‘With a disagreement hindering the allocation of funds from the Chelsea sale, assistance for Ukraine victims is being obstructed.’

The government has acknowledged that funds generated from the sale of Chelsea are being prevented from being used to assist victims of the war in Ukraine due to a “disagreement” with Roman Abramovich.

Over 18 months after Abramovich sold Chelsea to American investors, the proceeds of £2.5bn from the deal remain frozen in a UK bank account. On Tuesday, Leo Docherty, the minister for Europe, stated that the money release process is still stuck, as the two parties disagree on where and how it should be allocated.

While speaking to the European affairs committee in the House of Lords, Docherty revealed that no application has been submitted yet for a license that would allow the frozen funds to be utilized. “A license that enabled the freezing of the funds has been renewed and remains in effect,” Docherty said. “A second license would need to be agreed upon, but there is a disagreement between the fund’s administrators and the government. We cannot speculate on the intentions of the other side. It is their responsibility to apply for a license under the terms of the unilateral declaration.”

The unilateral declaration was a public statement issued by the government on May 30th of the previous year, a week after granting the initial license for the Chelsea sale. The declaration outlined the conditions under which a charitable foundation could potentially use what has been described as the largest humanitarian fund in history. According to the declaration, “the Treasury will only issue a license that ensures the proceeds are used exclusively for humanitarian purposes in Ukraine.”

Docherty admitted to the committee that Abramovich and those entrusted to manage the foundation have a different interpretation of the fund’s mandate. “The main difference between the government and the foundation’s establishment lies in whether the funds are utilized within Ukraine or for Ukrainians residing outside of Ukraine. This is something that still needs to be resolved,” Docherty explained.

Why the disagreement has not been resolved yet remains unanswered. Experts in sanctions law argue that if Abramovich has failed to comply with the terms of the initial license, he could potentially face criminal charges or significant financial penalties. Representatives of Abramovich have indicated to the Guardian that the terms of the initial license were not aligned with the language of the unilateral declaration and did allow for funds to be used outside Ukraine.

Publicly, the government has not hinted at taking action against Abramovich to facilitate the establishment of the foundation, and Docherty did not outline any potential next steps to the committee. Nonetheless, the minister reiterated the government’s desire to see the issue resolved. “We want this to be resolved as quickly as possible,” he emphasized. “We are actively pushing for it.”

Leave a Reply

Your email address will not be published. Required fields are marked *