President Obama announces progress with China on cyber crime

At a joint press conference with Chinese President Xi Jinping held on Friday, President Obama announced that he had reached a “common understanding” with his counterpart on the issue of economic cyber espionage, with both governments agreeing not to engage in it. Though he recognised the “significant progress” that had been made on a matter that he told journalists “has to stop”, Obama cautioned that “The question now is, are words followed by actions?”, and emphasised that he is prepared to sanction Chinese persons who continue to engage in cybercrime.

Prior to President Xi’s visit, the US had prepared to unveil sanctions targeting Chinese companies it believed to be responsible for cyber theft of US intellectual property, under an order signed by President Obama in April (see previous blog).

UN sanctions 4 British nationals fighting with ISIL

camunFollowing a request from the UK government, the UN has sanctioned 4 British nationals said to be fighting with ISIS in Syria. The sanctions make them subject to a UN-wide asset freeze and travel ban.

The 4 people are:

  1. Sally-Anne Jones
  2. Aqsa Mahmood
  3. Omar Hussain (aka. Abu al-Britani)
  4. Nasser Muthana

Jones is said to be listed for using Twitter to recruit women for ISIS, giving advice on how to reach Syria, and inciting bomb attacks in the UK. Mahmood, described as a key member of the all-female ISIS al-Khanssaa brigade, is also listed for recruiting online and inciting attacks in Europe. Hussain has encouraged women and children to travel to Syria using social media, and said that he would only return to the UK to carry out a bomb attack. Muthana is believed to have appeared in ISIS propaganda videos.

This is the first time since 2006, when a member of al-Qaeda was listed, that the UK has requested the UN sanction its own nationals in this way. Speaking on Monday, a spokesman for Prime Minister Cameron said that the listings send “a clear deterrent message to those thinking of going to fight for ISIL”, and added that “we will continue to consider whether more individuals should be subjected to the sanctions”.

Ukraine & Russia trade airline sanctions

On Friday, Ukraine announced that from 25 October it would be banning flights operated by Russian airlines, including major carriers Aeroflot and Transaero, from its airports. In addition to airlines specifically covered by that ban, Ukraine has also said that a ban on entering Ukrainian airspace altogether will apply to any Russian flight carrying military hardware or troops.

In response, Russia has stated that as soon as the flight ban is confirmed it will introduce a retaliatory ban against two Ukrainian airlines. Aeroflot has since announced that it has received notification of the ban against it from the Ukrainian government.

Announcing the ban, Ukrainian Prime Minister Arseniy Yatsenyuk said that “Airlines with the Russian tricolor have no reason to be in Ukrainian airports”, and Russian Transport Minister Maksin Sokolov has since stated in respect of retaliatory sanctions that “We understand that this in fact will lead to a complete halt in air traffic between our countries”.

5 National Iranian Oil Company EU Court judgments

The General Court of the EU has just given a number of judgments on the 2012 listing of several entities on the EU’s Iran sanctions lists, on the grounds of alleged connections with the National Iranian Oil Company (NIOC).

NIOC itself lost its annulment action in July 2014 because the Court concluded that the Council was entitled to find that NIOC was owned and managed by the Iranian state and provided financial resources to the Iranian government and thereby fulfilled the listing criteria (see previous blog). That appeal is pending to the Court of Justice in Case C-440/14. Advocate General Cruz Villalón has just given his non-binding opinion (link here) stating that in his view the General Court was correct, and that the legal basis and proportionality arguments in particular should fail.

In the new cases concerning alleged NIOC subsidiaries:

  • Iran Liquefied Natural Gas Co won because it denied being a subsidiary of NIOC and the EU had no evidence to support its view to the contrary – see Case T-5/13 (link here).
  • Petro Suisse Intertrade Co SA (T-156/13 and T-373/14, judgment here) and Case T-428/13 Iranian Oil Company UK Ltd (judgment here) lost their cases because, although the reasons relied on a number of allegations, the Council only relied on those entities being owned and controlled by NIOC, which was undisputed.
  • Oil Pension Fund Investment Company won (Case T-121/13 – judgment here) because the Council had not submitted evidence to support its allegations that that company provided financial support to the Iranian Government.
  • National Iranian Oil Company Ptd Ltd and 16 other applicants in Case T-577/12 (link here) lost, because they had not denied that they were wholly owned by NIOC. The Court also rejected interesting arguments about (a) whether Article 291 TFEU was an adequate legal basis; and (b) whether provisions in the Iran Regulations were unlawful because they were too uncertain and vague.

In all these cases, as previously, the Court rejected reasons and proportionality challenges, rejected the Council’s arguments that state emanations have no EU rights, and maintained the annulled measures in force for 2 months / until the Council’s right of appeal has expired.

