Roman Abramovich has had his assets frozen by the UK government, leading to questions over how the situation will affect Chelsea
Less than a month after winning the FIFA Club World Cup, Chelsea have had their future thrown into uncertainty after owner Roman Abramovich was sanctioned by the UK government in wake of the Russian military operation in Ukraine.
Here, we examine what Abramovich’s UK assets freeze means for the west London club moving forward.
What do the sanctions against Abramovich state?
After increased pressure to act against Abramovich, the UK government released a 42-page document in which the 55-year-old was the second name on a list of persons and entities sanctioned with their assets frozen on British shores.
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The document described the businessman as a “pro-Kremlin oligarch” who is allegedly “associated with a person who is or has been involved in destabilizing Ukraine and undermining and threatening the territorial integrity, sovereignty and independence of Ukraine, namely Vladimir Putin, with whom Abramovich has had a close relationship for decades.”
“This association has included obtaining a financial benefit or other material benefit from Putin and the Government of Russia,” the UK government alleged.
Abramovich has consistently rejected any connections with Russian President Putin and denies that he has any reason to be sanctioned.
UK Culture Secretary Nadine Dorries tweeted that the sanctions are a way of “depriving Abramovich of benefiting from his ownership of the club.”
Dorries added that this “brings some uncertainty” but that the British government “will work with the league and clubs to keep football being played while ensuring sanctions hit those intended.”
Can Abramovich sell Chelsea, and is there is still interest from potential buyers?
In the initial aftermath of Russia’s military operation in Ukraine, Abramovich handed over “stewardship and care” of the club to its trustees, before confirming he would sell the outfit he has owned since 2003.
It was believed that the Russian’s asking price was between £3-4 billion ($4-5.3 billion), but that he may be willing to listen to lower offers for a quick sale given the likelihood of impending sanctions which have now come to fruition.
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While it was first suggested that any sale would now be blocked due to Abramovich’s assets freeze, The Telegraph has detailed how a sale could go ahead if the UK government approves it, and if Abramovich does not benefit financially in any way.
It remains unclear as to whether British authorities would give the green light to a sale while Russia’s military operation in Ukraine continues.
Abramovich previously pledged to donate any net proceeds from the deal to “all victims” of the conflict.
Parties to declare an interest in buying Chelsea include British property tycoon Nick Candy, part-LA Dodgers owner Todd Boehly and Swiss billionaire Hansjorg Wyss and their consortium, plus Turkish businessman Muhsin Bayrak.
The Telegraph also says that one of the prospective buyers has insisted their interest remains “just as strong as it was” while they are hopeful a solution can be found to the dilemma. Elsewhere it has been suggested that Abramovich’s original asking price could be lowered in light of the sanctions.
Can Chelsea still play matches and sell tickets?
Chelsea have been granted a ‘special license’ for fixtures which expires on May 31, but can vary or be revoked or suspended at any moment.
Costs are capped at £500,000 ($660,000) per match for security, stewarding and catering outlay, while just £20,000 ($26,000) can be set aside for travel expenses when playing away from home in the Champions League and domestically on the road in the Premier League and FA Cup.
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Chelsea cannot sell extra tickets to their fixtures at Stamford Bridge as a means of depriving Abramovich of “benefiting from his ownership of the club” .
This means only season ticket holders will be present at home ties, but away support is likely to be absent. Season ticket holders can also make any outstanding payments due for the rest of the season.
Can Chelsea pay their players and staff?
The special license means Chelsea can continue paying their players and staff, with a potential breach of contract meaning lawsuits worth millions of dollars would be a likelihood otherwise.
It is unclear whether Chelsea can fill any staff vacancies, which could be problematic if existing staff choose to leave.
What about the transfer market?
Chelsea are now thought of as operating under a transfer embargo, which means that new permanent acquisitions and loan signings cannot be made.
Similar to their staff predicament, it is unknown whether new deals can be offered to current players, with Barcelona-linked captain Cesar Azpilicueta and center-back partner Andreas Christensen soon free agents, in addition to German international defender Antonio Rudiger.
It has been suggested that just like any potential sale of the club overall, Chelsea might have to seek government approval when attempting to move players on for money.
Can Chelsea receive any sources of income?
The UK government did not mention the impact their sanctions will have on other income at Chelsea in areas such as broadcasting and merchandise.
The Telegraph stated that TV fee payments can be made but will be frozen while the club can also not make money from the sale of merchandise. The club’s official megastore at Stamford Bridge was closed in the hours after the sanctions were announced.
The Athletic reports that Chelsea shirt sponsors Three are “reviewing the situation and are in discussions” with the club, which could affect their agreement currently worth a reported £40 million ($52 million) per year.
How have Chelsea reacted to the sanctions?
Chelsea released a statement confirming they had received news of the sanctions on Abramovich and that they had been issued a general license by the UK government that permits them to “continue certain activities” .
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Chelsea react to Abramovich sanctions
Chelsea revealed that they will fulfill their men’s and women’s team fixtures against Norwich and West Ham on Thursday, but also “engage in discussions with the UK Government regarding the scope of the license” and seek permission for it to be amended so the club can operate “as normal as possible.”
Guidance will also be sought from the British authorities on how Chelsea Foundation community activities will be impacted by the measures.
https://ift.tt/gkP915R 10, 2022 at 09:15PM
