Regulation (EU) 2026/467 of the European Parliament and of the Council of 24 February 2026 implementing enhanced cooperation on the establishment of the Ukraine Support Loan for 2026 and 2027

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 212 thereof,

Having regard to Council Decision (EU) 2026/258 of 29 January 2026 authorising enhanced cooperation on the establishment of a Loan for Ukraine (1), and in particular Article 1 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure (2),

Whereas:

(1) On 24 February 2022, the President of the Russian Federation announced a ‘special military operation’ in Ukraine, and Russia’s armed forces began an unprovoked and unjustified war of aggression against Ukraine. That illegal war of aggression is a blatant violation of the territorial integrity, sovereignty and independence of Ukraine, as well as a violation of the prohibition on the use of force enshrined in Article 2(4) of the United Nations Charter, which is a peremptory rule of international law, and of the other principles of the United Nations Charter.

(2) Since the beginning of Russia’s unprovoked and unjustified war of aggression against Ukraine, the Union, its Member States and European financial institutions have mobilised unprecedented support for Ukraine’s economic, social, financial and defence resilience. That support combines support from the Union budget, including exceptional macro-financial assistance and support from the European Investment Bank and the European Bank for Reconstruction and Development, fully or partially guaranteed by the Union budget, as well as further financial support from Member States.

(3) Decision (EU) 2022/313 (3), Decision (EU) 2022/1201 (4), Decision (EU) 2022/1628 (5) and Regulation (EU) 2022/2463 (6) of the European Parliament and the Council collectively made available EUR 25 200 000 000 of macro-financial assistance to Ukraine throughout 2022 and 2023. That support constituted a major contributing factor to Ukraine’s macroeconomic and financial resilience at a critical time.

(4) Regulation (EU) 2024/792 of the European Parliament and of the Council (7) established the Ukraine Facility as an exceptional medium-term instrument that brings together the bilateral support provided by the Union to Ukraine, ensuring coordination and efficiency (the ‘Ukraine Facility’). Over the period from 2024 to 2027, the Ukraine Facility helps to address Ukraine’s financing needs and contributes to its recovery, reconstruction and modernisation needs, while at the same time supporting Ukraine’s reform effort as part of its path towards accession to the Union.

(5) Regulation (EU) 2024/2773 of the European Parliament and the Council (8) established the Ukraine Loan Cooperation Mechanism and provided exceptional macro-financial assistance to Ukraine. That assistance was the Union’s contribution as part of the G7 ‘Extraordinary Revenue Acceleration Loans for Ukraine’ (‘ERA Loans’) initiative, which collectively assisted in addressing Ukraine’s financing gap for 2025.

(6) Russia’s war of aggression against Ukraine has caused tremendous damage in Ukraine, with estimated recovery and reconstruction costs of EUR 506 000 000 000 as of 31 December 2024. Moreover, Ukraine has lost access to international financial markets and experienced a significant drop in public revenue, while public expenditure has increased substantially. Against that background, it can be envisaged that Ukraine will have substantive funding needs in the coming years.

(7) On 9 September 2025, Ukraine submitted an official request to the International Monetary Fund (IMF) for a new programme to cover additional financing needs from 2026 to 2029. That programme would succeed the successful implementation of the existing IMF programme, pursuant to which Ukraine has completed eight reviews, but takes into consideration that Russia’s war of aggression against Ukraine has continued. The IMF’s ability to proceed with the new programme is contingent upon receiving sufficient financing assurances from other partners, including the Union.

(8) Despite ongoing international efforts to broker a peaceful resolution to the conflict, the prolongation of Russia’s war of aggression against Ukraine has resulted in significant damage to Ukraine’s critical defence, civilian and energy infrastructure, necessitating the mobilisation of substantial additional resources to address Ukraine’s immediate financing needs.

(9) Russia’s war of aggression against Ukraine represents a strategic geopolitical threat to the Union as a whole and requires Member States to stand strong and united. It is therefore essential for Union support to be deployed rapidly and to be able to adapt flexibly for immediate relief and short-term rehabilitation on the way to future reconstruction.

(10) In line with the Articles on the Responsibility of States for Internationally Wrongful Acts, adopted in 2001 by the United Nations’ International Law Commission at its fifty-third session, and taken note of by the United Nations General Assembly in Resolution 56/83, and customary international law, Russia – as the responsible state – is under an obligation to make full reparation for the injury caused by its war of aggression against Ukraine.

(11) Council Decision (CFSP) 2022/335 (9) and Council Regulation (EU) 2022/334 (10) prohibit transactions related to the management of reserves as well as of assets of the Central Bank of Russia, including transactions with any legal person, entity or body acting on behalf of, or at the direction of, the Central Bank of Russia. In its conclusions of 27 June 2024, 17 October 2024 and 19 December 2024, the European Council has stated that, subject to Union law, Russia’s assets should remain immobilised until Russia ceases its war of aggression against Ukraine and compensates it for the damage caused by that war.

