UK Chelsea sanctions explained, as Three ‘reviews’ sponsorship deal

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Chelsea shirt sponsor telecommunications firm Three has placed the deal under review after the UK government imposed sanctions on club owner Roman Abramovich on Thursday.

Abramovich was sanctioned, freezing the planned sale of Chelsea by the Russian-Israeli billionaire. The 55-year-old put Chelsea up for sale on March 2 following Russia’s continued invasion of Ukraine.

Abramovich owned chelsea since 2003 and has always strongly denied any current political links with Russia’s ruling elite, but Boris Johnson’s government has now frozen all of his UK assets.

And it’s already had a ripple effect with Three reflecting on their three-year sponsorship deal.

A company spokesperson said: “We are in discussion with Chelsea and reviewing our position.”

The deal was announced in January 2020, with the company’s logos appearing on the shirts since the start of last season.

“Three is proud to be the principal sponsor and key partner of Chelsea Football Club,” read a statement at the time.

The sale of Chelsea could take place

Meanwhile, the UK government remains ‘open’ to selling Chelsea despite imposing asset freeze sanctions on Abramovich.

The Treasury is expected to approve a new license for the sale of Chelsea. But Russian-Israeli billionaire Abramovich would not be allowed to profit from it.

Many parties have shown interest in buying Chelsea. And Downing Street has now confirmed the government can still oversee a sale.

Prime Minister Boris Johnson’s spokesman said: “We are talking to Chelsea Football Club now and those conversations will continue. It would be part of those discussions of the terms of any specific license granted to allow any sales to proceed.

“The important thing is that in no case would a sale allow Roman Abramovich to profit from it or to withdraw money from this sale.

“It’s fair to say that the government is open to selling the club. But currently that would require another license and that would require further discussions with the Treasury and other departments.

Here, the PA news agency examines the details of what the club can and cannot do.

Sale of the club

The current license does not allow Abramovich to sell the club, which was his stated intention. However, a spokesman for Prime Minister Boris Johnson said on Thursday that a specific license could be granted to allow a sale to be completed.

“The important thing is that under no circumstances would a sale allow Roman Abramovich to profit from it or make money from this sale,” the spokesperson said.

Payments

A document issued by the Treasury indicates that the club can continue to pay the salaries, allowances and pensions of all employees. Fees, dividends and other compensation to pre-licensing directors may be paid. The exception being anything due to Abramovich.

Costs related to the daily maintenance of club facilities may be paid. But no money can be spent on new capital works or refurbishment of Stamford Bridge or any other club-owned venue.

Payments in

The club can still receive money from other clubs for loan deals or the sale of existing players.

Television income and entertainment costs can still be paid to the club.

Transfers and contracts

No sale or purchase of new player will be permitted under the license. And talks of new deals for out-of-contract players this summer must be put on hold.

game day

Travel costs for any match played by a team representing Chelsea will be capped at £20,000. This immediately raises the question of how the men’s side will be able to fulfill future Champions League away fixtures beyond next week’s Round of 16 second leg against Lille.

Fees of up to £500,000 for hosting any Chelsea game may be paid for security, stewardship etc.

Existing ticket holders can still attend matches and purchase food and beverages during their stay. However, new tickets cannot be purchased by Chelsea or away fans wishing to visit Stamford Bridge. This includes in regular areas of the pitch or in corporate hospitality sections.

Merchandise

Third parties who purchased or produced club merchandise prior to March 10 are permitted to sell existing inventory, provided no funds or other financial benefit is made available to the club or Abramovich.

Other points and principles

The club is required to keep records of any activity permitted under the license worth more than £5,000 for at least six years.

The license expires on May 31. The Treasury reserves the right to modify, revoke or suspend it at any time. The basic principle of the license is to deny access to income, beyond what the club needs to operate on a day-to-day basis.

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