WSJ News Exclusive | Abramovich Investment Vehicle Shifted Control Shortly After Russia Invaded Ukraine

Since that move, the U.K. has sanctioned Mr. Abramovich, accusing him of benefiting from the regime of Russian President Valdimir Putin. On Tuesday, the European Union followed suit. The sanctions subject Mr. Abramovich to asset freezes and travel bans in the U.K. and EU.

A person close to Mr. Davidovich confirmed he took control of the entity. Mr. Davidovich’s investment in Norma “is part of his overall investments and interest in the startup sector,” this person said. This person said Mr. Abramovich wasn’t Norma’s previous owner but didn’t identify who that was. Norma is linked to Mr. Abramovich in several public filings. For instance, in 2021, a U.S. biotech company backed by Norma said in its annual report filed with the Securities and Exchange Commission that Norma was controlled by Mr. Abramovich. A company filing in 2020 to the

London Stock Exchange

from

AFC Energy

PLC, a British fuel-cell company, also listed Mr. Abramovich as an indirect investor in the business “through Norma Investments Limited.”

Filings show the two men frequently invest in companies together. Mr. Davidovich is listed in some filings as the chief executive officer of Millhouse LLC, a Moscow-based investment firm Mr. Abramovich started two decades ago.

The shift in control of Norma comes amid a wider effort by the Russian billionaire to shed or move assets in recent weeks, after Western governments threatened to dismantle an empire Mr. Abramovich built up since the 1990s because of what they say are ties to Mr. Putin and the war in Ukraine. London, Brussels and Washington have all threatened to clamp down on a group of wealthy Russian billionaires such as Mr. Abramovich in the hopes of applying pressure on the Kremlin.

Sanctions lawyers say selling assets to associates or transferring ownership to family members can be a way to at least temporarily avert asset freezes, and retain indirect control of assets without technically falling afoul of sanctions. The British Virgin Islands, a British overseas territory where many of Mr. Abramovich’s companies are registered, must implement U.K. sanctions orders. Mr. Davidovich is not sanctioned. U.K. filings say he resides primarily in Israel.

Before being sanctioned in the U.K., Mr. Abramovich sought to sell his 15-bedroom mansion in London and his soccer club Chelsea FC. He has also tried to sell out of U.S.-based funds, The Wall Street Journal previously reported. Two of his megayachts recently moved out of harbors that could be subject to EU jurisdiction, according to ship-tracking sites.

The complex ownership structure of Norma Investments points to the challenge that U.K., U.S. and European officials face as they try to work out what assets sanctioned oligarchs control. U.K. officials say that once sanctions are in place assets that are controlled by the sanctioned individuals are frozen. The EU, U.S. and U.K. have begun sanctioning family members of oligarchs in part to capture transfers that may previously have taken place.

Norma Investments had served as a vehicle for venture-capital investments. Since 2018, Norma has owned MHC Services Ltd., a management consultancy working out of Chelsea FC’s offices, according to MHC’s accounts. Norma invested in U.S. renewable-fuel companies and acquired a stake in British energy company

Velocys

PLC, according to securities filings. Norma also funded cancer and anti-aging drug research by a U.S. biotech company,

Cleveland BioLabs Inc.,

which in a 2021 securities filing said Norma was controlled by Mr. Abramovich.

Shellanoo Group, an Israeli tech company that Mr. Abramovich invested in in 2015, said in a 2016 filing that Mr. Abramovich bought a stake through a company owned by Norma. It said Norma’s owner was A Corp-Trustee Ltd., the trustee of a Cyprus trust called Harmony Trust Settlement. It said Mr. Abramovich is the owner of the chain of companies. A Corp-Trustee also owns Mr. Abramovich’s London mansion, according to property records.

Many governments have powers to temporarily freeze assets of individuals or entities in their jurisdiction, without proving criminality, through sanctions or other measures. Owners are typically barred from selling or benefiting from them until sanctions are lifted or successfully contested. Governments typically can’t move to take ownership of the assets, though, except after often-lengthy legal proceedings that would require proof of lawbreaking. The U.K. government, however, is considering laws that would give itself the powers to seize sanctioned assets.

In sanctioning Mr. Abramovich, the U.K. government said he had benefited from the regime of Mr. Putin. Once a frequent visitor to London, he hasn’t been seen here much in recent years. He listed his address as Russia in a recent corporate filing.

In recent days Mr. Abramovich’s private jet has zigzagged between Israel, where he also has citizenship, Turkey and Russia, according to flight records. On Monday a masked Mr. Abramovich was photographed waiting in a VIP lounge in an Israeli airport. Representatives for Mr. Abramovich haven’t commented about the sanctions.

Mr. Abramovich’s 533-foot superyacht Eclipse was sailing along the Algerian coast in the Mediterranean on Tuesday afternoon, after leaving Philipsburg, in the Dutch Antilles in the Caribbean, according to vessel-tracking site FleetMon. The islands are a constituent country of the Netherlands, part of the EU.

Mr. Abramovich’s 460-foot My Solaris, meanwhile, was sailing in the Eastern Mediterranean, having left Barcelona and stopping briefly at Tivat in Montenegro, according to FleetMon. Spain is an EU member. Montenegro isn’t but has said it will follow EU sanctions. Several other superyachts, belonging to other sanctioned oligarchs, have been seized or detained in ports in France and Italy.

Shortly after the Russian invasion, Mr. Abramovich put his Chelsea soccer club up for sale. First bids are expected Friday, but U.K. sanctions prohibit him from benefiting from any proceeds from a sale. The U.K. government has granted the club a license to operate normally, with restrictions, while its owner is under sanctions. Mr. Abramovich is also prohibited from selling British property he owns.

—Benoit Faucon contributed to this article.

Write to Max Colchester at [email protected] and Margot Patrick at [email protected]