The O Monaco Yacht Show

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Having the US government trying to seize one of your aircraft is unfortunate. Having them trying to seize two looks like carelessness.

Last week a New York court issued a warrant for a Gulfstream G650ER and a Boeing 787 both owned by Russian oligarch Roman Abramovich.

After the invasion of Ukraine, the US Department of Commerce’s Bureau of Industry and Security (BIS) imposed export controls on US-manufactured aircraft, aircraft parts and components to Russia.

BIS says that by flying the aircraft into Russia, Abramovich broke these sanctions. The 787 was flown to Russia in early March and is now in the United Arab Emirates. The Gulfstream flew to Russia twice in March and is there now.

BIS had identified the G650ER for breaking export regulations in March. At the time it warned that anyone who supported the aircraft without authorisation could be fined or jailed. Although he has been sanctioned by the EU and UK, Abramovich has not been sanctioned by the US.

It may take time for the US to seize the aircraft. No Russian court will help. The United Arab Emirates has not issued any sanctions against Russia and abstained on United Nations votes against the invasion of Ukraine.

 “My guess is that the UAE will take any request seriously but not act quickly. The US would basically have to argue its case in a Dubai court and that could be a very long process,” says one lawyer in the region. “The aircraft is basically parked in Dubai now.”

The lawyer points out that manufacturers are taking sanctions seriously and will not provide any support to either aircraft.

Andrew Adams, director of Task Force KleptoCapture said: “While we seek to execute on these warrants, the task force eagerly anticipates working with international partners to uphold the rule of law and reminds members of the aviation, insurance, and financial industries that these aircraft constitute tainted property under active investigation by the US.”

US attorney Damian Williams also warned owners of other aircraft that have flown into Russia since sanctions came into place. He said: “Our international partners — nations devoted to the rule of law — far outnumber those jurisdictions where these aircraft can safely hide, and our investigation of illegal exports in violation of US law will continue unabated.”

The US is prepared to target assets anywhere in the world. This week it successfully seized a 348ft (106.1m) superyacht in Fiji. The corporate owner of the motor yacht Amadea argued against this seizure but lost hearings in Fiji’s three highest courts.

The Amadea case is significant as US authorities say that the real owner – who was sanctioned in 2018 – hid behind another individual who acted as a straw man. The yacht was sold in 2021 which means that the task force is also targeting historic cases.

The US was already investigating several European business jet companies last year for possible similar sanctions violations. Two weeks ago the US sanctioned a large Monaco yacht brokerage – Imperial Yachts – and its founder. Imperial says that it has been unfairly targeted.

“This yacht seizure should tell every corrupt Russian oligarch that they cannot hide – not even in the remotest part of the world. We will use every means of enforcing the sanctions imposed in response to Russia’s unprovoked and unjustified war in Ukraine,” said Lisa O. Monaco, the deputy attorney general when the yacht was first seized.

The US could sell all the seized yachts in one go. The Lisa O. Monaco Yacht has a nice ring to it.

 

Anywhere and anytime: The US is prepared to target business aviation and superyacht assets suspected of sanctions busting anywhere in the world, after president Putin’s invasion of Ukraine.

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