Hungary has initiated legal proceedings against the European Union regarding the bloc’s decision to allocate proceeds from frozen Russian assets for military assistance to Ukraine. The European Court of Justice announced on August 25 that it has officially accepted Budapest’s lawsuit, paving the way for a significant legal confrontation within the EU.
Central to this case is the Council of the EU’s decision in 2024 to allocate billions of euros in interest accrued from Russian sovereign assets to the European Peace Facility (EPF), which serves as the union’s primary defense aid mechanism.
In its legal submission, Hungary seeks to have this decision annulled, along with a ruling from March 2025 by the EPF that authorizes the direct use of these funds for purchasing weapons and military equipment for Ukraine.
Hungarian officials assert that their government abstained from the initial vote that permitted the utilization of Russian assets. They argue that the EU’s subsequent interpretation, which suggests that abstention equated to no veto and permitted the disbursement of funds without Budapest’s consent, infringes upon their rights within the union’s decision-making process.
The disputed arrangement, which was enacted in February, allocates 99.7% of the annual interest from frozen Russian assets to Ukraine, with estimates ranging from €3 to €5 billion ($3.5 to $5.8 billion) each year. Western nations have immobilized approximately $300 billion in Russian sovereign wealth following Moscow’s full-scale invasion of Ukraine, with around two-thirds of that amount held in European institutions.
This lawsuit arises as Hungary remains the most pro-Moscow government within the EU. Prime Minister Viktor Orban has consistently opposed sanctions against Russia, resisted military support for Kyiv, and hindered progress on Ukraine’s accession negotiations.
His position has resulted in ongoing conflicts with other EU members who consider continued support for Ukraine vital in countering Russian aggression.
Tensions have recently escalated following reports that US President Donald Trump influenced Orban to remove his veto on discussions regarding Ukraine’s EU membership. However, the Hungarian government remains steadfast in its opposition to the utilization of frozen Russian assets, underscoring Budapest’s resolve to exert influence over EU policy in this area.
By initiating legal action against the EU, Hungary is not only disputing the financial framework supporting Ukraine’s war efforts but is also questioning the power dynamics within the bloc, examining whether abstention should be interpreted as implicit approval or as a basis for a veto. The result of this case could establish a precedent for future decisions concerning collective defense funding in Europe.
