Explained: How Chelsea are affected by Abramovich sanctions
The Blues owner has had his assets frozen after being accused by the UK Government of aiding Russia’s Ukraine offensive
Roman Abramovich has been sanctioned by the United Kingdom Government, which will freeze his overseas assets, including Chelsea Football Club.
On March 10, it was announced that Chelsea owner Abramovich, alongside six other high net-worth Russians, would be issued with an asset freeze and travel ban.
Chelsea are now in an unprecedented period of uncertainty as the running of the club becomes directly linked to geopolitics.
Will Chelsea still be sold?
Chelsea can still be sold provided the sale does not benefit Abramovich or the Russian Federation, and the club are in discussions with the government about next steps.
A statement from the UK government reads: “While the current licence does not permit the sale of the club at this time, the Government is open to a sale of the club and would consider an application for a new licence to allow for a sale.
“Proceeds from any sale could not go to the sanctioned individual while he is subject to sanctions.”
At least 20 buyers had been previously ready to purchase Chelsea.
What about Chelsea’s games & tickets?
Chelsea can continue to play matches under a special ‘Russia Regulations’ licence which also allows their 1,400 staff – including players – to be paid.
The upcoming Thursday evening kick-off against Norwich in the Premier League will go ahead, but only season ticket holders will be allowed to attend home games with further ticket sales barred.
Will Chelsea still be able to buy & sell players?
The Blues are not allowed to sign any new players due to the terms of their licence.
It effectively places another transfer ban on the European and world champions, with the club having already endured one just three years ago.
Although Chelsea are banned from making transfers, they can move money in and out of other clubs for outstanding payments related to deals done before the sanctions were imposed on March 10.
Will Chelsea’s contract renewals be affected?
Chelsea cannot continue their efforts to renew the contracts of their players, with expiring deals like Antonio Rudiger, Cesar Azpilicueta and Andreas Christensen having been previously high on their agenda.
Their deals run out in the summer, as do the contracts of several talented youth players, including Xavier Simons.
It could force the club to hold onto all players currently under contract, due to their inability to bring players in, should the issue not be resolved in the near future.
What about Chelsea’s sponsorship deals?
Chelsea’s main shirt sponsor, 3, is known to be reviewing its deal with Chelsea.
“Sanctions placed on Chelsea owner Roman Abramovich by the UK Government casts a shadow over Chelsea’s many commercial agreements, including its $52.5 million (£40m) front-of-shirt deal with Telecom’s brand 3, and its $72m (£55m) kit deal with Nike,” says Conrad Wiacek, Head of Sport Analysis at GloblalData, a leading data and analytics company.
“While Chelsea has a sporting licence to continue trading as a soccer club, many brands will be wary of guilt by association.
“Chelsea FC is still one of the biggest clubs in the world and its on-field success still makes it an attractive commercial partner. However, given the rate at which many brands are looking to dissociate themselves from the Russian state, some may be wary of continuing partnerships.
“Nike’s deal with Chelsea runs until 2032, so the apparel brand may decide to wait the situation out until the club’s sale is able to continue. However, brands such as Hyundai and Hublot, which have deals worth over $20m (£15m) combined expiring at the end of 2021-22 season, may not have that luxury.”
Are there any other details at this stage?
Chelsea will be allowed to spend some money on staging matches at Stamford Bridge and in travelling to away matches.
A spending limit of just £20,000, however, applies to travel to away games, and could cause issues with preparations for Champions League fixtures in particular.
The club will also have to prove that such costs are ‘reasonable costs’.
Chelsea are also barred from receiving any revenue from merchandising sales, but will be allowed to take revenue from broadcasting matches.
What is Roman Abramovich’s net worth?
Abramovich is said to be worth £9 billion ($12bn) and valued Chelsea at £3bn ($4bn) during his negotiations to sell the club.
When will the sanctions be lifted?
It is currently unclear if or when the sanctions will be lifted. It relates directly to Russian President Vladimir Putin’s activity and the invasion of Ukraine.
Sanctions will be reviewed in May, but there are further risks of a nine-point deduction should Chelsea go into administration.
In the statement released by the UK Government, it describes Abramovich as a “pro-Kremlin oligarch who has been involved in destabilising Ukraine.”
He is further described as having a “close relationship with Putin” and providing steel for tanks in Russia’s offensive.
Prime Minister Boris Johnson stated in his government’s release: “There can be no safe havens for those who have supported Putin’s vicious assault on Ukraine.
“Today’s sanctions are the latest step in the UK’s unwavering support for the Ukrainian people. We will be ruthless in pursuing those who enable the killing of civilians, destruction of hospitals, and illegal occupation of sovereign allies.”