French Court Rules Against Chelsea Owner Roman Abramovich in Tax Dispute

Chelsea owner Roman Abramovich has lost a battle with French tax authorities over money owed on his Chateau de la Croe villa located along the Cap d'Antibes in southern France.

Abramovich is said to owe £1.2 million in wealth tax on the property valued at £87 million (€100 million), according to Henry Samuel of the Telegraph.

The ruling is related to back taxes owed from 2006 and 2007 that Abramovich has disputed.

Abramovich will be asked to pay the outstanding money after a court ruled he had undervalued the property. Samuel described how authorities put a fee of "€41,000 per square metre" on the villa, a price "roughly double" what Abramovich had estimated.

The fees were set by comparing the Chateau de la Croe with other luxury retreats in the lucrative region dubbed Billionaires Bay. Abramovich's lawyers challenged this process along the lines of disputing the choice of villa's used for comparison.

BEN STANSALL/Getty Images

The 51-year-old Russian-Israeli's legal team contended properties such as the Villa Fiorentina weren't a realistic comparison. Samuel noted how Villa Fiorentina had many famous former owners, including the Kennedy family, Greta Garbo and Elizabeth Taylor, and eventually sold for more than "€73 million, value added tax included."

A French court said comparing Abramovich's holiday home to properties like the Fiorentina, located in Cap Ferrat, was valid. The ruling was reached because both Cap Ferrat and Cap d'Antibes can be classed as locales "reserved to a wealthy few."

One of Abramovich's other main lines of defense had been the fees he'd spent to renovate his villa, once home to King Leopold III of Belgium. These include €30 million used in 2005.

This didn't impress the court, though, which cited rebates in 2005 and '06 as proof the renovation fees had been accounted for in the per-square-metre assessment.

The ruling, handed out on September 26, is one more setback for Chelsea's owner, who has endured a tumultuous few months.

Chris Brunskill Ltd/Getty Images

He was denied a visa for the UK back in May, a decision possibly behind the temporary cessation in June of plans for Chelsea to build a new stadium, according to former Blues board member Christian Purslow.

Last month, the Switzerland government denied Abramovich's bid for residency. The country's federal police cited "suspicion of money laundering and presumed contacts with criminal organisations" and also believed "the applicant's assets are at least partially of illegal origin."

So far, Abramovich's troubles have not impacted Chelsea on the pitch, with the team third and unbeaten in the Premier League, level on points with leaders Manchester City and third-placed Liverpool.