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Hong Kong
CNN
—
A megayacht linked to a sanctioned Russian oligarch has dropped anchor in Hong Kong, amid efforts by the West to seize the luxury assets of Russian elites in allied ports as the war in Ukraine drags on.
The Nord, a nearly 142-meter (466-foot) yacht that is said to be one of the world’s largest, was spotted by CNN on Friday in Hong Kong’s waters, just minutes from the central downtown district. The vessel is estimated to be worth at least $500 million and widely believed to belong to Alexey Mordashov, an industrial billionaire, according to a yacht broker who spoke with CNN.
The yacht, 1.5 times the size of an American football field, arrived in Hong Kong on Wednesday from the Russian port of Vladivostok, according to the Chinese city’s Marine Department. The government agency told CNN on Friday that it hadn’t been notified about when the yacht would depart for its next destination.
As of Friday afternoon, the Nord was seen flying a Russian flag, with the name of its home base, “Vladivostok,” emblazoned on its stern. A few people, apparently crew members dressed in uniform, were spotted on the vessel’s deck.
Mordashov is one of Russia’s wealthiest billionaires, with an estimated net worth of $18.7 billion, according to the Bloomberg Billionaires Index. That’s down by $10 billion so far this year, according to the wealth tracker.
The tycoon is chairman of Severstal, a Russian steel and mining giant that at last count had 54,000 employees across 69 countries.
The US State Department sanctioned him and Severstal in June, in addition to three of Mordashov’s other companies, his wife and two adult children.
In a statement at the time, US Secretary of State Antony Blinken said that the Treasury Department was taking further action to “degrade the networks allowing Russia’s elites, including President [Vladimir] Putin, to anonymously make use of luxury assets around the globe.”
But the United States isn’t the only country cracking down. Several superyachts tied to Russian businessmen have been seized this year in high-profile cases around the world, including in Spain, Germany and the United Kingdom.
Mordashov has challenged sanctions against him in European courts. In May, he argued that an EU court should annul the decision to add him to a list of those penalized over the Russian invasion of Ukraine, according to European Union filings.
“I have absolutely nothing to do with the emergence of the current geopolitical tension and I do not understand why the EU has imposed sanctions on me,” he said this spring, at the beginning of the war, according to TASS, Russia’s state news agency.
Hong Kong may provide some refuge. Reached for comment by CNN on Friday, the Hong Kong Marine Department said that it would “not comment on any individual cases of vessel entry.”
The city requires overseas yacht owners to gain permission from authorities to enter, including showing proof of insurance, according to the Marine Department.
“We note that certain countries may impose unilateral sanctions against certain places on the basis of their own considerations,” it said.
But the government “does not implement, nor do we have the legal authority to take action on, unilateral sanctions imposed by other jurisdictions,” the department added, saying only that it would enforce “sanctions imposed by the United Nations Security Council.”
On Tuesday, Hong Kong leader, Chief Executive John Lee, said the city had “no legal basis” to act on Western-imposed sanctions – referring to the United States– but “will comply with any United Nations resolution on sanctions.”
Lee himself is among nearly a dozen people sanctioned by the US in 2020 for undermining the city’s autonomy and democratic processes, to which he described as a “a very barbaric act” on Tuesday.
“Hong Kong respects the rule of law. As an international financial city, Hong Kong’s regulatory system is on par with international standards. We will not do anything that has no legal basis,” Lee said.
Russia and China — of which Hong Kong is a part — are two of the five members on the Security Council with veto power. Russia has consistently vetoed resolutions on the council in recent months, impeding action on Ukraine.
Severstal did not immediately respond to a request for comment from Mordashov on Friday.
MarineTraffic, the global maritime analytics provider, shows that the Nord arrived in Hong Kong this week after a seven-day journey through the Sea of Japan and East China Sea.
It’s hard to know exactly why the crew chose to come to the Asian hub now, said Michael Maximilian Bognier, a yacht broker with Next Wave Yachting in Hong Kong.
But he noted that the port of Vladivostok could get relatively cold in the winter, making it tougher to maintain such a vessel.
“Not [an] ideal climate to keep a boat like that,” Bognier told CNN.
Asked whether the lack of sanctions could be a draw, Bognier acknowledged the current political climate wasn’t helping.
“This could be a reason why she’s here,” he said, referring to the yacht. “It could be a free ticket.”
It’s rare to see proof of direct ownership of such lavish vessels. Bognier noted, however, that word usually got around about top industry sales and said it was common knowledge that Mordashov was the owner of the yacht.
“Running a boat this size is almost [like] running a city or a business,” he added.
The Nord was built by German shipping giant Lürssen.
“This is definitely one of the most iconic yachts,” said Bognier. “It’s got a very flat bow, not unlike an aircraft carrier actually. That’s a very distinctive feature about this yacht. So it’s very, very difficult, let’s say, to mistake it for something else.”
Sky-high carrying costs could make it tough for even the world’s wealthiest to maintain such assets. Bognier estimated that it could range from approximately $45 million to $70 million just to keep the yacht running each year, not factoring in variable costs of fuel or maintenance after any long journeys.
That would break down to an average bill of $100,000 to $200,000 a day.
The Nord yacht boasts two helipads, and would likely have an extensive staff on board, including a full-time chef, fitness instructor, massage therapist, and possibly a helicopter pilot, according to Bognier.
“When we talk about boats this size, these are standard items,” he said.
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