Hong Kong says ‘no legal basis’ to seize sanctioned Russian superyacht

Hong Kong’s chief executive John Lee says there is “no legal basis” to seize the megayacht of a Russian oligarch who is under Western sanctions.

The 142m Lürssen yacht Nord, understood to belong to steel magnate Alexei Mordashov, arrived in Hong Kong unexpectedly on 5 October, after departing from Vladivostok on 28 September.

Mordashov has an estimated fortune of US$18.9bn, according to the Bloomberg Billionaires Index. Nord is one of the largest yachts in the world, with an estimated value of US$300m.

The Russian consulate in Hong Kong was given advance notice of the arrival of the superyacht, according to the SCMP.

The US State Department has criticised Hong Kong for allowing the yacht to dock in its waters.

“Hong Kong’s reputation as a financial centre depends on adherence to international laws and standards,” a US State Department spokesman said. “The possible use of Hong Kong as a safe haven by individuals evading sanctions from multiple jurisdictions further calls into question the transparency of the business environment.”

Answering questions at a media session in Hong Kong on Tuesday (10 October 2022), Lee confirmed that the financial centre would abide by United Nations sanctions only, and would not act on unilateral sanctions imposed on Mordashov by individual jurisdictions. “We cannot do anything that has no legal basis,” Lee told reporters.

Many Russian superyachts have been arrested or denied entry to jurisdictions around the world since the invasion of Ukraine in February. China, however, has so far not condemned Moscow’s decision to invade Ukraine and remains a Russian ally.

Lee himself has also been sanctioned by the United States for his role in national security legislation that is curtailing freedoms in Hong Kong.

Lee criticised sanctions imposed by the United States on Hong Kong officials.

“It is a very barbaric act and I’m not going to comment. Officials in Hong Kong do what is right to protect the interests of the country and the interests of Hong Kong,” he said. “We’ll just laugh off the so-called sanctions.”

It’s unclear how long the superyacht will remain in Hong Kong’s waters. Visiting yachts can stay in Hong Kong for a maximum of 182 consecutive days, with permission to remain generally granted on a monthly basis.