NEW GENERAL COURT RULES OF PROCEDURE IN FORCE, INCLUDING CLOSED HEARINGS

New Rules of Procedure of the General Court of the EU entered into force on 1 July.  These replace the existing rules, which were first introduced in 1991 and since then frequently amended.

The new rules include controversial provisions permitting closed procedures, on which see previous blogs here and here.  The provisions are set out in Article 105 of the new rules, and will in accordance with Article 105(11) apply  from the publication of a decision in the Official Journal establishing the security rules for protecting information or material produced under the article.

There are also new Practice Rules for the Implementation of the Rules of Procedure of the General Court (in force since 20 May 2015), a new legal aid form, and 3 aide-mémoires to help parties’ representatives (found here).

The General Court’s press release is here.

EU UPDATES ITS SANCTIONS BEST PRACTICES DOCUMENT

The EU has produced an updated version of the document EU Best Practices for the effective implementation of restrictive measures, which contains non exhaustive and non binding recommendations by the Foreign Relations Counsellors Working Party for Member States implementing EU restrictive measures.  The Best Practices document covers a number of issues relating to listing & de-listing on EU targeted sanctions measures, & national implementation of asset freezing measures. This amends the previous version, published in 2008. The most significant amendments are:

  1. The addition of a section on de-listing from United Nations sanctions lists.
  2. Clarification of the tests for “ownership” or “control” of an entity and “making funds available indirectly”, mirroring the Guidelines on Implementation of Restrictive Measures published by the EU in 2013.
  3. An explanation of the non-liability & no claims clauses in a number of EU sanctions Regulations, which provide that no liability is incurred for damages caused by sanctioning a person in accordance with EU measures, or for breaching sanctions where it was not known or there was not reasonable cause to suspect that the action would infringe restrictive measures.
  4. A statement that, unless otherwise specified, sanctions measures annulled by the European court remain in force for the 2 month and 10 day time limit in which an appeal may be brought and for as long as an appeal is pending.
  5. Clarification of some of the grounds for exemptions to asset freezes (licences), and of the process for transfer of funds between EU and non-EU financial institutions where sanctions are involved.

The Best Practices and Guidelines documents are on the ‘guidelines’ section of this blog.

UK EUROPE MINISTER SAYS NEW EU CLOSED PROCEDURES ARE PART OF ADAPTING TO “NEW JURISPRUDENTIAL REALITY” AFTER KADI

David Lidington MP gave evidence earlier in March to the House of Lords EU Select Committee on the proposed new procedural rules in the EU court to prevent classified or confidential material from being disclosed in court (an issue on which this blog has been reporting).

The Minister said the impetus for a new closed material procedure came from the Court and Member States after the Kadi judgments: “We thought that having a closed material procedure was a useful step forward in enabling the Council to protect key sanctions listings in a fashion which the court would find acceptable”, in order to protect intelligence material and confidential UN material. The Minister said: “I would argue that the outcome in Kadi was a blow to our ability to pursue an effective sanctions policy as a tool of wider foreign and security policy. CMP is part of adapting to that jurisprudential reality”.

The UK alone abstained in the Council vote on the new rules because of concerns that the originator of the information could not withdraw the information after a certain stage, and that there was no mechanism for checking inadvertent disclosure in orders & judgments. The Minister said that other Member States were less worried because they “do not have the capacity to reply confidential or secret information in support of sanctions listings” so did not have the UK’s concerns; there was a feeling that “this British issue was a bit outré”. The UK special advocate procedure apparently “never really caught fire” as a suggestion.

EU BELARUS SANCTIONS ON BELTECHEXPORT ANNULLED

HM Treasury has published a notice confirming that the EU asset freeze against BelTechExport has been lifted.

The lifting of the asset freeze follows a judgment of the General Court of the European Union, handed down on 9 December 2014, annulling the EU sanctions listing of BelTechExport from its Belarus sanctions (see previous blog).  The judgment was not appealed and so the annulment order has now come into force.

BelTechExport was listed on the basis that “It supports and provides revenue to the Lukashenka regime by its sale of arms”, “benefits from the regime as the main exporter of arms and military equipment owned by the state or produced by state owned companies”, and has ties to a listed individual, Vladimir Peftiyev.  The sanctions on BelTechExport were first imposed by Council Regulation (EU) 588/2011 amending Council Regulation (EC) 765/2006 and Council Decision 2011/357/CFSP amending Council Decision 2010/639/CFSP.

A list of EU sanctions in force against Belarus can be found in the “sanctions in force” section of this blog.

EU SYRIA SANCTIONS ON MAZEN AL-TABBAA ANNULLED

HM Treasury has published a notice confirming that the EU asset freeze against Mazen Al-Tabbaa has been lifted.

The lifting of the asset freeze follows a judgment of the General Court of the European Union, handed down on 25 August 2014, annulling the EU sanctions listing of Mr Al-Tabbaa on its Syria sanctions (see previous blog). The judgment was not appealed and so the annulment order has now come into force.

