On 1 October in Copenhagen, EU heads of state and government discussed a proposal that could fundamentally transform European foreign policy. The €140 billion “reparations loan” to Ukraine, announced by Ursula von der Leyen on 9 September during her State of the Union address, represents more than emergency wartime financing. To bypass Hungary’s inevitable veto, the loan’s terms could be decided by qualified majority within the Council of the European Union—potentially ending decades of paralysis caused by the unanimity rule in common foreign and security policy.
The loan would be secured against approximately €185 billion in Russian assets frozen at Euroclear, the European clearing house in Brussels. This mechanism effectively mobilises these funds without direct expropriation—a crucial distinction for European governments worried that outright seizure would undermine the euro’s attractiveness as a reserve currency. Ukraine would only repay the loan once Russia pays reparations, with the money financing both military operations and essential budgetary needs.
Doubling support without taxpayer burden
This loan offers the EU an extraordinary opportunity: nearly doubling European aid to Ukraine without adding a single euro to already stretched national budgets. Since 2022, Europeans have provided €167 billion in support, according to the Kiel Institute. Yet American financial aid has been frozen for months, with no prospect of release in sight. The need for European action has never been more urgent.
The obstacle, predictably, is Hungarian Prime Minister Viktor Orbán. For nearly four years, he has systematically obstructed European support for Ukraine, extracting costly concessions through lengthy negotiations before occasionally relenting. His most damaging success has been completely paralysing the European Peace Facility’s military aid programme. Six billion euros earmarked for Ukraine remain undisbursed after more than a year, leaving only bilateral national assistance in the military sphere.
How can the EU prevent Orbán—potentially supported by Slovakia’s Robert Fico—from derailing this vital project or delaying it for precious months?
Article 7 of the Treaty on European Union permits stripping a member state of voting rights for “serious and persistent breach” of EU values. Yet this requires unanimous agreement, and many members hesitate to deploy this “nuclear option”. Could the process succeed if based not on violations of democracy and rule of law, but on breaching geopolitical solidarity—essentially, collusion with the enemy? The Jacques Delors Centre in Berlin recently proposed this approach.
But there exists another path through the apparent impasse. While common foreign and security policy typically requires unanimity, Article 31 of Title 5 contains crucial exceptions. The Council may act by qualified majority when:
- Adopting decisions that define Union actions or positions based on European Council determinations about strategic interests and objectives
- Adopting decisions proposed by the High Representative following specific European Council requests
- Implementing any decision that defines a Union action or position
The qualified majority breakthrough
According to Politico, European officials plan to invoke these provisions for the reparations loan. By framing the loan’s legal framework as implementing measures for existing Council decisions on frozen Russian assets, they can approve it through qualified majority voting, circumventing Hungary’s veto.
This treaty provision has long existed, its potential discussed in European corridors, but never deployed. Member states feared losing their own future veto power, as Article 31’s possibilities for bypassing unanimity prove remarkably broad once activated. They also worried the European Council would bog down in detailed discussions if it became the sole venue for exercising vetoes.
Yet with existential threats facing the Union and certain member states effectively aiding Europe’s adversaries, the time has come to grant the EU genuine foreign and security policy capability by curtailing unanimity’s scope.
If this procedure succeeds for the reparations loan—and survives inevitable Court of Justice challenges—we will witness a Copernican revolution in common foreign and security policy. Should this approach then generalise, as Article 31 permits, the European Union would gain the agility essential for survival in this critical domain, all without amending the treaty.
The stakes extend far beyond Ukraine’s immediate needs. This moment could determine whether the EU remains hobbled by its least committed members or finally develops the capacity to act decisively in defending European interests and values. The reparations loan may prove the catalyst that transforms European foreign policy from a hostage of unanimity into an instrument of collective strength.
Originally published in French by Institut Jacques Delors
Guillaume Duval is adviser to the Jacques Delors Institute, former editor-in-chief of Alternatives Economiques and former speechwriter of HRVP Josep Borell.
