Roman Abramovich Company Closed Without Paying €14M Tax Bill in Cyprus

A company owned by sanctioned Russian oligarch Roman Abramovich shut down before paying any of its 14-million-euro tax bill in Cyprus, the country’s tax commissioner said on Thursday, adding that it would be impossible to recover the funds.

Questions were raised in Cyprus’ Parliament about the company’s tax bill following an investigation published in January by OCCRP, The Bureau of Investigative Journalism, BBC, and OCCRP's Cypriot member center, CIReN.

The investigation revealed that Abramovich’s company, Blue Ocean, set up a fake superyacht-leasing business in an apparent attempt to evade millions of euros in tax. 

The scheme began in 2005 and lasted till 2012 when Cypriot tax officials found that the yachts were not in fact used commercially. They ordered Blue Ocean to pay 14 million euros (about $18.5 million) to cover the unpaid Value Added Tax (VAT).

Lawyers for the company tried to overturn the order in courts for 12 years, but their appeal was dismissed in March 2024. Blue Ocean was dissolved the following July. 

However, Cypriot Tax Commissioner Sotiris Markides told a Parliamentary committee on Tuesday that “no settlement was made before it was dissolved.”

Speaking to CIReN after the Parliamentary session, Markides said “the unpaid VAT related to the period 2005 to 2010 and could not be pursued by the Cypriot authorities after so many years, because Blue Ocean no longer had any directors.”

“Am I supposed to go 20 years back to track down directors from 2005, 2006, 2007 and ask them what happened?” he said. “From whom can I collect money when the company no longer exists?”

Legally, Blue Ocean should not have been closed unless the unpaid tax had been settled, which prompted Alexandra Attalidou, an MP with the opposition Volt party, to raise the issue in Parliament.

In Thursday’s session, Attalidou asked whether the country’s attorney general, George Savvides, had issued a legal opinion “before Blue Ocean was dissolved” since the case had been referred to his office.

The Parliamentary Standing Committee on Development Plans and Public Expenditure Control has scheduled another session in two weeks to discuss the matter further. 

Speaking to a representative from the Attorney General’s Office, Committee Chair Zacharias Koulias, an MP from the ruling DIKO party, requested that Savvides himself attend the next session. 

“The position of the attorney general is very important, and the issue is critical, because it appears the tax commissioner referred the case to your office for legal opinion,” Koulias said.