Serbia and Croatia trade sanctions in migration dispute

A dispute between Serbia and Croatia, following Croatia closing all but one of its border crossings with Serbia after almost 50,000 migrants crossed into Croatia from Serbia in just over a week, escalated yesterday as Serbia banned all imports of Croatian goods and Croatia responded by barring all vehicles with a Serbian licence plate from entering the country. Serbia had set a deadline of midnight on Wednesday for Croatia to lift a blockade on Serbian cargo that it implemented last week, and introduced the new sanctions when that deadline passed without Croatia reopening its borders.

Croatia has objected to the volume of migrants crossing its border, with Croatian Prime Minister Milanovic stating that more than 4000 to 5000 migrants entering the country per day “will not work, and I will not allow it”. It has blamed Serbia for transporting migrants to the border with Croatia, rather than moving them north towards Hungary. Croatia is a vital conduit for goods from Serbia to be transported into the rest of Europe, though Serbian Prime Minister Vucic believes that the financial losses caused by the sanctions will be high on both sides and added that Serbia “will not respond to the latest Croatian sanctions”.

US eases its sanctions on Cuba and Treasury publishes new FAQ

At the start of this week the United States brought into force changes to its Cuba sanctions regime, building on steps taken by the US Treasury and Department for Commerce in January to ease sanctions on the country (see previous blog).

The new changes further facilitate travel to Cuba for authorised purposes, broaden the existing general export licences for telecommunications and internet services, authorise certain US persons to establish a business presence in Cuba to facilitate authorised transactions, allow certain persons to open and maintain bank accounts in Cuba, authorise additional financial transactions, including remittances, and allow several other activities such as provision of legal services, provision of education, and the import of gifts. The general US trade embargo on Cuba remains in force.

In the US Treasury’s press release, Treasury Secretary Jacob Lew explained the changes by noting “the potential to create economic opportunities for both Americans and Cubans”, and the importance of supporting “the Cuban people in their effort to achieve the political and economic freedom necessary to build a democratic, prosperous, and stable Cuba”.

The Treasury has also published a new FAQ on US sanctions against Cuba, covering the most recent changes, how they will be implemented, and what they mean for persons within US jurisdiction.

EU Court annuls IRALCO’s sanctions listing

The General Court of the EU has annulled the inclusion of the Iranian Aluminium Co (Iralco) in the EU’s nuclear proliferation sanctions on Iran, in Case T-158/13 Iranian Aluminium Co v Council [2015].

IRALCO had been designated since 2012 for allegedly “assisting designated entities to violate the provisions of UN and EU sanctions on Iran”, for “supporting Iran’s proliferation sensitive nuclear activities”, and because Iralco “had a contract to supply aluminium to EU-designated Iran Centrifuge Technology Company”. IRALCO denied these reasons, and the Council put forward no evidence to support them, therefore IRALCO’s listing was annulled on the grounds that the Council had made an error of assessment. The Court also noted that the mere fact of high demand for aluminium for use in Iran’s prohibited weapons programmes did not necessarily mean that the applicant was supplying, or likely to supply, aluminium for this purpose.

As is usually the case, the Court gave the Council 2 months to remedy the errors identified in the judgment, during which sanctions remain on IRALCO. Maya Lester acted for IRALCO.

UKRAINE ADDS 382 PEOPLE AND 100 ENTITIES TO ITS SANCTIONS LIST

Ukrainian President Petro Poroshenko has added 382 people and around 100 entities to Ukraine’s targeted sanctions against persons said to be responsible for the uprising in the east of Ukraine and Russia’s annexation of Crimea. President Poroshenko stated that the new listings are in response to pro-Russian separatists, led by Alexander Zakharchenko, announcing that local elections would be held in the Donetsk region of Ukraine on 18 October, which the President described as “fake” and a “great danger”. The neighbouring region of Lugansk is due to hold local elections on 1 November, and both dates conflict with the Ukrainian government’s own plan to hold local elections on 25 October.

Among those newly listed by Ukraine are Russia’s Defence Minister, the Speaker of the Russian Parliament, pro-Russian “separatist” leaders in Ukraine, and a number of major Russian companies such as Kaspersky Labs and Gazprombank. Also listed originally were 6 Western journalists, including 3 BBC reporters working in Russia and 2 Spanish reporters believed to have been kidnapped in Syria, whose names have now been removed from the new list. EU Commissioner Johannes Hahn expressed his concern at the listing of journalists, stating that it was “not European in spirit”, though 28 journalists and 7 bloggers are still targeted under the new listings.

The full list of people and entities is here.