Difficult problem with EU when confiscating superyacht of Russian tycoon

French customs officers seized the white, 86-meter-long and towering yacht as the crew prepared to leave port on the night of March 2, two days after the European Union named Igor Sechin named Igor Sechin. , the head of the Russian state-owned oil company Rosneft, is on the sanctions list for Moscow’s war in Ukraine.

French authorities have seized the superyacht Amore Vero since March 2. Photo: Reuters

Amore Vero belongs to a company controlled by Mr. Sechin, one of the longest-standing allies of Russian President Vladimir Putin, the French Finance Ministry said. However, in a statement to Reuters, Mr. Sechin denied this information.

According to Finance Minister Bruno Le Maire, France has officially seized the Amore Vero, a measure that assigns the yacht to the state at the expense of the owner. However, authorities failed to notify third parties of the yacht’s condition, leaving it unclear who was responsible for its maintenance. As the bills pile up, the company isn’t sure how to collect the money, an executive at La Ciotat said.

“We are continuing to issue invoices,” said Alice Boisseau, communications officer at La Ciotat shipyard. When asked who will pay the bill, she replied: “We don’t know.” Boisseau declined to answer other questions. While French customs also declined to comment on why they did not notify shipyards of the yacht’s condition.

The unanswered questions about Amore Vero reveal the complexities governments face as they aim to punish assets belonging to alleged allies of the Kremlin leadership and the disruption that comes with it. for some businesses.

In the EU, the financial assets of Russian oligarchs have remained largely unaffected, but European nations have frozen or seized physical assets, including real estate and at least 11 superyachts. .

John Dalby, owner of Marine Risk Management, a marine asset recovery business on behalf of insurance companies and banks, says Mediterranean governments have little experience with The legal intricacies of superyacht seizure.

“There is a lack of cohesion in what people are doing: between state actors and other third parties, such as creditors,” commented Mr. Dalby, who revealed he had discussed the matter with him. authorities in the Mediterranean and the United States. According to him, creditors of foreclosed yachts, such as fuel suppliers or crew management companies, can ask the court to sell the yacht to recover their debts.

Ownership

According to the website Superyacht Times, people Russia owns nearly 1/10 of the superyachts in the world. Some yachts, belonging to individuals sanctioned by the EU and the US, are anchored in safe havens, such as the Eclipse and Solaris superyachts of billionaire Roman Abramovich in Turkey, or are moving in international waters outside the jurisdiction of the sanctioning states.

Superyacht Amore Vero is moored at La Ciotat shipyard in the French Riviera, France. Photo: Reuters

Le Maire newspaper reported that Amore Vero had docked in France to be refurbished by a company specializing in luxury yachts MB92, just in time for the West to punish Russian oligarchs. The French finance minister said authorities had arrested rather than simply “freezed” the yacht because Amore Vero’s attempt to leave port violated EU sanctions and French law.

When asked if they have or are expected to receive full payment for the refurbishment of the yacht, MB92 shared, the company is still waiting for an official notification from French Customs about the status of Amore Vero.

According to maritime lawyer Pascal Flot, difficulties in determining ownership of the superyacht could be the reason why French authorities have not informed third parties of its status. The super rich often control their wealth through a network of front companies in offshore tax havens, Flot explained. Amore Vero is operating under the flag of the Cayman Islands.

Unpleasant surprise

Mr. Flot said that the annual operating costs of the world’s largest superyachts can be up to 10% of their value, including crew salaries, repairs, fuel, food, etc. insurance, wharf fees and onshore utilities.

For a yacht like the $540 million Sailing Yacht A, which is owned by Russian coal and fertilizer magnate Andrei Melnichenko and has been seized by Italy in the port of Trieste, that could mean millions in costs. every month.

In Italy, frozen assets are managed by a publicly appointed administrator and maintenance costs are covered by the state asset management agency. The owner would then have to refund the authorities or the state could sell the property to cover the costs.

Italy’s public asset management agency (Agenzia del Demanio) declined to comment on the matter. While, representatives of billionaire Melnichenko remained silent before requests for comment on Sailing Yacht A.

In France and Spain, the cost of operating a “frozen” or confiscated yacht remains the responsibility of the owner. However, blocking their bank accounts means owners are often unable to make payments.

Giannis Markogiannis, a Greek lawyer specializing in international yachting law, insurance and taxation, says another risk to governments lies in the wrongful seizure of superyachts.

A seized yacht whose owner cannot be tied to any of the names on the sanctions list, he said, must be released, leaving the state liable for any deterioration or damage in the process. the process of “freezing” it. Owners can also sue the host country government for lost rental income or being banned from using it.

“All of these issues need to be handled carefully by the country that seized the yacht to avoid unpleasant surprises,” attorney Markogiannis stressed.

Tuan Anh