Le Maire, speaking after a G7 finance officials meeting, rejected the U.S. position outright and said France was convinced that there was no sufficient basis in international law to proceed, and further work was required.

He said any such moves should be fully underpinned by international law and required the support of all members of the Group of 20 major economies - which includes Russia, China and other countries that have been critical of the United States.

G7 officials have been struggling for a year to find agreement on what to do with Russian sovereign assets immobilized after Moscow's invasion of Ukraine in February 2022, and G7 leaders have asked for possible solutions by June.

Their debate this week on the sidelines of a meeting of finance ministers from the G20 major global economies in Sao Paulo showed there is still a fair distance to cover.

Yellen told reporters on Tuesday there was "a strong international law, economic and moral case" for deriving value from the Russian assets, whether by seizing them outright or using them as collateral, and said the "countermeasures theory" justified such action under international law.

Yellen underscored the urgent need to move forward to help Ukraine, which has faced military setbacks in its now two-year battle against Russia's invasion.

Le Maire, asked specifically about the countermeasures theory, said he disagreed.

"We don't think this legal basis is sufficient," he said, underscoring the importance of the rule of law - and broad international consensus - in finding a solution.

"This legal basis must be accepted not only by the European countries, not only by the G7 countries, but by all the member states of the world community, and I mean by all the member states of the G20. We should not add any kind of division among the G20 countries," he said.

Russia has threatened major retaliation if the West proceeds with seizing the assets.

Le Maire argued that the European Union using windfall profits from the frozen assets already marked a significant step forward, a view echoed by German Finance Minister Christian Lindner.

Lindner told reporters he favors using the interest accrued from frozen Russian assets to support Ukraine in its war against Moscow, calling it a "realistic step that is legally secure and which can be implemented quickly."

Washington supports the windfall tax idea, but argues more significant action is justified, given the egregious nature of Russia's invasion.

Canada agreed on the urgent need to move forward with confiscating frozen Russian sovereign assets to help Ukraine, Finance Minister Chrystia Freeland said on Tuesday.

Freeland said she had a long conversation with Yellen over the weekend about the issue, adding "She and I agree 100%."

The issue has grown in importance since $61 billion in further U.S. aid to Ukraine has been blocked by the Republican-led U.S. House of Representatives.

However it could take a year or more to unlock value from the assets, experts said. Most, if not all, countries that hold Russian assets, would need to pass domestic legislation to make the actions possible.

Yellen on Tuesday acknowledged there were risks involved, but downplayed concerns raised by some Europeans that seizing Russian assets would undermine the role of the U.S. dollar, euro or Japanese yen as important global reserve currencies.

(Reporting by Andrea Shalal and Christian Kraemer; Editing by Brad Haynes and Alistair Bell)

By Andrea Shalal and Christian Kraemer