Dutch shipbuilder sues government over Russia sanctions

Dutch shipbuilder Damen Shipyards is suing the Dutch government for losses incurred due to ongoing European sanctions against Russia.

Damen, which is the Netherlands’ largest shipbuilder, manufactures a wide range of commercial and military vessels and luxury yachts. The Gorinchem-based firm is seeking compensation for the loss of business incurred by the sanctions put in place after the invasion of Ukraine.

Speaking to Bloomberg, the company’s spokesperson, Rick van de Weg says: “Before the sanctions, Damen had signed contracts with Russian ship buyers, and after the invasion of Ukraine, the Dutch government decided that such contracts may not be honoured by the Dutch business community.

“The government has not offered Damen compensation for that damage.”

The lawsuit was filed in the Court of Rotterdam on 10 May 2023, according to Bloomberg, and has only just been made public.

It’s expected that the case will proceed next year.

As a member of the European Union, the Netherlands must comply with all sanctions imposed by the bloc. The Dutch Ministry of Foreign Affairs has so far declined to comment to media.

This is the latest legal twist in a series of battles playing out in courtrooms related to sanctions against Russia. The yacht industry has become a particular focal point for many of these cases since 2022, as the US and Europe looked to punish wealthy Russians with ties to Putin by pursuing their luxury assets.

Last month, ex-Google CEO Eric Schmidt formally withdrew a $67m bid for the ‘abandoned’ 82m Oceanco superyacht Alfa Nero, which was ditched in Antigua, due to ongoing legal complications.

The Antigua government says the true owner has never been officially located and is evidently keen to wash its hands of the vessel, which is said to be costing the authorities a hefty US$112,000 a month in maintenance fees and crew wages.

And in October last year, a row erupted in South Africa after the government said it would not seize a sanctioned Russian oligarch’s superyacht attempting to dock in Cape Town, despite the city’s mayor calling for the country to bar it from entering.

Dutch government data shows that the Netherlands is keeping 23 luxury vessels under surveillance in relation to sanctions against Russia and Belarus, as well as several aircraft.

Last April, the Dutch government said it was preventing 14 yachts, including 12 that were under construction, from leaving the country due to sanctions on Russia.

Shipbuilding is a significant industry in the Netherlands. Major builders Heesen, Feadship, Damen Shipyards and Oceanco had combined sales of around €1.5bn euros in 2020, according to chamber of commerce records.