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Abu Dhabi, UAEWednesday 20 June 2018

Dubai court seeks to clarify future of $580m Russian superyacht

Hearing on Wednesday will challenge a freezing order linked to high-profile UK divorce settlement

Tatiana Akhmedova arrives at court which is considering legal issues in the divorce case against Russian billionaire businessman Farkhad Akhmedov, at a Court of Appeal hearing at the Royal Courts of Justice in London Thursday Feb. 1, 2018. Akhmedova was awarded Pounds 453 million (US 645 million dlrs) in divorce settlement, but according to her legal team no payment has yet been made. (Rick Findler/PA via AP)
Tatiana Akhmedova arrives at court which is considering legal issues in the divorce case against Russian billionaire businessman Farkhad Akhmedov, at a Court of Appeal hearing at the Royal Courts of Justice in London Thursday Feb. 1, 2018. Akhmedova was awarded Pounds 453 million (US 645 million dlrs) in divorce settlement, but according to her legal team no payment has yet been made. (Rick Findler/PA via AP)

The owners of a $540 million superyacht impounded at Dubai’s Port Rashid will challenge an order to freeze the asset during a court hearing in the emirate on Wednesday.

It is the latest twist in a complex matrimonial battle between Russian oil and gas tycoon Farkhad Akhmedov and his ex-wife Tatiana Akhmedova.

The High Court in London last month ruled that the 377-feet ‘Luna’ yacht, bought by Mr Akhmedov from Chelsea FC owner Roman Abramovich in 2014, should be given to Ms Akhmedova in an attempt to recover a $641m divorce settlement awarded to her in 2016. Her lawyers argue she has not received the full sum.

Luna is the 23rd largest luxury yacht in the world and boasts two helipads, a 20-metre outdoor swimming pool, a mini-submarine and 10 VIP guest cabins.

Agents acting on behalf of the English court petitioned Dubai International Financial Centre (DIFC) Courts to take control of the yacht and on February 8 it agreed to freeze the asset.

But Mr Akhmedov argued that DIFC Courts is not the correct jurisdiction to rule over the matter. He has also repeatedly maintained that he does not recognise the UK High Courts’ original decision as the divorce took place in Russia and there is no legal record of the case being transferred to the UK.

In a judgment in March, DIFC Courts upheld the freezing order, stating that Mr Akhmedov had tried to “evade enforcement” of the yacht by moving it to a dry dock in Dubai “well beyond the reach of an English Court judgement” in October 2017.

MUGLA, TURKEY - AUGUST 16: Luxury yacht of Russian businessman Farkhad Akhmedov is seen anchored at Bodrum in Mugla Province of Turkey on August 16, 2017. (Photo by Ali Balli/Anadolu Agency/Getty Images)
The luxury yacht of Russian businessman Farkhad Akhmedov is seen anchored at Bodrum in Turkey in August 2017. Ali Balli / Getty Images

But in April, Mr Akhmedov won the right to appeal the seizure through DIFC Courts, in a hearing taking place on Wednesday. The claimants are Straight Establishment, a Liechtenstein-based trust fund that is the official owner of the superyacht.

DIFC Courts, located in Dubai’s financial free zone, is an ‘offshore’ jurisdiction based on international common law. As Luna is impounded at Port Rashid, an ‘onshore’ location, any decision to uphold the order would have to be transferred to Dubai Courts to enforce before the yacht could be handed over to Ms Akhmedova.

Mr Akhmedov and his ex-wife, both Russian citizens, were married in Moscow in 1993 and divorced there in 2000. At the Moscow hearings, Ms Akhmedova produced a letter admitting she had been unfaithful – forbidden under Islamic sharia law – as the cause of the divorce, a spokesman for Mr Akhmedov said.

“Dubai and the UK have different and distinct religious, cultural and societal traditions that are respected by both countries,” said a statement issued on May 7 by Mr Akhmedov’s spokesman. He hopes judges will “see through his ex-wife’s transparent attempts to mislead the courts in Dubai”, it said.

“If Luna is not released swiftly to its rightful owner, the family trust, then the fight for justice in Dubai alone will continue for as many years as it takes.

“Sadly, by that time, the condition of the yacht may have depreciated to a value considerably less than the cost of the legal fees. The same will go for any litigation brought in this case in any legal jurisdiction, anywhere in the world,” the statement added.

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