A business associate of Roman Abramovich, the former owner of Chelsea Football Club, has failed to overturn sanctions imposed on him after Russia's invasion of Ukraine. The Supreme Court judgment, issued on Tuesday, is seen as a test case for the UK's sanctions regime.
Eugene Shvidler, a Russian-born British citizen now living in the US, was placed under sanctions in March 2022. He had challenged his designation at the High Court in 2023 and appealed that decision last year, arguing the measures caused disproportionate hardship and discriminated against him as a Russian-born person. He also claimed he was not sufficiently closely associated with Abramovich to justify the Foreign Office's move.
In a 4-1 majority decision, the Supreme Court dismissed the appeal, stating that sanctions must be severe and open-ended to be effective. The judgment said: 'Sanctions often have to be severe and open-ended if they are to be effective. The object of the designation in relation to Mr Shvidler is that he should so far as possible be disabled from enjoying his assets and pursuing his wealthy lifestyle.' The judges added that there was a rational connection between Shvidler's designation and the aim of the sanctions, and that the effectiveness of the regime depends on cumulative measures.
However, in a dissenting judgment, Lord Leggatt described the sanctions as 'Orwellian' and argued the government had not shown a rational connection between the freezing of Shvidler's assets and the objectives. 'I do not consider that the reasons relied on by the government come close to justifying such a drastic curtailment of his liberty,' he wrote.
Shvidler said: 'This Supreme Court judgment brings me back to the USSR, which I left as a stateless refugee 36 years ago, seeking sanctuary in the US. Back then, individuals could be stripped of their rights with little or no protections and that is how I feel about this judgment.' The UK government had imposed sanctions on grounds including his association with Abramovich, who benefited from or supported the Russian government. Shvidler was a long-serving director of Evraz, a steel and mining company where Abramovich was a leading shareholder, and chaired Millhouse LLC, which managed assets for Abramovich and Shvidler.
In a related case, the judges unanimously dismissed an appeal by Dalston Projects Ltd, a St Kitts and Nevis company that owns a luxury yacht detained at a London dock. The ultimate owner is Russian citizen Sergei Naumenko, who said he had been prevented from earning income from chartering the vessel.
