Chelsea FC owner Roman Abramovich is reportedly worth $18 billion. Photo / AP
Chelsea FC owner Roman Abramovich is reportedly worth $18 billion. Photo / AP
Roman Abramovich is among seven Russian oligarchs to be added to the UK sanctions list, the Government has announced.
The owner of Chelsea Football Club will face a ban on all transactions with UK individuals and businesses, a travel ban and transport sanctions.
Igor Sechin, Oleg Deripaska and Dmitri Lebedev have also been included.
"There can be no safe havens for those who have supported Putin's vicious assault on Ukraine," Boris Johnson said.
"Today's sanctions are the latest step in the UK's unwavering support for the Ukrainian people. We will be ruthless in pursuing those who enable the killing of civilians, destruction of hospitals and illegal occupation of sovereign allies."
Mr Deripaska has stakes in En+ Group, Mr Sechin is the chief executive of Rosneft and Mr Lebedev is chairman of the Board of Directors of Bank Rossiya.
Government wants to take Russian economy 'out at the knees'
An anti-Russian invasion demonstrator holds a sign with the message 'Abramovich can not be Portuguese', outside the Russian embassy in Lisbon. Photo / AP
Roman Abramovich has been sanctioned in part because of his links to a metals firm that may have provided steel to the Russian military to build tanks.
The oligarch is cited in the Government's financial sanctions register as having a significant shareholding in, and exercising effective control over, the steel manufacturing and mining company Evraz Plc.
It states: "Abramovich is or has been involved in destabilising Ukraine and undermining and threatening the territorial integrity, sovereignty and independence of Ukraine, via Evraz Plc…
"Evraz Plc is or has been involved in providing financial services, or making available funds, economic resources, goods or technology that could contribute to destabilising Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine – which includes potentially supplying steel to the Russian military which may have been used in the production of tanks."
The document, published by the Treasury's Office of Financial Sanctions Implementation, states that Mr Abramovich "is or has been involved in obtaining a benefit from or supporting the Government of Russia", as he and the metals and mining company "carry on business in sectors of strategic significance to the Government of Russia – namely the construction, defence and extractive sectors".
It also cites the "pro-Kremlin" oligarch's "close relationship for decades" with Vladimir Putin and asserts that he has received "preferential treatment and concessions" from the Russian President and government.
The new sanctions announced today form part of a Government strategy to take the Russian economy "out at the knees" and curb funding of the "Putin war machine".
A Foreign Office source told The Telegraph: "Liz [Truss] and the Government's strategy is to debilitate the Russian economy - taking it out at the knees.
"The people sanctioned today have a huge amount of wealth. Abramovich is the most familiar name for the UK audience, but the likes of Deripaska and Sechin are huge financial figures in Russia.
"This is part of a strategy that targets banks, financial institutions, defence companies and really puts the squeeze on the Russian economy and what funds the Putin war machine, to ensure he fails in Ukraine, especially if this conflict goes medium to long term."
It is also designed to send "a signal that no-one and nothing is off the table in terms of sanctions now and in the future", the Whitehall insider said.
Britain's aim to isolate Russia economically by making it difficult for oligarchs and state companies to operate outside the nation's border dovetails with the UK's diplomatic isolation of Moscow at the United Nations.
Chelsea fans in the stands at Stamford Bridge. Photo / AP
The Government has told Chelsea it cannot even sell tickets to matches and any takeover is now on hold as part of the order.
The club will still be able to pay staff, including players, and broadcasters will be allowed to show Chelsea matches.
A result of the sanctions, a club sale can only go through if the Government grants permission. Other key points for Chelsea in the order include:
• Chelsea are now under under an effective transfer embargo, with new loans and permanent deals banned • Existing loans/transfer deals can still be paid • Broadcast and prize money can be received but will be frozen • Merchandising sales may continue but money cannot go to Chelsea • The club is limited to £20,000 travel expenses per match • There is also a limit to £500,000 on security, stewarding and catering costs per match • No new ticket sales - season ticket holders and existing ticket holders only • No stadium work or redevelopment
The club released a statement this afternoon, confirming they have been issued a "general licence" to continue "certain activities" but said they will seek to negotiate with the government to get the terms changed.
"We will fulfil our men's and women's team fixtures today against Norwich and West Ham, respectively, and intend to engage in discussions with the UK Government regarding the scope of the licence," the statement read.
"This will include seeking permission for the licence to be amended in order to allow the Club to operate as normal as possible. We will also be seeking guidance from the UK Government on the impact of these measures on the Chelsea Foundation and its important work in our communities."
The Chelsea megastore was immediately closed on Thursday "until further notice", and there is doubt that both a hotel and carpark within the Stamford Bridge complex will be allowed to stay open.
