UK Supreme Court upholds sanctions on Russian-born oligarch Eugene Shvidler
The UK Supreme Court upheld government sanctions on Russian-born oligarch Eugene Shvidler on Tuesday, rejecting his human rights challenge to asset freezes imposed over his connections to sanctioned billionaire Roman Abramovich and involvement with Russian steel giant Evraz.
The court ruled 4-1 that the sanctions on Shvidler were proportionate responses to Russian aggression despite severe impacts on him and his family. The measures freeze his assets worldwide and make it a criminal offence for others to deal with him commercially.
Shvidler, who is now a British citizen, was sanctioned in March 2022 over his connections to Abramovich, the former owner of Chelsea football club who now lives in the US, and his former role as non-executive director of steel giant Evraz, which is headquartered in Moscow.
Syed Rahman, partner at law firm Rahman Ravelli in London, said the ruling ‘sends a chilling message to foreign nationals, however loosely they may be connected to Russia’.
The majority judgment found that the UK Foreign Secretary had ‘special constitutional responsibilities’ to respond to Russia’s invasion and should be accorded ‘a wide margin of appreciation’ in containing Russian actions.
The court also unanimously dismissed a separate case brought by Dalston Projects Ltd over the detention of the Russian-owned luxury yacht Phi in London docks since March 2022. The yacht is beneficially owned by Russian businessman Sergei Naumenko, who challenged the detention as interfering with his property rights.
The court accepted government evidence that Shvidler’s designation would ‘send a signal to both him and others associated with persons involved in the Russian elite that there are negative consequences to having implicitly legitimised the Russian government’s actions’ in Ukraine.
‘It has to be asked whether the Supreme Court’s decision amounts to giving carte blanche to political sanctions rather than to principled human rights jurisprudence,’ said Rahman. ‘The judgment raises serious questions about whether we are witnessing the rise of political sanctions that are being dressed up in the language of human rights law.’
The ruling acknowledged that sanctions had ‘severe, open-ended and drastic’ effects on Shvidler and his family but found that ‘their core needs can be met through the OFSI licensing system, even if their luxury lifestyle and private-school education may have been disrupted’. It explained that ‘sanctions often have to be severe and open-ended if they are to be effective’.
Rahman commented that there is a broader principle at stake.
‘If the principle of proportionality becomes rhetorical – and precision gives way to symbolism – then the UK risks abandoning any sense of legal nuance in favor of the very broad brush of geopolitics,’ he said. ‘While the Supreme Court claimed to allow for a full proportionality test, it nonetheless deferred heavily to ministerial judgment, particularly in matters touching on foreign policy and national security. This creates a one-way mechanism by which ministerial actions are upheld in practice, even when challenged in principle. By accepting that each designation need only possibly contribute to sanctions-related objectives – and, therefore, put pressure on Russia – the court has lowered the bar for individual sanctions.’
