Author: Dr. Angelika Hellweger 23 May 2023
The US has allowed a sanctioned Russian oligarch’s alleged superyacht to be sold, a year after it was targeted by authorities. Angelika Hellweger of Rahman Ravelli considers the issues involved in seizing expensive watercraft.
The United States has given the government of Antigua and Barbuda permission to auction off the superyacht allegedly owned by Mr Audrey Guryev, a sanctioned Russian oligarch.
The US Department of Treasury issued the island nation with a licence that allows for potential buyers to bid on the 267-foot luxury yacht, named Alfa Nero, and for a sale to go ahead. Antiguan officials have said approximately 20 bids have already been received for the yacht. But the yacht still has to be formally removed from the US Treasury’s Specially Designated Nationals and Blocked Persons (SDN) list before a formal change of ownership.
In August last year, the US Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Mr Guryev, who is the founder of Russian fertiliser giant PhosAgro, as part of a targeting of Russians who allegedly supported their country’s invasion of Ukraine. OFAC stated that the Alfa Nero belonged to Mr Guryev and said its location tracking device had been switched off to avoid it being seized.
That same month, US agents and Antiguan authorities boarded the Alfa Nero in Antigua’s Falmouth Harbour, searched it and questioned its crew. The yacht has remained there ever since. Antiguan officials are keen to find a buyer for the yacht as it costs tens of thousands of dollars a month to maintain. The yacht’s crew members are taking legal action to obtain more than $2 million in unpaid wages.
The issue of maintaining superyachts that belong to sanctioned oligarchs is a significant issue for those jurisdictions where yachts are frozen and seized. With annual costs usually being around 10% of the yacht’s value - and yachts selling for anything from $1 million to $175 million - their upkeep can be hugely expensive. Physical maintenance and repairs, berthing and mooring costs and insurance all still have to be paid for when a yacht is going nowhere because its owner has been sanctioned.
Mr Guryev’s lawyers have said he is not the yacht’s owner and claimed he had only chartered it occasionally since 2014, when it was reportedly bought for $120 million. Mr Guryev also faces sanctions in the European Union, the UK, Switzerland, Canada, and Australia. He resigned as PhosAgro’s CEO in March 2022.
Angelika is a specialist in international, high-level economic crime investigations and large-scale commercial disputes. She has widely-recognised expertise in representing corporates and conglomerates in Europe, the Middle East, Africa and United States.