion, or $525 billion to $630 billion; and the figure is rising. Ukraine estimates that Russia has caused $1 trillion-worth of damage since the start of the full-scale invasion last February, and that is not even allowing for the costs in Crimea and parts of Donetsk and Luhansk, which were invaded in 2014. It estimates that 150,000 residential buildings, 1,500 schools and 20,000 km of roads have been destroyed.

Someone has to pay, and there are only three options. First, there is Ukraine herself, but her economy is projected to be 25% smaller this year than last. Secondly, there are her allies. The United States has committed tranches of $40 billion and $12.3 billion, and a further amount is coming soon. We in the UK have set aside, I think, £3.4 billion, and so far the European Union has found roughly €50 billion. Individuals have been generous too: German families gave €5.7 billion last year. There are plans for a donors’ conference to take place soon, hosted by the UK, and I hope it will be very successful.

Thirdly, there is Russia’s own debt to Ukraine. Russia is truly a great nation, with a phenomenal history and culture and extraordinary people, but this is a war of aggression, and I hope that individuals—including those at the very top of the army and of the Government—will face justice in the Ukrainian courts or at an international war crimes tribunal. My Bill simply requires the British Government to present plans to seize the assets belonging to the Russian Federation which are already frozen in the UK because of the sanctions we have imposed, and allocate them to Ukraine and the Ukrainian people.

I can, of course, hear objections. What about the international rule of law? Yes, on the whole it is not a good idea for Governments to seize others’ assets. That is the kind of thing we would expect Vladimir Vladimirovich Putin to do. The right to property is fundamental to the rule of law. However, it is never absolute: the law reserves the right to fine and to deprive people of ill-gotten gains in certain circumstances. Moreover, that argument would apply more clearly to the seizure of individuals’ assets—the assets of the Russian oligarchs who obtained their money through their crony relationship with Putin or through criminality—but I am not talking about those; I am talking only about Russian state assets.

So what about sovereign assets, I hear you ask. Are they not normally protected by the concept of sovereign immunity? Yes, but very few countries now consider that to be an absolute immunity, and there have been many exceptions, for instance to meet damages awarded by international courts and arbitral tribunals. The UK’s State Immunity Act 1978 expressly restricts sovereign immunity. I would argue that Russia’s continuing refusal to comply with international human rights law by attacking civilian housing and infrastructure, and its wilful refusal to follow orders of the International Court of Justice and the United Nations General Assembly, are ample grounds for the creation of such an exemption.

What about the possibility of Russia’s seizing UK state assets in retaliation? Well, I very much doubt that we have any state assets in Russia— I certainly hope we do not—and it is time that UK businesses, including Unilever, BP and Infosys, completely withdrew from Russia. What about the possibility of sovereign wealth funds of other countries deciding to divert their assets from the UK for fear that we should seize them, if we were to proceed in this manner in relation to Russia? Well, the only precedent that we are setting here is that if a state invades another self-governing state and thereby wages a war of aggression against it, we shall not just freeze but seize its assets. We would all worry if we thought that another state was contemplating such action, and the very fact of our doing this might well make authoritarian regimes pause before going down such a dangerous route. I would therefore argue that it is good law, not bad law, to take this action.

But here is the main point. This is a political decision, not a legal one. Nearly $350 billion of Russian Central Bank reserves have been frozen by democratic countries around the world, and £26 billion of that is frozen in the United Kingdom. Canada, Italy, the European Union and the United States are all considering action. It is the very least we owe the people of Ukraine. Russia has forfeited its rights to these assets. It owes Ukraine far more than money; it owes it blood.

This Bill has the support of the Chairs of the Defence and Foreign Affairs Committees, a majority of members of the Foreign Affairs Committee, the former leader of the Conservative party, members of the SNP, the Liberals and the Labour party, including the hon. Member for Bermondsey and Old Southwark (Neil Coyle), my hon. Friends the Members for Warwick and Leamington (Matt Western), for Nottingham East (Nadia Whittome), for Sheffield Central (Paul Blomfield) and for Rochdale (Tony Lloyd), the hon. Members for East Worthing and Shoreham (Tim Loughton), for Strangford (Jim Shannon), for Witney (Robert Courts) and for Crawley (Henry Smith), my hon. Friends the Members for Blackley and Broughton (Graham Stringer) and for Wallasey (Dame Angela Eagle) and the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry). Even more importantly, the Ukrainian ambassador has asked me to say that he and his nation support this Bill.

I am not naive. I would love the Government to take up the Bill, give it time and get it on the statute book by the end of this Session, but I know that Governments just do not work like that. They do not like doing that kind of thing. I note, however, that the Security Minister indicated yesterday that the Government were looking at this issue with their allies and that the Defence Secretary has said that if we cannot do this, he wants to know why. I have spoken to the Chancellor and the Justice Secretary about it, and I hope that if the House unanimously agrees that the Bill can proceed today, the Government will hear loud and clear that we think now is the time to act.

I will end with some verses:

“Drop everything and run away

leave your house, your cellar with apricot jam jars

and pink chrysanthemums on the terrace

shoot your dogs, so they don’t suffer

abandon this land, just go

he says: don’t talk nonsense, we throw dirt on coffins daily

he says: everything will be fine, salvation will come soon

he says: the humanitarian aid is on the way.”

My question is: is it?

[Mr Deputy Speaker (Mr Nigel Evans)]

This would be the time for anyone who wishes to oppose the 10-minute rule Bill to indicate that. I have had no such notification and I see none.

Question put and agreed to.

Ordered,

That Sir Chris Bryant, Sir Iain Duncan Smith, Dame Margaret Hodge, Liam Byrne, Sir Robert Buckland, Alicia Kearns, Layla Moran, Joanna Cherry, Colum Eastwood, Stella Creasy, Chris Grayling and Mr Tobias Ellwood present the Bill.

Sir Chris Bryant accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 24 February, and to be printed (Bill 245).

Seafarers’ Wages Bill [Lords] (Programme) (No. 2)

Ordered,

That the Order of 19 December 2022 (Seafarers’ Wages Bill [Lords]: Programme) be varied as follows:

(1) Paragraphs 4 and 5 of the Order shall be omitted.

(2) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion two hours after the commencement of proceedings on the Motion for this Order.

(3) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion three hours after the commencement of proceedings on the Motion for this Order.—(Mr Richard Holden.)