Russian billionaire launches fresh appeal of Canadian sanctions listing after wife removed

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A Russian billionaire, whose legal efforts have already resulted in the Canadian government dropping his wife from its sanctions list, is continuing to press Ottawa to remove his name as well.

It’s been nearly one year since Andrey Melnichenko was hit with Canadians sanctions, along with his wife Aleksandra. He first filed an appeal in the Federal Court in March, 2023, and in February this year, he filed another.

His previous legal challenge yielded some success. Last November, Ottawa removed his wife from the Canadian sanctions list.

Canada, like many other countries in the West, applied sanctions to hundreds of individuals and companies in Russia and close ally Belarus, over Moscow’s February, 2022, assault on Ukraine.

When Ottawa slapped sanctions on Mr. Melnichenko and his wife last year, they were among a diverse group of more than 100 targeted. Ottawa said at the time the group comprised “parliamentarians and officials, their family members, the oligarchs, and the businesses that fund them” who continue to do the bidding of Russian President Vladimir Putin.

Global Affairs spokesman John Babcock confirmed Aleksandra Melnichenko was removed from Canada’s sanctions list.

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“Designated persons may apply to the Minister of Foreign Affairs to have their name removed from Schedule 1, 2 or 3 of the regulations,” he said. “A detailed description of the relevant circumstances and reasons supporting an application for delisting are required.”

He declined to discuss Mr. Melnichenko’s legal action or elaborate on the removal of the businessman’s wife. But a source familiar with Aleksandra’s case said the fact she was a Serbian citizen with a Serbian passport played a role in her removal from the list.

The Globe is not identifying the sources because they were not authorized to discuss the matter.

In his 2024 appeal for judicial review, Mr. Melnichenko says he was advised by the Department of Global Affairs that he was listed because “there were reasonable grounds to believe he was an associate of President Putin or the government of Russia.”

Among the reasons given by the department were his role as former owner of fertilizer producer EuroChem and Siberian Coal Energy Company (SUEK), that he was a board member of the Russian Union of Industrialists and Entrepreneurs (RSPP), and that he attended a meeting with Mr. Putin and members of the RSPP after the start of the 2022 assault on Ukraine.

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Sanctions trackers including one set up by a Ukrainian government agency show the Russian billionaire has been targeted for sanctions by jurisdictions including the United States, European Union and Britain.

Mr. Melnichenko’s counsel in Canada did not return a request for comment.

Being placed on Canada’s Russia-related sanctions list means any assets of the named person in Canada are frozen. People in Canada and Canadians outside of this country are prohibited from providing financial services to those under sanction or entering into or facilitating transactions with them.

Lawyer John Boscariol, head of McCarthy Tétrault’s trade and investment group, said those sanctioned in Canada might also face the prospect of the federal government seizing and selling off their assets with the proceeds donated to Ukraine, as Ottawa has proposed doing. People sanctioned are also banned from entering Canada.

Mr. Melnichenko, who says he ceased to live in Russia more than a decade ago and has resided in Switzerland for 15 years with his family, alleges that Global Affairs has ignored evidence he presented to them to dispute its characterization of him.

He argues he built his wealth without the help of the Russian state and “as such does not meet the definition of ‘oligarch’.” Mr. Melnichenko said he has not been an owner of EuroChem or SUEK since 2006. He said he has no personal relationship with Mr. Putin or the government of Russia “and does not belong to the inner circle of President Putin.”

Mr. Melnichenko’s latest legal filing also said he presented Minister of Foreign Affairs Mélanie Joly’s department with evidence demonstrating he has the support of prominent Western experts “and Russian opposition leaders” against the imposition of sanctions on him.

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He argues his role in the Russian Union of Industrialists and Entrepreneurs “is unrelated and not in support of the Russian regime.” Likewise, he said, his attendance at meetings with Mr. Putin as a board member of the RSPP “does not indicate an association with the Russian regime.”

He said his application for reconsideration was denied by Ms. Joly on Jan. 15, and she rejected it, according to his legal claim, on the basis that he remains a board member of the Russian Union of Industrialists and because in that role he was called to two meetings with Mr. Putin: on Feb. 24, 2022 and March 16, 2023. “The minister determined that this evidence alone was sufficient to indicate an ‘association’ with the Russian regime,” his court application said.

As of Friday, Mr. Melnichenko sat at No. 74 on Forbes’s Real-time Billionaires list with an estimated net worth of US$25-billion. His superyacht was seized in 2022 by Italian authorities as part of EU sanctions.

Benjamin Schmitt, senior fellow at the University of Pennsylvania Department of Physics and Astronomy and Kleinman Center for Energy Policy, who has twice testified before parliamentary committees on sanctions, said he doubts Mr. Melnichenko will be successful in his bid for removal from Canada’s list.

“This is due in part to the basic fact that Mr. Melnichenko has been included in primary sanctions packages targeting Russian elites in a variety of jurisdictions around the globe,” he said. “While Mr. Melnichenko attempts to argue that he is not a Kremlin insider or close confidant of Russian President Vladimir Putin, Western sanctions compliance officials may find that difficult to believe given that Melnichenko has been listed as one of Russia’s top-ten richest individuals,” he said.

Mr. Schmitt argued it would be difficult to hold such status “without at least tacit approval from the Kremlin, especially given Moscow’s brutal practices vis-a-vis Russian business elites over the years to ensure regime loyalty.”

He added: “These considerations, along with the context of Russia’s continued aggression against Ukraine, hybrid warfare campaign against Western democracies, and the murder of opposition leader Alexey Navalny, means that Canada is unlikely to rule in Mr. Melnichenko’s favour for sanctions removal any time soon.”