March 21, 2013

Guest Post: Maya Lester on the Standard of Review in Sanctions Cases -- AG Bot's Opinion in Kadi II

This guest post is by Maya Lester (Brick Court Chambers), who is acting for Yassin Kadi in his continuing litigation before the Court of Justice of the EU.  The post originally appeared on the European Sanctions blog and is cross-posted here with permission (HT Gráinne de Búrca, NYU Law School).

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On 19 March 2013, Advocate General Bot (the French Advocate General at the European Court of Justice) handed down his Opinion in the Kadi II case (see here).

Mr Yassin Kadi was designated by the UN Security Council Sanctions Committee just after 9/11.  At the request of the United States, he was added to a list of people in UN Resolution 1267 that were alleged to be connected with bin Laden, Al Qaida or the Taliban. The European Union implemented that UN resolution in an EU Regulation which Mr Kadi challenged in an action for annulment, on the grounds that he had been given no reasons for his designation, no chance to make observations, and the regulation had no proper legal basis.


The Court of First Instance (Case T-315/01) held that the Court could not judicially review the EU measure for compliance with fundamental rights unless it violated ‘ius cogens’ (genocide, slavery etc), because to do so would violate the international legal order and the primacy of the United Nations.  On appeal to the Court of Justice (Case C-402/05), Advocate General Poiares Maduro disagreed with the CFI, stating (in a well known opinion) that the European Union is based on the rule of law, and its Courts must ensure that all acts of the EU institutions, including those that derive from international measures, comply with EU fundamental rights.  The Grand Chamber of the Court of Justice followed his opinion, and held (on 3 September 2008, in Kadi I) that Mr Kadi’s listing by the EU breached those principles since it provided no reasons, no evidence, and no opportunity to make representations.  This is now the leading judgment on the relationship between the EU and international legal orders, on EU fundamental rights, and on judicial review of sanctions designations.

After that ECJ judgment, Mr Kadi was re-listed by the EU in a new regulation, and this time was sent the UN’s summary of its reasons for his designation.  He brought a second action for annulment in the General Court (the new name for the CFI), Case T-8/509, and won.  The Court held that it was competent to review the EU measure, and that the summary of the UN’s reasons did not comply with the EU’s duty to give reasons because the reasons were too vague to permit Mr Kadi to respond meaningfully, he was given no evidence, and his comments were not taken into account.  The General Court said that the European Council had only paid “lip service” to the judgment in Kadi I and provided a “simulacrum” of due process, and that his re-listing was a disproportionate restriction on his property rights and reputation.

The Council, Commission, and United Kingdom all appealed against that judgment, and 13 Member States intervened in their favour.  Advocate General Bot’s opinion is a non-binding opinion in that appeal; the ECJ may or may not agree with him.  He has said that the General Court was right to hold (like the ECJ in Kadi I) that EU acts implementing UN resolutions are not immune from review by the Court, but that the General Court has applied the wrong standard of judicial review, and Mr Kadi’s rights were complied with.

The opinion focuses principally on the standard of judicial review.  The Advocate General thinks that the Court should “adapt” or “modify” its usual standard of review when it is dealing with counter-terrorist sanctions deriving from UN resolutions.  It should carry out a “limited” review of what he describes as the “internal lawfulness” of the EU measure, and a “normal” and “rigorous” review only of its “external” lawfulness.

The most obvious question arising from the opinion is what the Advocate General means by review of "internal" and "external" lawfulness.  On one view, "internal" refers to "procedural" grounds of review, and "external" to “substantive” or “merits” review.  The Advocate General suggests that "internal" review includes whether the EU act was adopted by means of a procedure that respects rights of defence (adequate reasons, a chance to comment, a chance for new information and evidence to be presented, and for comments to be “scrupulously examined” and taken into account). "External” lawfulness includes the “merits” of a designation decision, its evidential support factual accuracy, and proportionality.  In the Advocate General's opinion, these matters should be presumed to be correct, and should only be reviewed by the Court for “manifestly error”.

Of the numerous issues likely to arise from this opinion in addition to the standard of review, the following are a few.

First, the application of these standards of review to Mr Kadi's case.  The Advocate General briefly commented that in his view Mr Kadi was aware of the reasons for his designation in sufficient detail, and had not shown that the Commission had not examined his comments.

Second, Mr Kadi had already been de-listed by the UN and EU by the time these appeals were heard; the UN Ombudsperson proposed his de-listing to the Security Council and the EU delisted him in turn.  The Advocate General does not spend much time on this issue of the appellants’ continuing interest in the appeal.

Third, how far (if at all) the Advocate General’s views apply to “autonomous” and non-terrorist sanctions cases, given his comments that autonomous listings should rely on evidential assessments by national authorities, and his emphasis on the international UN context of his remarks.

Fourth, the Advocate General comments on the need for co-operation and information-sharing between EU and the UN Security Council; in his view, an intensive standard of review would result in less information being shared.
Fifth, he opines on whether decisions of the Security Council are now less “political” and “inter-governmental” given the existence of the UN Ombudsperson for the 1267 list.  In his view, the Ombudsperson’s role should result in a weaker intensity of review by the European court and (as the Advocate General would like) a “presumption of justification”.

The next step will be for the ECJ to give its judgment…

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