The government has said it will take further action after former Chelsea football club owner Roman Abramovich missed a recent deadline to donate billions from his sale four years ago to a new charity.
In December, the government issued a licence to permit the transfer of over £2.5bn in proceeds from Chelsea FC’s sale into a foundation for humanitarian purposes in Ukraine.
This could create one of the 10 largest charities in the UK by assets, if it were registered in this country.
Abramovich pledged to donate money to victims of the conflict in Ukraine when he sold the club in 2022, but it remains held by his private company Fordstam Ltd.
The Russian billionaire, who was sanctioned in the UK shortly before the Chelsea sale in 2022, missed the government’s latest deadline to transfer the money on Tuesday this week.
“We gave Roman Abramovich his last chance to do the right thing. Once again, he has failed to make the donation he committed to,” a government spokesperson said.
“We will now take further steps to ensure that the promise he made at the time of the Chelsea sale is kept.”
The government has written to Abramovich’s legal team following the missed deadline and is prepared to go to court if necessary.
£2.5bn amount challenged by Abramovich’s firm
The government has said its licence issued to Abramovich in December last year permits the full sale proceeds, £2.54bn according to Fordstam’s accounts, to a new foundation.
However, the company’s latest accounts say £150m of this is being held by Chelsea FC’s new owners, BlueCo 22, until next year when it will be transferred to Fordstam. It also says £41.6m was spent on transaction fees, meaning Fordstam received £2.35bn initially from the sale in 2022.
Fordstam also claims in its accounts that it owes £1.43bn loaned to it by another of Abramovich’s companies called Camberley International Investments Limited.
Camberley International Investments is subject to a criminal investigation by the Attorney General of Jersey “into whether certain assets (potentially including the net proceeds) amount to the proceeds of crime”, the accounts read.
Fordstam therefore states that it only intends to transfer the remaining “net gain on sale of £987m” to charitable causes.
This is despite Abramovich claiming in 2022 that “all net proceeds from the sale will be donated” and that he would not ask for loans to be repaid.
Abramovich’s business associate and former Chelsea FC director Eugene Tenenbaum, who was also sanctioned in 2022, serves as a common director of both Fordstam and Camberley International Investments, the accounts state.
‘Inaction and obfuscation’
Charity sector bodies bemoaned the delay in releasing the money for charitable causes.
Alison Griffin, head of conflict and humanitarian campaigns at Save the Children UK, said the government’s potential court action was a “significant development”.
“However, we are deeply concerned that this will only further delay the release of these much-needed funds to help support victims of the war in Ukraine,” she said.
“All who have a say in this have had ample time to come together and reach an amicable agreement that would see the funds released.
“And yet the history of the Chelsea fund has been marked by inaction and obfuscation.
“Reticence from all parties to get around the table – or even exchange emails – has meant that we are no closer to the funds reaching those who need it most almost four years since the money was donated.
“We are calling on all parties, including the government, Roman Abramovich, and the foundation set up to disburse the funds, to actively work to avoid the need for a long-drawn-out court case where all victims of the war, especially children, lose.”
A spokesperson for NGO umbrella body Bond said: “The back and forth on the release of the Chelsea FC funds has been going on for four years with two governments.
“The longer the funds are tied up in a bank account, the more those whose lives are impacted by war and conflict around the world suffer.
“We urge the government to issue a new license that can unlock much-needed funding for those impacted by conflict around the world.”
