In the mid-2000s, a remarkable private yacht was built in Hamburg: the 162.5-meter-long "Eclipse", with its own cinema, disco, four motorboats and two helipads. It is considered the most expensive yacht in the world, and the order was placed by Russian oligarch Roman Abramovich, a super-rich man who is now under sanctions for his ties to Russian President Vladimir Putin, writes German public broadcaster ZDF on its website.
The yacht was supposed to function as a company
Investigations by several German, British and Austrian media outlets now reveal that while the yacht was being built, managers, financial advisors and lawyers developed a rather complex company structure in the background. The obvious goal: Abramovich to pay as little tax as possible on his yacht fleet. This created a web of companies to create the impression that the vessels were used for business purposes in order to obtain tax breaks. It is believed that “Eclipse” was part of this structure at least until 2012.
The question, which is still relevant today, is whether Abramovich managed to save millions in taxes in the EU in this way. Documents available to the media suggest that this was precisely the plan. Abramovich himself is not mentioned, but his advisers must have been aware of the matter. One of them wrote in coded correspondence that a “determined investigator” could unravel the complex structure created - with all the “possible consequences” of this. The same correspondence also reads: “We want to avoid paying VAT on the purchase price of the yacht”.
However, experts do not believe that taxes were evaded when buying the “Eclipse” because Abramovich used the then free port of Hamburg. From a tax point of view, it is not considered German territory, so VAT is not paid there (with some exceptions).
Different rules in different cases
However, the construction around Abramovich's yacht could interest the German tax authorities - in connection with the supplies of “equipment and supplies” for the yacht while it was under construction. In this case, the rules are stricter. And one of the Hamburg tax consultants who advised Abramovich's associates warns that he needs evidence of the company's use of the yacht.
If the “Eclipse” was not used for business purposes, its equipment is subject to German VAT. “The issue is urgent”, wrote one of the Russian oligarch's advisors shortly before the delivery of equipment worth several tens of millions of euros. This is true, because only foreign clients who also use the ship for company needs are not subject to taxation.
Many celebrities have visited the yacht
So far, neither the shipbuilders, nor the Russian oligarch's German tax advisors, nor the tax office in Hamburg have provided information on whether taxes were paid for the equipment in question for the yacht. But in principle, if it is proven that a taxpayer intentionally deceived with the purposes of using the yacht, this would be tax evasion.
Otherwise, it becomes quite clear from the newspapers what Abramovich used his yacht for: at his New Year's party in 2012, even the "Red Hot Chili Peppers" performed a concert on the deck. And the yacht was provided to famous names such as "Mourinho" - most likely the then Chelsea coach, as well as "Yeltsin" - probably the late former Russian president.
The documents show that fraud was probably also committed with the fueling of the yacht - since vessels used for commercial purposes can be exempt from fuel taxes in the EU. And in this regard, the question arises whether the oligarch's advisers did not evade taxes.
Abramovich denies everything
Through his lawyers, Abramovich states that he knew nothing about misleading the authorities - and could not have known. He has always trusted professional legal and tax advisers, so he could not bear personal responsibility. He could not remember the manager who warned him in 2005 about the "resolute investigator".
In the meantime, Abramovich has most likely withdrawn from the territory of the EU. Apparently for security reasons related to sanctions, the “Eclipse” is currently anchored off the coast of Turkey, protected from the intervention of European officials.
The “Cyprus Confidential” project
The revelations surrounding "Eclipse" are part of the global investigative project "Cyprus Confidential" , on which journalists from different countries are working. The focus of their attention is on dubious transactions passing through Cyprus. Internal documents from numerous Cypriot financial consultants show that sanctioned Russian oligarchs have used Cyprus as a kind of back door to the EU and the Schengen area.