Burgess granted licence to pay sanctioned crew
After a protracted process, the crew of Luminosity and Alfa Nero will finally receive their pre-sanction salaries before the end of the year…
Burgess has been granted a license by the UK government to pay the crew of Luminosity and Alfa Nero the salaries that were withheld due to sanctions. Having secured the licence from the Office of Financial Sanctions Implementation (OFSI), crew who were employed on board the yachts at the time sanctions were imposed will likely get their salaries before the year’s end.
“The crew have been incredibly patient. They are relieved this matter is now coming to an end,” Lucy Medd, Partner, Head of Crew Management, Burgess tells SuperyachtNews.
The license allows Burgess Crew Services (BCS) PCC Ltd 347 Alfa Nero and 437 Luminosity to pay all outstanding agreed salaries and notice as set out in the termination of employment letters issued to each crewmember in March 2022 at the time the sanctions were imposed.
“It also allows BCS to pass on the Alfa Nero gratuity to the crew that was agreed upon before sanctions were imposed,” adds Medd. Due to the nature of the sanctions, however, Burgess is unable to pay any salaries for any work or services that occurred past the date of the owner’s designation.
Whilst the immediate payoff for the crew may offer some relief, there is still more red tape ahead. A large proportion of the money held to pay the crew is in US dollars and authorities require any transaction using US dollars to have an Office of Foreign Asset Control (OFAC) license first.
Despite this, Burgess remains hopeful that both crews will be paid in full before the end of the year. “BCS is also applying for a license to release the money from the Policy & Resources Committee in Guernsey,” says Medd. “One crewmember asked if they would receive interest on the money owed, but I explained that it is illegal to provide interest in sanctioned money.”
Both Alfa Nero, the 82m Oceanco yacht and 108m Benetti Luminosity allegedly belong to sanctioned Russian oligarch, Andrei Guryev. Alfa Nero has been at the centre of a heated ownership dispute in Antigua, whilst Luminosity has been quietly docked at Porto Montenegro for over a year.
The former head of PhosAgro, one of the world's largest producers of phosphate-based fertilizers, Guryev was sanctioned by the UK, EU and US shortly after the invasion of Ukraine and is worth around $9.10bn according to the Bloomberg Billionaire Index.
Despite the breakthrough, Medd does not believe the development to be emblematic of more governments allowing similar processes for crew on sanctioned yachts.
“Without the OFSI license we could not apply for the OFAC or P&R licenses,” she says. “The reason it has taken so long to obtain the license is because OFSI did know what category to put the application under. We believe it has been processed under an independent heading. But this is our internal speculation.”
OFAC did not immediately respond for comment.
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