The European Union on Wednesday revealed details of its plan to use billions of euros in frozen Russian assets to fund Ukraine's needs over the next two years, but Belgium rejected the scheme and insisted that it poses major financial and legal risks.

European Commission President Ursula von der Leyen said that the EU would cover two thirds of Ukraine’s financial and military needs for 2026 and 2027, which the International Monetary fund puts at 137 billion euros ($160 billion), by providing 90 billion euros ($105 billion).

She said that other international partners would be called on to cover the remaining third.

"This is needed to keep the state and the basic services running, but also to continue enabling the brave resistance on the battlefield of Ukrainians," said von der Leyen while rolling out the proposal which would use Russian money as collateral to fund Ukraine’s economy and war effort through a “reparations loan.”

Von der Leyen said that using the frozen assets would strengthen the Ukrainian position at peace negotiations with Russia and the U.S. but it would also send a message to Moscow that prolonging the conflict would be costly.

She said that she had informed the Trump administration about the proposal.

EU leaders have committed to fund Ukraine over the next two years, whatever the method. The EU has already poured in over 170 billion euros ($197 billion) since the war started in 2022.

Von der Leyen said that should the loan plan not pass muster, the bloc could borrow the money on international markets in a scheme underpinned by its long-term budget. The problem here, though, is that it would require the approval of all 27 member countries, and Hungary has consistently blocked aid to Ukraine.

The biggest pot of ready funds available is through frozen Russian assets. Most of the money is held in Belgium – around 194 billion euros as of June – and outside the EU in Japan, with around $50 billion, and the U.S., U.K. and Canada with lesser amounts. A total of 210 billion euros worth ($245 billion) are held in Europe.

To address Belgian concerns, the commission's complex proposal includes safeguards to protect EU nations from “possible retaliation from Russia," a prohibition of any release of the frozen assets, and a way to borrow money as the EU to "underpin a loan to Ukraine.”

But Belgian Foreign Minister Maxime Prévot said that his country considered the option to be too risky.

Belgium fears that the Brussels-based financial clearing house holding the frozen assets, Euroclear, could take legal action if Russia challenges any use of the funds or if the move harms its image and business interests.

Prévot said Belgium feels that its concerns are not being heard by its EU partners.

In essence, the 90 billion euros would not be seized from Russia as such, as Kyiv would refund it once Moscow pays significant reparations for the massive destruction its war has caused. Should Moscow refuse, the assets would remain frozen.

Other EU partners insist that they too understand Belgium's worries.

Belgium has been earning some tax income on the assets, and the interest raised is also being used to fund a loan program for Ukraine organized by the Group of Seven major world powers.

The European Central Bank is worried that the plan for an EU reparation loan could undermine confidence in the euro single currency on international markets.

EU leaders are due to discuss the scheme and Ukraine's economic and military needs at a summit in Brussels on Dec. 18.