Mr Al-Tabbaa was originally listed on the basis that he was a business partner of two people “responsible for the violent repression against the civilian population in Syria”, and the owner of a currency exchange which “supports the policy of the Central Bank of Syria”.  The sanctions on Mr Al-Tabbaa were first imposed by Council Implementing Regulation (EU) 410/2012 and Council Implementing Decision 2012/256/CFSP.

Maya Lester appeared for Mr Al-Tabbaa in the General Court.  A list of EU sanctions in force against Syria can be found in the “sanctions in force” section of this blog.

EU MEMBER STATES APPROVE NEW EUROPEAN COURT RULES

On 10 February 2015, EU Member States approved changes to the rules of procedure of the EU General Court.  The proposed draft had been approved by “senior officials from EU governments” on 11 December 2014, as we reported on this blog.

This includes the new rule on which we have previously reported, changing the position at present which is that the Court requires all evidence submitted for a case to be seen by each party.  If the new rules are finally approved by the Court, in exceptional cases the Court may rule evidence admissible without being disclosed.

The changes were approved by 27 of the 28 EU Member States.  The UK abstained, voicing concern over the adequacy of safeguards in place under Article 105 to protect evidence submitted (as we previously reported); the new rules do not allow a party to withdraw material at any stage of proceedings, nor do they include any provision for security checking judgments and orders to prevent accidental disclosure.

US GOVERNMENT CONCERNED ABOUT EU SANCTIONS

According to the Wall Street Journal, the US ambassador to the European Union, Anthony Gardner, has reported that “the US government is increasingly concerned about weaknesses in the European sanctions mechanism” and criticised the speed of the EU response to the “key legal challenge the courts have posed: providing enough evidence to share with the courts to stand up its targeted sanctions against people and companies”.  The Ambassador said:

The EU has been slower to devote the additional resources needed to develop factual records that will withstand rigorous judicial scrutiny.  It has paid the price, most recently in the extraordinary decision by the Court in December of last year to annul the EU’s inclusion of Hamas in a list of terrorist groups. According to the Court, the EU had based its periodic relisting on “factual imputations derived from the press and the internet” rather than on its own analysis of the group’s actions. Some key member states, such as the UK, fully appreciate the problem; they have begun lending more experts to the European External Action Service and are providing it with better unclassified documentation.  The United States is also lending a hand by providing information and research support to the EEAS.

The Ambassador also reported that the US government is “encouraged” by the proposed rule change in the European courts to allow governments to provide sensitive intelligence information to the courts without it being shared with lawyers representing those challenging the sanctions – see previous blog:

Following several recent annulments by the Court of EU designations of Iranian entities, the EU has recognized the need for a change in the court’s rules to enable examination of classified information.  Although the divergence in member state legal traditions on the use of classified information in judicial proceedings has complicated the development of new common rules, approval appears to be within reach.  The United States is encouraged to see that the EU is strengthening its capability, administratively and judicially, to promulgate and sustain sanctions designations. This is not only of critical importance in our common efforts to combat terrorism and apply pressure on Iran, but also in our common efforts to apply pressure on Russia to change its aggressive policies toward Ukraine.

NEW EU COURT RULES TO BE ADOPTED WITHOUT UK APPROVAL

Further news on our post yesterday about new EU court rules…  The Europe Minister, David Lidington, has informed the UK House of Commons’ EU Scrutiny Committee (report here) that:

1) The proposed new rules for the European Court to take into account closed evidence have qualified majority support (i.e. the necessary support of Member States to be approved), and the Committee has cleared the rules from its scrutiny.

2) The UK will abstain from voting on the rules in the Council of the EU, because the rules do not meet UK requirements in two respects: (1) they would not enable confidential information to be withdrawn at any time; (2) they do not provide for judgments to be checked for accidental disclosure of sensitive information before being issued.  The UK will lodge a statement making clear that “the absence of these safeguards will limit the types of information that the UK will be able to submit to the Court and seeking a review of the mechanism in the light of practical experience.

3) The new measures enabling the Court to consider evidence not made available to the other party “are likely to be called upon in only a limited number of cases, since it is often possible to sufficiently justify restrictive measures using non-confidential information” and that “other Member States accepted the Court’s position that such special measures needed to be proportionate and did not push for an equivalent to the UK Special Advocate provisions.

4) He summarised how the proposed new Article 105 will work:

The party who does not have access to the material will at all times know that an application to treat information as confidential has been made by the other party, and will have sight of the non-confidential reasons cited for the use of a closed procedure. The Court will decide where material is relevant for the purposes of its decision and also whether that material is confidential for the purposes of the case.

If material is relevant and confidential, the Court will order what procedures need to adopted, such as the production of a non-confidential summary to be disclosed to the other party. At that stage, the party who has produced the evidence can withdraw it, but Article 105 makes it clear that in those circumstances, any material which is withdrawn will not be taken into account in determining the case. Only in narrow circumstances can the Court take into account material which is not disclosed to the other party. It will, however, always take into account, in its assessment of that material, that it has not been disclosed to the other party.

See our previous posts (e.g. here and here) about potential Article 6 ECHR concerns with these new provisions.