The UK government has announced its readiness to initiate legal proceedings against Russian billionaire Roman Abramovich to secure the release of £2.5 billion ($3.2 billion) from the 2022 sale of Chelsea Football Club. The funds, currently frozen in a UK bank account due to sanctions imposed on Abramovich following Russia’s invasion of Ukraine, were intended to support humanitarian efforts for war victims.
Background of the Dispute
In March 2022, amid escalating international sanctions against Russian oligarchs, Abramovich agreed to sell Chelsea FC. The sale was completed in May 2022 to a consortium led by American investor Todd Boehly and Clearlake Capital. At the time, Abramovich pledged that the net proceeds would be donated to a charitable foundation benefiting “All victims of the war in Ukraine”.
However, the United Kingdom government insists that the funds should be allocated exclusively to humanitarian aid in Ukraine. This divergence in intended use has led to a three-year stalemate, with the funds remaining inaccessible without approval from the Office of Financial Sanctions Implementation (OFSI).
Government’s Stance and Legal Threat
Chancellor Rachel Reeves and Foreign Secretary David Lammy have expressed deep frustration over the prolonged impasse. In a joint statement, they emphasized their commitment to ensuring the funds reach Ukrainian humanitarian causes and stated their willingness to pursue legal action if necessary:
“While the door for negotiations will remain open, we are fully prepared to pursue this through the courts if required.”
The government maintains that the funds, though legally belonging to Abramovich, are subject to sanctions and should be utilized to support those affected by Russia’s aggression in Ukraine.
Abramovich’s Position
Abramovich’s representatives have not publicly commented on the latest developments. Previously, they have argued that the UK government altered the terms of the agreement regarding the allocation of the funds, shifting from a broader interpretation of aiding “all victims” to focusing solely on Ukrainian beneficiaries.
The funds are held in a United Kingdom bank account and cannot be moved without a license from OFSI. The establishment of a charitable foundation to manage the funds has also faced delays, contributing to the ongoing deadlock.
Broader Implications
The situation highlights the complexities of enforcing sanctions and managing frozen assets in the context of international conflicts. The United Kingdom government’s firm stance may set a precedent for handling similar cases involving sanctioned individuals and frozen assets intended for humanitarian purposes.
As the legal and diplomatic efforts continue, the primary concern remains ensuring that the substantial funds from the Chelsea sale are directed to aid those suffering due to the war in Ukraine.
