UK gives Abramovich final warning to transfer £2.5bn to Ukraine fund

The UK has given its final warning to Roman Abramovich to release £2.5bn from the oligarch’s sale of Chelsea FC to give to Ukraine, telling the billionaire to release the funds within 90 days or face court action.Keir Starmer told the House of Commons the funds from Abramovich, who is subject to UK sanctions, would be converted into a new foundation for humanitarian causes in Ukraine and that the issuing of a licence for the transfer was the last chance Abramovich would have to comply.The move comes on the eve of a crucial EU summit, where leaders will be urged to agree to use Russia’s frozen assets to provide Ukraine with a €90bn loan.“The clock is ticking on Roman Abramovich to honour the commitment he made when Chelsea FC was sold and transfer the £2.5bn to a humanitarian cause for Ukraine,” Starmer said. “This government is prepared to enforce it through the courts so that every penny reaches those whose lives have been torn apart by Putin’s illegal war.”The Russian billionaire sold Chelsea in 2022 under pressure from the British government after the Russian invasion of Ukraine.Abramovich was granted a licence from the UK government to sell Chelsea as long as the money was spent supporting the victims of the Ukraine war. The proceeds were placed in a UK bank account controlled by Abramovich’s company Fordstam.Since then, the money has been frozen amid deadlock in negotiations with Abramovich on whether it should be spent exclusively in Ukraine, or can go outside the country as well.Abramovich is understood to have been given three months before the government commences legal action, though the Liberal Democrats called for the time to be curtailed, saying the billionaire should be given only until the end of the month to transfer the funds.The billionaire has said he wanted the money to go to “all victims of the war in Ukraine”, and has demanded that Russians also benefit from the proceeds.Abramovich must take the necessary steps to establish the foundation and arrange the transfer in accordance with the licence. “In terms of the foundation, there’s a few steps to go before we get to that point,” the prime minister’s spokesperson sad.“The licence enables the transfer. Mr Abramovich must take the necessary steps to establish the foundation and arrange the transfer in accordance with the licence. In terms of the setting up of that, it’s a few steps away. This is the first step in that process.”Announcing the new licence, the chancellor, Rachel Reeves, said it was “unacceptable that more than £2.5bn owed to the Ukrainian people can be allowed to remain frozen in a UK bank account. It’s time for Roman Abramovich to pay up. If he doesn’t act, then we are prepared to do what is necessary to make sure that money gets to the Ukrainian people.”Ministers emphasised they had tried for many years to agree terms with Abramovich and get his cooperation in the funds transfer. Starmer said the government was prepared to take Abramovich to court in order to access the money.The Guardian reported in March that ministers believed ultimately legal action was likely to be needed. The government has said it would consider “any proposal” from Abramovich to voluntarily donate the funds to Ukraine.Under the terms of the licence, proceeds must go to humanitarian causes in Ukraine but future gains can be spent more broadly on victims of conflict worldwide. The funds cannot benefit Abramovich or other individuals under sanctions.The move comes as the Ukrainian president, Volodymyr Zelenskyy, said proposals negotiated with US officials on a peace deal to end Russia’s war in Ukraine could soon be completed.US officials said on Monday they had resolved “90%” of the problematic issues between Russia and Ukraine after two days of talks in Berlin, though Russian officials have not been present.Talks are continuing this week between European leaders on a separate plan to use frozen Russian assets to finance Ukraine in the coming years, with a leaders’ meeting scheduled to begin on Thursday.Most of the assets, €185bn (£162bn), are held at the Euroclear central securities depository in Brussels. Belgium has said it is not prepared to release any of the funds without guarantees that it will not be held liable for the money.Moscow has said that using the assets would be theft and has threatened to seize European private investors’ holdings in Russia. Plans under discussion mean the EU would provide an initial €90bn loan for Ukraine using the cash at Euroclear, but Russia’s claim on the funds would remain untouched. Ukraine would repay the money only if and when Russia agreed to pay reparations.