(12) In addition, Council Regulation (EU) 2025/2600 (11) prohibits the transfer of assets or reserves of the Central Bank of Russia on a temporary basis until Russia ceases its war of aggression against Ukraine, Russia provides reparations to Ukraine to the extent necessary to allow for reconstruction without adverse economic or financial consequences for the Union and Russia’s actions in the context of its war of aggression against Ukraine have objectively ceased to pose a serious risk of severe difficulties to the economy of the Union and its Member States.

(13) In its conclusions of 18 December 2025, the European Council agreed to provide a loan to Ukraine of EUR 90 000 000 000 for the years 2026 and 2027 based on Union borrowing on the capital markets backed by the Union budget headroom. The European Council’s conclusions also set out that, by means of enhanced cooperation pursuant to Article 20 of the Treaty on European Union (TEU), any mobilisation of resources of the Union’s budget as a guarantee for that loan will not have an impact on the financial obligations of the Czech Republic, Hungary and Slovakia. On the same date, 25 Member States agreed that the loan should be repaid by Ukraine only once reparations are received. Until then, the assets of the Central Bank of Russia should remain immobilised and the Union should reserve its right to make use of them to repay the loan, in full accordance with Union and international law. Those Member States underlined the importance of the following elements in relation to the loan: strengthening of the European and Ukrainian defence industries; Ukraine continuing to uphold the rule of law, including the fight against corruption; and the specific character of the security and defence policy of certain Member States and the security and defence interests of all Member States.

(14) On 29 January 2026, the Council adopted Decision (EU) 2026/258 authorising enhanced cooperation between Belgium, Bulgaria, Denmark, Germany, Estonia, Ireland, Greece, Spain, France, Croatia, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Austria, Poland, Portugal, Romania, Slovenia, Finland and Sweden on the establishment of a Loan for Ukraine.

(15) Given the financing position of Ukraine, the critical need for Ukraine to have the resources to counter Russia’s aggression and, where possible, to reconstruct, it is appropriate that the Union provide additional support to address Ukraine’s urgent financing requirements and facilitate the implementation of the IMF programme. To that end, it is appropriate to establish an instrument for providing Union support to Ukraine in 2026 and 2027 in the form of a loan to be repaid by reparations due by Russia (the ‘Ukraine Support Loan’).

(16) The Ukraine Support Loan should provide financial assistance to Ukraine in a predictable, continuous, orderly, flexible and timely manner with a view to supporting Ukraine in covering its financing and defence needs, in particular those resulting from Russia’s war of aggression against Ukraine. Specifically, the Ukraine Support Loan should support macro-financial stability in Ukraine and ease its external financing and support Ukraine’s defence industrial capacities through economic, financial and technical cooperation, thereby contributing to providing Ukraine a qualitative military edge.

(17) The Ukraine Support Loan should, subject to conditions, provide support to Ukraine in the form of a loan of up to EUR 90 000 000 000. In view of the principle of sound financial management, the Ukraine Support Loan should be made available by the Commission to Ukraine in instalments, which may be disbursed in one or more tranches.

(18) The support to Ukraine under the Ukraine Support Loan should be made available under the precondition that Ukraine continues to uphold and respect effective democratic mechanisms, including a multi-party parliamentary system and the rule of law, and to guarantee respect for human rights, including those of persons belonging to minorities. Upholding and respecting the rule of law should include the fight against corruption.

(19) The financial and economic assistance available under the Ukraine Support Loan should be made accessible to Ukraine in line with its financing needs. To that end, Ukraine should submit a Ukrainian Financing Strategy on its financing needs and sources. That Ukrainian Financing Strategy should contain the main information on Ukraine’s budget, financial and economic situation, as well as the support that Ukraine is receiving from the international community.

(20) The Commission should assess the Ukrainian Financing Strategy without undue delay and should act in close cooperation with Ukraine. Given the significant scale of Ukraine’s needs for both budget assistance and assistance for defence industrial capacities, as well as the constraints that some external partners have on the provision of their support, it is appropriate to establish an indicative distribution of the Ukraine Support Loan between those two financing needs. Whilst ensuring that Ukraine’s financing needs as calculated by the IMF for 2026 are fully addressed, that distribution should be indicative in order to reflect changing circumstances that may have an impact on Ukraine’s financing needs and to ensure that those needs continue to be addressed in a predictable, continuous, orderly, flexible and timely manner. In its assessment of the Ukrainian Financing Strategy, the Commission should consider the consistency of the expected external financing gap with that indicative distribution.

(21) In view of the importance of the financial effects of the measures imposed, implementing powers should be conferred on the Council which should act on the basis of a Commission proposal. The Council should approve the assessment of the Ukrainian Financing Strategy by means of an implementing decision, which it should endeavour to adopt without undue delay. That implementing decision should determine the amount of assistance to be made accessible to Ukraine to assist in the implementation of the Ukrainian Financing Strategy, including the amount for budget assistance and the amount for supporting Ukraine’s defence industrial capacities.

