A superyacht linked to a Russian tycoon who has been subject to sanctions was permitted to anchor in Hong Kong, prompting the city's leader to declare that the financial center will not respect restrictions with "no legal basis."
Chief executive John Lee stated on Tuesday that the territory would abide by United Nations sanctions but would not take any action in response to unilateral measures.
"That is our system, that is our rule of law," Lee said. "We cannot do and will not do anything that has no legal basis."
Lee made the comment after the U.S. State Department warned that harboring the Nord could result in repercussions from the U.S. due to his participation in repressing dissent in Hong Kong.
"Hong Kong's reputation as a financial center depends on adherence to international laws and standards," a U.S. State Department spokesman said. "The possible use of Hong Kong as a safe haven by individuals evading sanctions from multiple jurisdictions further calls into question the transparency of the business environment."
Alexei Mordashov, one of Russia's wealthiest individuals and a close confidant of President Vladimir Putin, is the owner of the $521 million boat. His yacht made its way from Russia to Hong Kong last week. But it's not thought that Mr. Mordashov is on it. After Russia invaded Ukraine earlier this year, the U.S., U.K., and EU imposed sanctions on the tycoon.
In European courts, Severstal's chairman, Mordashov, has contested the sanctions and argued he had nothing to do with "the current geopolitical tensions." Severstal is the largest steel producer in Russia.
The administration of Hong Kong claimed that it was not subject to those measures. The multi-story Nord superyacht has been a noticeable presence in the city's Victoria Harbour for about a week now, with the Russian flag flying at its mast. The Nord, which has two helipads, and a pool, and is thought to be worth $500 million, has been in the partially independent Chinese region since Wednesday after stopping in the Maldives, Seychelles, and Vladivostok.
Prior to the megayacht's arrival in the city, officials in the Chinese territory declared that they would not implement any sanctions imposed by certain nations or groups. Some expensive yachts have traveled to countries with closer links to Russia, such as Turkey, to avoid seizure, despite the fact that US and European authorities have seized more than a dozen yachts thought to be owned by Russian businessmen who have been sanctioned.
China has refrained from denouncing Russia's conflict in Ukraine and has criticized Western-led sanctions against Moscow as an instance of "long-arm jurisdiction without a basis in international law."
