By Tony Attwood
Does it matter where your club owner lives?
You may recall (if you are an avid reader of my meanderings) that I have dealt with the residency of Arsenal’s minority owner Alisher Usmanov and his move to Switzerland as part of his work with the International Fencing Federation.
Mr Usmanov’s company USM Holdings (which controls Metalloinvest) is registered in Cyprus. Metalloinvest is Russia’s largest iron ore producer, and also has interests in telecoms, the Internet and the media, mobile phone operations and the IT company Mail.ru
But things can move and things can change, as when in 2014, USM Holdings transferred parts of its business to Russian holding companies as part of what has become called the Russia de-offshorization policy.
I thought of such things when last weekend the Sunday Times reported that Roman Abramovich, the owner of Chelsea, had obtained a court order banning the Swiss media from reporting the reasons he withdrew his application for residency in the country.
It had been reported he wanted to live in the exclusive ski resort of Verbier but changed his mind after his application was provisionally rejected by the authorities.
Two Swiss papers Le Matin Dimanche and SonntagsZeitung, were then barred from publishing further details. “Our editorial team will continue fighting to get the ban lifted. The background is likely to be of great public interest,” SonntagsZeitung said. The Times and of course the Swiss press carried the story.
Meanwhile last month the Sun ran the headline “Chelsea FC owner Roman Abramovich given permission to live in Jersey as a ‘high-value resident’.”
The Sun reported that, “The decision to grant Mr Abramovich’s residency application is seen by some in government as a feather in the Island’s cap and evidence of the strength of its finance and professional services industries, it’s history of stable government, its courts and its globally respected regulatory regime.
“It is understood that the bar for approving the businessman’s application was set necessarily high to establish the sources of his wealth and because he would be deemed a politically-exposed person.”
These days people who want to live in Jersey have to show that their income is sufficient to pay the States (the island government) at least £145,000 per year. It is also reported that Mr Abramovich’s representatives went to the island to tie up the deal.
Jersey of course is not part of the United Kingdom (and as the UK will soon also not be) is not part of the EU and so not bound by their pesky restrictions on money, but the UK sees Mr Abramovich as an investor in Britain. And that has helped give him a residency permit in Britain.
Reports in various places suggest he has had what is known as “non-dom” status in the UK for around 15 years. These are people who have their “permanent” home outside and so do not necessarily have to pay tax in the UK on income they earn from outside the UK. As I understand it Mr Abramovich earns most of his money from outside the UK.
So why did he get a court order banning the Swiss media from reporting the reasons as to why he withdrew his application for residency in Switzerland?
Of course I suggest nothing at all underhand is going on. Mr Abramovich had received a preliminary decision in his favour concerning his residency request from authorities in Valais. It is reported that this was confirmed to the Swiss News Agency, ATS, by Jacques de Lavallaz, head of the cantonal immigration service.
Le Matin Dimanche and SonntagsZeitung both claim that they know exactly why Mr Abramovich withdrew his application but they are now not allowed to report it.
They state that when the file on Mr Abramovich was sent to Bern it was provisionally rejected by the Swiss federal authorities.
Although the issue of residency for overseas nationals of considerable wealth is just a matter of normal daily procedure on the island of Jersey, Le Matin Dimanche has made the point that this is not so in Switzerland and this particular case highlights the issue of what it calls “exceptional residence permits for rich foreigners” which Switzerland can grant in rare cases considered “of major public interest”. The “major public interest” clause is normally used to suggest they can make useful potential tax contributions.
Reports suggest that over the last ten years 578 people have got such permits. According to the newspaper, “One of them is Russian oligarch Mikhail Khodorkovsky, whose presence in Canton St. Gallen has been controversial. Socialist members of the cantonal parliament considered that the tax revenues were not a sufficient reason to grant residence compared with the possible risk to reputation represented by a Russian oligarch.”
It also adds that Mr “Abramovich is 139th on the Forbes list of the world’s richest people, with assets worth some $9 billion, according to Le Matin Dimanche.”
It is strange to think as we trot along to the games and pay for our season tickets, these people have wealth so vast that they feel the need to shuffle it and themselves around the globe.
4 Replies to “The strange case of the residency of Roman Abramovich”
Rich people seem to often seek residencies like this. I read recently that the founder of Ikea had his residency in Switzerland to avoid paying tax in his native Sweden. They are always described as ‘reclusive’ as well which is presumably to deter investigation into their finances and spending habits. Roman Abramovich is presumably no different in that regard. No doubt Mr Kronke has various ways of doing the same.
But in this matter of the court order banning the Swiss media from reporting the reason behind Mr Roman Abramovich withdrawal of his residency application permit, But is the freedom to obtain information and dissemination Act as it covers the Switzerland newspaper not being violated by this court order?
considering how his wealth is important, it stikes me that he did not get approval.
Then, as we’ve seen lately, he is on an A-List published by the White House, meaning he’d probably be on a list of people part of sanctions the US may enact at a later time…. I’m trying to understand the why of this list, so this is conjecture on my part. Basically he would be deemed too close to Mr Putin which explains his presence on the list
Furthermore Switzerland has enacted new regulations about the money that comes into its banks. And the ‘dropy our money bags, we’ll count it and keep for you and see you next time’ caricature does not really apply. At least. this is the image that is given – one never knows when so much money is being considered. And as of today, the way it is explained is that any dictator, or his kids, family or close friends and associates are having a quite harder time to show a fortune that comes from acceptable (under swiss law) sources.
So it may well be that he has run afoul of these new criteria.
Mr Kroenke, if he was like other US billionaires, probably financed the Trump campaign and got his taxes lowered with the new tax law…. so why hide his fortune when it is taxes lower then the icome of a housecleaner….just invest in someone who makes it happen legally…..
He has also recently change his country of residency on the 23 March 2018 for Fordstam Limited Company Accounts, Chelsea’s holding company, from Switzerland to Russia.