(22) Financial and economic assistance in the form of budget assistance should be made available with a view to supporting Ukraine in covering its financing needs. The financial and economic assistance under this Regulation should provide important input into Ukraine’s post-war economic recovery, long-term growth and prosperity all of which will have an important role to play in a future peace agreement. To ensure flexibility in addressing those needs, it is appropriate to use multiple means of delivery, where support should be able to be provided through macro-financial assistance and through a loan to be implemented pursuant to Chapter III of Regulation (EU) 2024/792.

(23) The Ukraine Facility is a medium-term instrument that has the objective to support Ukraine’s recovery and reconstruction, gradual integration into the internal market, as well as, inter alia, the adoption and implementation of the political, institutional, legal, administrative, social and economic reforms required to align to Union values and to progressively align to Union rules, standards, policies and practices (the ‘acquis’) with a view to future Union membership, thereby contributing to mutual stability, security, peace, prosperity and sustainability. It is therefore appropriate to provide for amounts stemming from the Ukraine Support Loan to be utilised through the Ukraine Facility. Chapter III of Regulation (EU) 2024/792 provides for financing to Ukraine upon satisfactory fulfilment of the conditions laid down in the Ukraine Plan, which sets out the reform and investment agenda of Ukraine. The Ukraine Plan should be updated to reflect that additional budget assistance, including measures to strengthen the rule of law and the fight against corruption.

(24) Macro-financial assistance should be linked to policy conditions to be set out in a Memorandum of Understanding (MoU). The MoU should include robust and ambitious reform commitments by Ukraine, including those to strengthen revenue mobilisation to support Ukraine’s financing needs and tackle the root causes of corruption in public finances, including via improving the sustainability and quality of public expenditure and enhancing the efficiency, transparency and accountability of the public finance management systems. It should be possible for such macro-financial assistance to be used by Ukraine to assist in the financing of compensation, as a form of reparation, to those individuals who have suffered damage from the illegal actions of Russia, including through the Claims Commission for Ukraine established under the auspices of the Council of Europe. The Council implementing decision approving the assessment of the Ukrainian Financing Strategy should establish the maximum number and indicative value of instalments for the macro-financial assistance. In view of the principle of sound financial management and to facilitate the Ukrainian authorities’ liquidity management and ensure predictability, there should, in principle, be a maximum of four instalments of that macro-financial assistance.

(25) In order to ensure uniform conditions for the implementation of this Regulation, and for reasons of efficiency, the Commission should be empowered to negotiate conditions for the macro-financial assistance with the Ukrainian authorities under the supervision of the committee of representatives of the Participating Member States (the ‘committee’) in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (12). Considering the potentially significant impact of assistance, it is appropriate that the examination procedure as specified in Regulation (EU) No 182/2011 be used. Taking into consideration the amount of the Ukraine Support Loan, the examination procedure should apply to the adoption of the MoU and to any reduction or cancellation of the Ukraine Support Loan.

(26) The Ukraine Support Loan should provide financial and economic assistance to Ukraine as a country at war, the financial stability of which is intrinsically linked to and depends on its ability to defend itself against Russia’s aggression. That justifies a specific amount of the financial and economic assistance to Ukraine being used to increase Ukraine’s capacity to cope with budgetary needs in relation to the capacity of Ukraine to strengthen its defence and military capabilities, thereby contributing to providing Ukraine with a qualitative military edge. That financial and economic assistance should aim to enable Ukraine to carry out urgent and major public investments in support of the Ukrainian defence industry and to facilitate its integration into the European defence industry in response to and following the current crisis situation. That financial and economic assistance should contribute, in particular, to the reconstruction, recovery and modernisation of the Ukrainian Defence Technological and Industrial Base, with a view to increasing its defence industrial readiness, taking into account its gradual future integration into the European Defence Technological and Industrial Base and through support for the timely availability of defence products and other products for defence purposes, through cooperation between the Union and Ukraine.

(27) Financial and economic assistance to support Ukraine’s defence industrial capacities should be made available for activities, expenditures and measures related to defence products or other products for defence purposes that meet certain eligibility criteria. In order to urgently reinforce the Ukrainian Defence Technological and Industrial Base in an efficient and autonomous manner, those eligibility criteria should be structured in a manner that directs the activities, expenditures and measures to support Ukraine’s defence industrial capacities towards the reconstruction, recovery and modernisation of the Ukrainian Defence Technological and Industrial Base, taking into account its gradual future integration into the European Defence Technological and Industrial Base. In that context, when examining whether manufacturers are controlled by third countries or third-country entities, control should be understood as the ability to exercise a decisive influence over a legal entity, directly or indirectly, through one or more intermediate legal entities.