A billionaire and close ally of Roman Abramovich has failed in his attempt to overturn UK sanctions, ending a challenge that had been seen as a crucial test of the government’s response to Russia’s invasion of Ukraine.
The high court in London on Friday rejected the effort by Eugene Shvidler to have the sanctions on him declared unlawful.
Shvidler’s lawyers immediately said he would appeal.
The UK government imposed sanctions on Shvidler in March 2022, a month after Vladimir Putin ordered the full-scale invasion of Ukraine. The UK government targeted Russia-linked oligarchs and officials as part of its effort to “keep tightening the screw on the Russian economy”.
Shvidler had challenged the sanctions on the grounds that they caused disproportionate hardship and discriminated against him as a Russian-born person. He disputed claims by the Foreign Office, when it designated him, that he could have benefited from and supported the Russian government through his involvement with Abramovich.
The judge, Neil Garnham, said in his ruling as he dismissed Shvidler’s challenge: “In my view, it cannot properly be said that the secretary of state has failed to strike a fair balance between the rights of Mr Shvidler and his family and the interests of the community.
“Whilst the effects of designation are serious, and the claimant and his family have been subjected to enormous inconvenience and no little financial loss, they do not threaten his life or liberty. The effects of designation are temporary and reversible, not fixed and permanent.”
Describing the impact on him and his family, Shvidler said he had been forced to relocate to the US, where he is not under sanctions. He said he relied on friends for material needs. Two of his children had been forced to continue their education in the US after being told by their British private schools that their places were withdrawn, he said. Restrictions on spending had made it difficult to maintain and insure his UK properties, he claimed, and he had been unable to keep his 113 metre-long private yacht seaworthy. His two private aircraft were grounded and he had made some household staff redundant.
Shvidler’s business interests were closely intertwined with those of Abramovich, the former owner of Chelsea Football Club. After the fall of the Soviet Union, Shvidler worked for Abramovich’s oil company Sibneft until its sale to Russian state-controlled gas company Gazprom. Until March 2022 he also sat on the board of Evraz, a London-listed steel and mining group previously part-owned by Abramovich. He resigned the day the oligarch was sanctioned.
The UK government estimated Shvidler had built up a fortune worth £1.2bn when it imposed the sanctions. The sanctions included an asset freeze, preventing him using his wealth for anything but essentials, and a ban on travel to or from the UK.
Shvidler’s lawyer, Michael O’Kane, a senior partner at Peters & Peters, a London law firm, said: “Mr Shvidler is a British national. He has never been a citizen of Russia, has not visited Russia for more than 15 years and has been critical of the Russian government’s actions in Ukraine. He was sanctioned by the UK for being a friend of Roman Abramovich and a director of a FTSE 100 company. As a UK citizen, UK sanctions have frozen his entire worldwide assets for an indeterminable period. The impact of this on him and his family is extreme and far-reaching.
“He remains at a loss to know what else he can do to be de-listed, given the absence of UK government engagement, policy or guidance. If this judgment stands, it will make it virtually impossible for any person sanctioned by the foreign secretary to bring a successful court challenge.”
Shvidler was born in the Soviet Union, in a town 200 miles from what is now the Kazakhstan border. However, he moved from the Soviet Union to the US in 1989, and then to the UK in 2004. He gained citizenship of the US and UK.
A spokesperson for the UK government’s Foreign, Commonwealth and Development Office said: “Today FCDO has won comprehensively against a court challenge brought by Eugene Shvidler on his sanctions designation. We welcome this judgment and the message it sends about the strength of the UK sanctions regime.”
