Karlovy Vary spa put under Czech sanctions list, but continues to operate

Despite the owner of the Karlovy Vary spa Savoy Westend, Vladimir Yevtushenkov, being placed on the Czech sanctions list earlier this year, a report from Seznam Zprávy finds that the spa has recently been granted concessions by the authorities, allowing it to continue its operations and welcome guests.

Two months ago, the spa faced imminent closure after the Czech government imposed sanctions on Yevtushenkov, a Russian oligarch with close ties to Russian President Vladimir Putin. These sanctions resulted in the freezing of Yevtushenkov's assets, making it impossible to process payments or accept new bookings.

But the situation has taken a turn. The spa has received concessions from the state, enabling it to keep its doors open despite the owner's frozen assets. According to Ladislav Špišák, the medical director of the sanatorium, they can once again accept clients, but all financial transactions are now under the scrutiny of the Czech Financial Analytical Office (FAÚ).

"We are actually under state supervision. The FAÚ is checking us," Špišák confirmed. "We accurately account for the flow of money, both inflows and all outgoing payments. Twice a month, we have to inform the office about everything. In any case, there is certainty that the money does not flow to Russia or anywhere else. And I agree with that; it's right," he commented on the newly implemented sanctions regime.

While the Ministry of Finance, overseeing the FAÚ, has not commented directly on billionaire Yevtushenkov's Savoy Westend hotel, it has indicated that sanctioned entities can request adjustments to the sanctioning regime through administrative proceedings. This approach aims to ensure that international and national sanctions are applied consistently while minimizing harm to the Czech economy and public interests.

The temporary closure of Savoy Westend for approximately six weeks resulted in the loss of a significant portion of its clientele, with medical director Špišák stating that it's challenging to win them back. The occupancy rate currently stands at only 25 percent, despite substantial price reductions.

Despite these concessions, one major obstacle remains: banks still do not allow card transactions, forcing guests to pay in cash. Additionally, the hotel is not listed on the Booking.com reservation system. These factors have contributed to a 30-percent reduction in staff, with around 80 employees remaining out of the original 120.