Roman Abramovich sanctions threaten Chelsea’s financial viability, corporate bank accounts frozen per report

The situation around Chelsea  remains fluid a day after the club was essentially frozen as an asset when the U.K. government sanctioned Roman Abramovich along with other Russian oligarchs. Now, a sale of the club, while possible, would require a new license from the U.K. government who would oversee the transaction and ensure that Abramovich receives no funds from the deal.

The sanctions make running of the club almost impossible as they cannot sell new tickets, renew contracts, register new players or spend more than £20,000 thousand on travel to away matches. Due to the uncertainty around the club, telecommunications company Three have considered suspending their sponsorship and requesting that their branding be removed from around Stamford Bridge. Though recent reports suggest that even though the deal is suspended, the branding will say for now.

According to the Times, things could get worse before they get better as banks have frozen some of the club’s corporate accounts and credit cards due to the risk involved.

“The license allows the club to continue with day-to-day activities but the banks don’t have the risk appetite for it,” a source told the Times. “They’ve frozen some of the corporate credit cards. It’s put a lot more pressure on the club.”

On the other hand, some relief could be coming as the U.K. plans to loosen some restrictions on the club so that they can continue their day-to-day operations. There have been meetings since the emergency license was issued Thursday to see if looser restrictions could be enacted to prevent Chelsea from landing in administration. 

The big sticking points are the away match travel fees and the £500,000 cap on what can be spent on matches hosted at home for the Club. According to what club sources told the Financial Times, both of those caps are lower than the fees required to travel to and host matches so with the clubs funds frozen on incoming revenue, it would make for a situation where Chelsea would eventually run out of money.

There is a chance that restrictions could be lifted on who could attend matches with the Premier League distributing tickets to away fans coming to Stamford Bridge but these alone wouldn’t ease all concerns. Chelsea could still lose more sponsorships as Hyundai are assessing the situation and Nike hasn’t commented yet.

After leading the charge behind Abramovich being sanctioned, Labour MP Chris Bryant spoke to the times about sponsorships saying,

“I’m a bit perplexed that they haven’t all run a mile,” Bryant told The Times. “I certainly think they should, and suspend their commercial agreements, until the matter is resolved.”

When these are the comments coming from Parliament, it feels like only a matter of time until more dominoes fall when it comes to sponsors. Stamford Bridge officials will hope that today’s talks prove fruitful or Chelsea could fall into financial difficulty unless a buyer is found sooner than later. While there is no shortage of suitors, time isn’t on the Blues side.