The Todd Boehly-led Clearlake consortium bought Chelsea in May 2022 as Abramovich was sanctioned over alleged links to Russian president Vladimir Putin, but funds have been in limbo since.
In correspondence seen by Telegraph Sport, Abramovich’s lawyers insist he remains “fully committed” to using the money for charitable purposes. But their letter sent on Monday attacks “politically charged and highly publicised statements made by the UK Government” against their client. “Unfortunately, this approach is consistent with the manner in which the UK Government has handled this matter since the sale of Chelsea FC in 2022 – across the tenure of four prime ministers and five foreign secretaries,” the letter sent on Monday reads.
Abramovich’s UK-registered vehicle Fordstam received the £2.35bn in the spring of 2022. “It is important to emphasise that the funds – although currently frozen – remain the property of Fordstam Limited, which is wholly owned by Mr Abramovich,” says the letter from Abramovich and Fordstam’s lawyers.
They say Abramovich still plans to honour a pledge he made prior to selling Chelsea that he would donate proceeds to “all” victims of the Ukraine war. “The proposal to donate these proceeds was initiated by Mr Abramovich prior to the imposition of sanctions, and he remains fully committed to ensuring that the funds are used for charitable purposes,” the letter says. “As such, any donation will be made voluntarily by our clients.”
Why is the money from the sale of Chelsea still unresolved?
When Abramovich first put the club up for sale in March 2022, he said the “net proceeds” would go to “all victims” of the war. The Government claims privately that the delay is down to Abramovich’s refusal to agree to terms to spend the cash only within the borders of Ukraine. In the Abramovich camp’s view, such debate has been moot since the Royal Court of Jersey imposed a formal freezing order on $7bn (£5.3bn) worth of his assets in April 2022, a month after his pledge.
The attorney general of Jersey said at the time that Abramovich was a suspect in a criminal investigation, which has prompted a lengthy and as yet unresolved legal battle, launched by the Russian to clear his name. The situation has complicated efforts to release the Chelsea fund as Fordstam has an outstanding £1.5bn debt to Camberley International Investments, the Jersey parent company that was hit with an assets freeze. Sources close to discussions maintain that debt will not affect the total amount due to Ukraine war victims. However, Abramovich’s lawyers have repeatedly refused to discuss the fund’s release while the Jersey row remains unresolved.
Why is Abramovich’s demand that the money go to ‘all victims’ of the war in Ukraine important?
The latest letter from Abramovich’s lawyers to the Government details how his terms for the charitable fund were signed in a “formal Deed of Undertaking… expressly approved by the UK Government” in 2022.
Since the Chelsea sale was completed, the Government has insisted the money can only be spent within Ukraine to avoid any risk that funds could end up in Russia. But Abramovich’s position, supported by humanitarian charities such as Save the Children, was that the war has caused humanitarian emergencies beyond Ukraine’s borders.
What has the Government done to break the deadlock?
With the Government facing criticism over delays in releasing the fund, the Prime Minister in December issued what he said was a formal licence for it to be handed over. “Honour the commitment you made and pay up now, and if you don’t, we are prepared to go to court so every penny reaches those whose lives have been torn apart by Putin’s illegal war,” Starmer told the House of Commons. It was the second time in six months the Government had threatened court action.
Previous government figures involved in talks have told Telegraph Sport that attempting to seize the fund would be a “nuclear option”. “We didn’t go there during our time in government as it sends a worrying message to the markets,” said a source previously involved in talks at the Foreign Office.
How significant is Abramovich’s intervention today?
This is the first time any contact from Abramovich’s side to UK Government has been made public. It pulls no punches about perceived failures by ministers. “It [the Government] has now chosen to threaten litigation and to issue a licence unilaterally, without having a legal basis for doing so,” the letter adds. It is clear Abramovich is confident in his position as he puts the ball back in the Government’s court. With court action now looming, an end to this saga is nowhere within sight.