Roman Abramovich assertion issued as choice defined after Chelsea takeover

Roman Abramovich’s company, Fordstam Limited, has not filed HMRC accounts since December 2021, while the money from the sale of Chelsea is still being held in a frozen UK bank account

Former Chelsea owner Roman Abramovich‘s firm Fordstam Limited has remained operational due to a technical loophole – despite not submitting HMRC accounts since December 2021.

The cash from Abramovich’s Chelsea FC sale in May 2022 is still locked in a frozen UK bank account. Abramovich vowed the proceeds from the club’s sale would be dedicated to aiding victims of the conflict in Ukraine.

Following Russia’s incursion into Ukraine, he was sanctioned along with other prominent figures for purported connections to Vladimir Putin and the Russian state.

Chelsea were snapped up by a consortium led by Clearlake Capital and Todd Boehly for more than £2.5billion, with promises of pouring at least an additional £1.5 billion into the club’s stadium, foundation, women’s team, and academy.

Despite this, Abramovich hasn’t been able to tap into these funds, and a report from The Times, quoting the Office of Financial Sanctions Implementation, outlines the predicament.

“This is a complex legal issue, but the UK is working with international partners, has engaged with Abramovich’s team, and is exploring all options to ensure the proceeds reach vulnerable people in Ukraine who are most in need,” the statement read.

“We are determined to see the proceeds reach humanitarian causes in Ukraine as soon as possible. We are doing everything we can to bring that about quickly.”

Football London reports how earlier this month, a separate statement from the Foreign Office read: “UK officials continue to hold discussions with Mr Abramovich’s representatives, experts and international partners, and we will double down on our efforts to reach a resolution.”

Richard Caborn, the former sports minister, has now shed light on attempts to navigate this deadlock. Speaking to The Times, he said: “I have written to Keir Starmer to express my concern and ask him to get the Foreign Office to look at this as a matter of urgency, as we are now in a potentially fast-moving situation.”

There is growing concern over the fate of the funds should sanctions be lifted under a peace agreement. Caborn pointed out: “This is more than £2billion from the sale of Chelsea which could do a huge amount of good in Ukraine but it is nearly three years now and not a penny has reached there.”

Dame Caroline Dinenage, chairwoman of the DCMS select committee, also voiced her opinion. She said: “What it needs for everyone’s certainty and peace of mind is for this issue to be brought to a swift conclusion as soon as possible.”

It’s common practice for companies like Fordstam, where Abramovich serves as a director, to be struck off following years of inactivity. However, the intricacy of this situation has granted them some leeway.

In June 2023, Fordstam faced the threat of being dissolved as a notice for its removal from the register was issued. The First Gazette Notice reported at the time: “The Registrar of Companies gives notice that unless cause is shown to the contrary, the company will be struck off the register and dissolve not less than 2 months from the date shown above.

“Upon the company’s dissolution, all property and rights vested in, or held in trust for, the company are deemed to be bona vacantia, and will belong to the Crown.”

Abramovich’s management firm, MHC (Services) Limited, remains operational despite seeking voluntary liquidation nearly three years prior.

The report said: “The company’s assets are currently subject to an order of seizure imposed by the British government, in line with sanctions imposed against organisations that are deemed to have Russian associations.

“Unfortunately the company’s main client was sanctioned on 10 March 2022. The company’s bank reacted by freezing its account.”

To resolve the matter, the joint liquidators approached the Office of Financial Sanctions Implementation (OFSI) for permission to manage and distribute the company’s assets.

However, their efforts hit a wall as the report states: “The joint liquidators have had to apply to the Office of Financial Sanctions Implementation for authorisation to not only realise the company’s assets but to then distribute realisations made in due order of priority.”

Compounding the difficulties, the OFSI has denied the necessary licence, leaving the company in limbo. The report concluded: “Unfortunately, OFSI has recently refused the licence we have sought on the basis that the application does not satisfy them within the relevant grounds.”