Brussels, 04/09/2008 (Agence Europe) - In a judgment delivered on 3 September, the Court of Justice of the European Communities ruled that the European Council had infringed the rights of Mr Yassin Kadi and the Al Barakaat Foundation to defence by freezing their funds without allowing appeals against the decisions. The judgment gives the Council three months to provide information on the reasons for its actions, otherwise the regulation in question will be definitively annulled.
MEP Baronness Sarah Ludford (ALDE, UK) welcomed the decision, a sign, she said, of a Europe “which really does guarantee fundamental rights, instead of just talking about them”. She added: “The fight against terrorism is difficult, but if we erode our fundamental freedoms in the process, we simply destroy the values we are battling to protect”.
The regulation under attack (No 881/2002) incorporates into Community law the list drawn up by the United Nations Security Council of persons and groups associated with Osama bin Laden, Al-Qaeda or the Taleban. Saudi resident Yassin Abdullah Kadi and the Al Barakaat International Foundation, which has it headquarters in Sweden, feature on this list, and, therefore, under Council measures, had their funds in the EU frozen. Initially having their cases dismissed by the Court of First Instance in 2005 (cases T-306/01 and T-315/01) Kadi and Al Barakaat on Wednesday saw their appeal upheld by the Court of Justice, since, the Court said, the decision of the EU Council of Ministers had infringed their right of defence.
Kadi, a businessman in Jedda and head of the Muwafaq Foundation, has been accused by American authorities of funding several Al-Qaeda units. The same is the case for Al Barakaat, which is seeking to recover almost one million Swedish krona (€100,000) frozen as a result of the regulation at issue.
The Court acknowledged that it is imprudent to give prior warning to those suspected of helping terrorists of sanctions being prepared against them. But this, the judgment points out, in no way prevents their being provided with full explanations once the measures have been put in place. Despite the express requests by the parties concerned, the Council did not explain its reasons, even after the implementation of the regulation, which, therefore, is annulled. The Council, however, has been allowed a period of three months before the decision to annul the regulation comes into force to give reasons supporting its decision and hear Kadi's and Al Barakaat's defence, if necessary. This period of time is needed, the Court acknowledged, to prevent the suspects from quite simply withdrawing their funds while awaiting a new regulation. One expert suggested that the Council could justify its action simply, saying that it had to comply with the terms of the UN resolution. The judgment makes no mention of the validity of such an argument.
Through this judgment, the Court confirms that, while Community courts have no jurisdiction to review the validity of UN resolutions, they can ensure compliance with Community law when they are transposed at EU level: “the Community judicature must … ensure the review … of the lawfulness of all Community acts … including review of Community measures which … are designed to give effect to the resolutions adopted by the Security Council under Chapter VII of the Charter of the United Nations”.
This is the first case relating to the transposition of the UN list, which contains some 370 persons and 60 organisations. According to one expert, this judgment could open the floodgates for other appeals, although, hitherto, there have been no intimations of appeals. The Council draws up two lists of terrorist organisations: one simply reproduces the list provided by the UN, while the other is drawn up by the Council itself. This latter is not affected by Wednesday's judgment, but is being challenged in a separate case on the inclusion of the People's Mujahedin of Iran (PMOI) (see EUROPE 9436). Recent amendments to the procedure relating to this second list could, according to a Commission spokesman, be used as a model for similar changes to be brought to the regulation that the Court found against on Wednesday. The Communities are also working, the spokesman said, on drawing up a general framework, which will allow those targeted to be heard and assure compliance with the right of defence. (C.D./transl.rt)