The Chelsea Supporters Trust released a statement following the news, saying :"The CST notes with concern the Government's statement regarding the owner. Supporters MUST be involved in any conversation regarding ongoing impacts on the club and its global fan base."
"The CST implores the Government to conduct a swift process to minimise the uncertainty over Chelsea's future, for supporters and for supporters to be given a golden share as part of a sale of the club."
The Premier League have confirmed Chelsea's fixture against Norwich will go ahead.
"The League will now work with the club and the Government to ensure the season will proceed as planned and in line with the Government's intention," the statement read.
For Chelsea, there could now be uncertainty over the £1.5billion worth of loans which have been pumped into the club since he purchased it in 2003.
He had promised to write off the loans after putting the club up for sale last week, with proceeds going to "all victims of the Ukraine war".
A view of Chelsea football club's Stamford Bridge stadium in London. Photo / AP
Chelsea's financial ecosystem is heavily reliant on handouts from Mr Abramovich. Matchday revenue is dwarfed by some rivals largely due to his decision in 2018 to shelve a £1billion stadium redevelopment.
The loans are due to be repaid to Camberley International Investments Ltd, a British Virgin Island entity. It is certain that fund is owned by Mr Abramovich, but more detail is elusive given the source's offshore status.
Despite calls in parliament for Mr Abramovich to face action in recent weeks, the announcement by the Government appears to have come as shock to the club.
In a bid to ease fan uncertainty around the future of the club, the Government issued a briefing note stating it remains "open to a sale".
"While the current licence does not permit the sale of the club at this time, the Government is open to a sale of the club and would consider an application for a new licence to allow for a sale," a statement said. "Proceeds from any sale could not go to the sanctioned individual while he is subject to sanctions."
A spokesperson for the Russian was unable to comment. It is unclear whether he has now halted the process of speaking to potential club buyers.
Mr Abramovich is described by the Foreign Office in a new statement on the sanctions as "one of the few oligarchs from the 1990s to maintain prominence under Putin".
Nadine Dorries, the Culture Secretary, has said that Chelsea will still be able to play matches and pay staff.
"Our priority is to hold those who have enabled the Putin regime to account. Today's sanctions obviously have a direct impact on Chelsea and its fans. We have been working hard to ensure the club and the national game are not unnecessarily harmed by these important sanctions," she said.
"I know this brings some uncertainty, but the Government will work with the league and clubs to keep football being played while ensuring sanctions hit those intended. Football clubs are cultural assets and the bedrock of our communities. We're committed to protecting them."
Mr Abramovich has been to Stamford Bridge just once - in November last year - since he withdrew an application for a UK visa in 2018, so the travel ban is unable to cause him much of a headache.
As well as Chelsea, he has stakes in steel giant Evraz and Norilsk Nickel. He sold a 73 per cent stake in Russian oil firm Sibneft to state-owned gas titan Gazprom for £9.87 billion in 2005. His net worth is an estimated £9.4 billion (NZ$17 billion).
Jets and yachts owned or chartered by Mr Abramovichcan been seized, the sanctions say.
'The blood of the Ukrainian people is on their hands'
The seven who have been sanctioned have a combined net worth of more than £15billion, the Government said in a press release announcing the move.
Liz Truss, the Foreign Secretary, said: "Today's sanctions show once again that oligarchs and kleptocrats have no place in our economy or society. With their close links to Putin they are complicit in his aggression.
"The blood of the Ukrainian people is on their hands. They should hang their heads in shame."
Labour leader Sir Keir Starmer said he was pleased the government had sanctioned Mr Abramovich, but they had been "too slow" to do so.
Speaking on a trip to Estonia, Sir Keir said: "I'm slightly frustrated, we called for this weeks ago and whilst we're very supportive of the action the Government has taken on sanctions, there are echoes of Afghanistan here. We need to go further and faster on this."
"I called for these sanctions against Abramovich two weeks ago now and a feature of the Government's reaction here is that they are too slow."
Chris Bryant, the Labour MP for the Rhondda who has led a lot of the pressure on this, wrote: "Well done finally on sanctioning Roman Abramovich and freezing his assets. Now let's move on other Putin oligarchs as fast as possible so they can't squirrel their assets out of reach."
James Cleverly, Europe minister, said: "Putin is a global pariah but there is nowhere to hide as we go further and act more strongly in partnership with our allies. In the coming days and weeks we will continue to impose further sanctions to starve the Kremlin's war machine of its funding."
David Lammy, the shadow foreign secretary, wrote: "At last! This is the right decision. But it shouldn't have taken the government weeks. Too few oligarchs linked to Putin's rogue regime have faced sanctions from the UK. We are lagging behind the EU and the US. The government must finally close the sanctions gap."
