On 28 May 2013, The Court of Justice (sitting in Grand Chamber in Case C-239/12 P) ruled that a person delisted from an EU sanctions list in the course of proceedings still has an interest in the proceedings continuing.
Mr Abdulrahim was designated by the UN Security Council 1267 Committee in 2008, and therefore by the European Union, implementing the UN listing in in the EU in Regulation 881/2002 (the Al Qaida list). He applied to the General Court to annul his EU designation. The UN Security Council removed his name from the 1267 list in 2010 and he was therefore deleted from the EU list in 2011. The General Court held that his action for annulment was devoid of purpose, and that there was no need for the Court to adjudicate on it because he had been deleted from the list by the European Council before his case reached judgment.
The Court of Justice followed the opinion of Advocate General Bot (see earlier blog dated 27 January 2013) and has decided that despite being removed from the list, his interest in the annulment proceedings continues, to allow him to try to obtain a declaration from the Court that he should never have been included on the list, and thereby some form of reparation and rehabilitation. The Court emphasised that impact on the rights and freedoms of listed individuals and their families as well as the reputational damage caused by placing a person on an EU sanctions list alleging association with a terrorist organisation, even where an applicant is already on a UN list.
This overturns the Court’s previous jurisprudence (in cases like Bredenkamp) to the effect that de-listed people have no continuing interest in annulment proceedings. Mr Abdulrahim’s case has now been referred back to the General Court for it to rule on his application for annulment.
The United Kingdom has asked the European Council to add Hezbollah’s military wing to the list of organisations on the European Union’s counter-terrorist sanctions. According to the Financial Times and Reuters, this follows the preliminary results of Bulgaria’s investigation into a bomb explosion in Burgas in July 2012, killing 5 Israelis and 1 Bulgarian and injuring 32 others, which apparently indicates that Hezbollah organised the attack. The EU will consider the UK’s request on 4 June 2013. If granted, it is likely to mean EU-wide asset freezes and travel bans for identified members of Hezbollah’s military wing.
Iran Transfo has won its case in the General Court of the European Union (Case C-392/11). The Fourth Chamber of the Court (which hears most of the Iran sanctions cases) held on 16 May 2013 that the Council had made a manifest error in its assessment that Iran Transfo was involved in the construction of the Fordow (Qom) facility. Although the Court held that the reasons given in the EU sanctions measures were clear enough to be understood, they were unsupported by any evidence.
There are two interesting aspects of the judgment. First, the Court rejected the Council’s argument that there should be a less intense standard of judicial review for sanctions measures aimed at the policies of a regime (such as Iran) as compared with sanctions aimed at terrorist activities. Second, the Court rejected the Council’s argument that it could not be expected to provide evidence because of the inherently secret nature of nuclear activities, and noted that the Council had not identified what evidence was confidential in this case. The Court analysed the case law of the European Court of Human Rights on secret evidence (Chahal, Ocalan, Jaspers), and reaffirmed the principle that it is central to effective judicial review that the Council provides evidence justifying a designation, on the basis of facts existing at the time of the decision to add a company to the sanctions list. The Council is making increasing reference to classified and confidential evidence, which may explain the General Court’s proposals for rule changes to deal with evidence of that kind (see previous blog on this issue).
The annulment of Iran Transfo’s listing came into effect after the two month time limit for the Council to appeal to the European Court of Justice expired, as this UK Treasury notice of 30 July 2013 makes clear. Link to the judgment here (in French, not yet available in English).
This article (by Maya Lester and Fred Hobson, Brick Court Chambers) in the Journal of International Banking and Financial Law discusses the position of Iranian banks and European sanctions. It summarises the scope of sanctions on the Iranian banking sector, the recent European court cases concerning Iranian banks, and identifies issues likely to arise in the near future.
The European Parliament has been asking the European Council for some time to impose sanctions on Russian individuals said to have played a role in the death of Sergei Magnitsky. Mr Magnitsky was the lawyer for Hermitage Capital Management Ltd and had alleged corruption amongst senior Russian enforcement officials when he was arrested and died in prison in November 2009. There is evidence that he was tortured and beaten shortly before his death.
On 14 December 2012, President Obama signed into law the Sergei Magnitsky Rule of Law Accountability Act, which imposes asset freezes and visa restrictions on 18 Russian officials said to have play a role in Mr Magnitsky’s death. The Liberal Group of MEPs is now threatening to block legislation in the European Parliament unless the Council imposes European travel bans along similar lines. Former Belgian Prime Minister Guy Verhofstadt stated that “the European Union should follow the US Congress and Senate in adopting a sanctions list. If the European Council fails to act in this regard, then the European Parliament should establish its own list based on the US Congress visa ban list“.