When the U.S. issued sanctions against Russia in early 2014, they did so without international approval, and without a resolution from the United Nations. In essence, the Obama administration used the dollar as an economic weapon against the Eurasian power in response to their taking the Crimea after the U.S. backed rebels unlawfully overthrew the government in Ukraine.
However, in addition to these sanctions were pressures the U.S. placed on their allies and on their vassal states in Europe and the Far East, making the sanctions a full fledged proxy war that held European businesses stuck in the middle.
And as the economic sanctions on Russia near their third year in play, on Oct. 29, Russia’s upper chamber of their legislature approved a new bill that would make it legal for the government to confiscate foreign assets held within the country.
Russia’s upper chamber of parliament has approved a bill to allow retaliatory measures in response to the seizure of Russian assets abroad, the RIA Novosti news agency reported Wednesday.
The law gives authorities the power to limit the legal immunity of a foreign country and its property on Russian territory in response to similar restriction in that country.
It now awaits President Vladimir Putin’s signature before becoming law.
Under current legislation, Russian courts cannot seize assets belonging to foreign governments. According to Deputy Justice Minister Dmitry Aristov, this puts Russia in a weak position to protect its interests, the TASS news agency reported Wednesday.
Aristov said the introduction of the law become a priority following a number of “illegal” actions against Russia and its property overseas.
Earlier this year, Russian assets were seized in Belgium and France after the arbitration court in The Hague ordered Russia to pay $50 billion in compensation to former shareholders oil firm Yukos, which was dismembered in the mid 2000s after its owner, Mikhail Khodorkovsky, was jailed on charges of tax evasion. – Moscow Times
With the U.S. at odds with Russia over ISIS and the ongoing conflict in Syria, tensions have reached a point where property and assets everywhere in the world are in danger of confiscation or sanction by either side. And while this new legislation is meant to provide powers to President Putin as a last resort against Western aggression, it sets up the potential for Russia to collapse European nations by both confiscating assets, and even defaulting on loans.
When the world is in transition, and headed towards a new monetary or economic paradigm, geo-politics are often involved as the old system refuses to make way for the new. And with so many nations seeking an end to America’s polar control over finance and trade, and a return to economic nationalism without the need for a middleman, strong protections such as the one being passed in Moscow are often the only deterrent to keep further sanctions from being imposed.
Kenneth Schortgen Jr is a writer for Secretsofthefed.com, Examiner.com, Roguemoney.net, and To the Death Media, and hosts the popular web blog, The Daily Economist. Ken can also be heard Wednesday afternoons giving an weekly economic report on the Angel Clark radio show.