Judgment;Judgment (extracts) — ECLI:EU:T:2016:430
Date: 2016-07-21
Language of the case: English
Court formation: Eighth Chamber
Subject matter: Provisions governing the Institutions
Procedure: Action for damages - unfounded

summary of reasons underpinning Regulations No 77/2009, No 173/2010 and No 174/2011, in order to review whether those reasons, or, at the very least, one of those reasons, deemed sufficient in itself to support those regulations, are substantiated (see, to this effect, judgment of 21 April 2015 in Anbouba v Council, C‑630/13 P, EU:C:2015:247, paragraph 46). 71 Furthermore, in line with the action taken by the European Union at international level to promote democracy, the rule of law, human rights and the other principles referred to in Article 11 EU and Article 21 TEU, the restrictive measures at issue in the present case are intended to step up the political pressure on a foreign regime whose actions seriously undermine those principles by constantly threatening the survival of certain sections of the population. The freezing of the funds or other economic resources of any person, entity or body that is ‘associated’ with such a regime in the sense that that person, entity or body has a special relationship with the regime that contributes to its survival constitutes, according to Article 5 of Common Position 2004/161, Article 5 of Decision 2011/101 and Article 6 of Regulation No 314/2014, such a measure. 72 Accordingly, in carrying out the assessment of the importance of what was at stake, account may be taken of the context of the measures at issue in the present case, of the fact that there was an urgent need to adopt such measures intended to put pressure on the Zimbabwean regime in order for it to stop the policy of violence and large-scale intimidation directed against the population of that country, and of the difficulty in obtaining more specific evidence in a State in such a situation with an authoritarian regime. In such a context, the institutions concerned discharge the burden of proof borne by them if they present to the Courts of the European Union a set of indicia sufficiently specific, precise and consistent to establish that there is a sufficient link between the person subject to a measure freezing his funds and the regime being combated (see, to that effect, judgment of 21 April 2015 in Anbouba v Council, C‑630/13 P, EU:C:2015:247, paragraphs 47 and 53). 73 In the present case, first, the Council and the Commission contend that the first applicant is a businessman of considerable standing who has, of his own admission, continuously had a direct relationship with the regime in power in Zimbabwe. That relationship took the form of the first applicant’s involvement in sensitive political issues of major importance, such as the negotiations in connection with the agricultural land redistribution policy. According to a press report of 24 May 2002, the first applicant had connections that gave him privileged access to politicians, which justified his involvement as intermediary between the Zimbabwean Government and the Commercial Farmers’ Union of Zimbabwe, whose members were the target of the government’s land confiscation policy. Those connections are also apparent from the provision by the first applicant of services of a more personal nature, such as the provision of air transport to members of that government or their family members. The first applicant confirmed those facts in the appeal which he lodged with the Office of Foreign Asset Control (OFAC) of the United States Treasury. 74 Next, the Council and the Commission rely on the reports of 8 October 2002 and 15 October 2003 (see paragraphs 57 and 59 above). 75 It is apparent from the report of 8 October 2002 that, notwithstanding a diminishing in the intensity of the conflicts involving seven African armies within the Democratic Republic of the Congo, certain groups linked to the armed forces of the Republic of Rwanda, the Republic of Uganda and the Republic of Zimbabwe exercised economic control over certain areas of the Democratic Republic of the Congo and appropriated revenue from the extraction of diamonds, cobalt, copper and germanium under the pretext, for example, in the case of the Republic of Zimbabwe, of payment for security services provided by that State’s armed forces to the Government of the Democratic Republic of the Congo. That exploitation network, which, according to the report, involves Congolese and Zimbabwean politicians and government officials and businessmen, succeeded in transferring from the Congolese public sector ownership in mineral deposits with a value of at least 5 million US dollars (USD) over a period of three years. In that context, according to the report, the first applicant had the right to exploit, via Tremalt Ltd, a company he represents, rights in deposits held as concessionaire by Générale des carrières et des mines (Gécamines), a Congolese public company. Those deposits comprised 2 700 000 t of copper and 325 000 t of cobalt and the right to exploit them was granted for 25 years. The value of those deposits is estimated at more than USD 1 billion, the first applicant having paid to the Democratic Republic of the Congo only USD 400 000 for those rights. Tremalt participated in the operation in question through a joint venture with Kababankola Mining Company Sprl, in which Tremalt had an 80% share to Gécamine’s 20%, though the latter derived no tangible benefit from that operation. The Panel of Experts states that it has in its possession the confidential tripartite profit sharing agreement relating to the operation in question. Under that agreement, Tremalt retained 32% of the net profits, the remaining 68% being shared equally by the Democratic Republic of the Congo and the Republic of Zimbabwe. Under that agreement, which was the subject of a memorandum from the Zimbabwe Defence Minister to President Mugabe in August 2002, Tremalt undertook to supply the armed forces of the Democratic Republic of the Congo and the Republic of Zimbabwe with motor vehicles, trucks, buses and cash payments as necessary, the cost of so doing being deducted from the two countries’ profit share. Furthermore, Tremalt and the armed forces of the Republic of Zimbabwe established a forum ‘to look after the interests of the Zimbabweans’, consisting of a Zimbabwean General, Brigadier and Air Commodore, the first applicant and two other members of the Board of Kababankola Mining Company. The Panel of Experts refers to certain information relating to the exploitation of the deposits in question prior to the transfer to Tremalt. It also refers to the view of mining industry experts that Tremalt’s claim that it suffered significant losses between February 2001 and July 2002 lacks credibility. 76 Furthermore, according to the report of 8 October 2002, through his companies Aviation Consultancy Services and Raceview Enterprises, the first applicant was a major supplier of spare parts for military aircraft, camouflage cloth, batteries, fuels and lubricating oils, boots and rations to the Zimbabwean armed forces. 77 On that basis, the Panel of Experts included the names of Tremalt and the first applicant in Annex I and Annex II to the report of 8 October 2002 respectively as members of networks contributing, directly or indirectly, to the funding of the conflicts in question and in respect of which a wealth of information and documentary evidence had been gathered. Annex I is entitled ‘Companies on which the Panel recommends the placing of financial restrictions’. Annex II it entitled ‘Persons for whom the Panel recommends a travel ban and financial restrictions’. 78 In the observations which he submitted to the Panel of Experts in January 2003, the first applicant maintained that the confidential tripartite agreement for sharing the profits arising from the exploitation of deposits for which Gécamines enjoyed the concession in the Congo had in fact been signed but that ‘events overtook’ the agreement, which was not therefore ultimately put into effect. 79 After receiving and examining those comments and those submitted by the other parties concerned, the Panel of Experts adopted the report of 15 October 2003. Following discussions with the parties concerned, it divided them into five categories. The first category included the names of persons and entities with which the panel considered that it had found a solution that was in the interest of both the persons and entities concerned and the Democratic Republic of the Congo. The names of those persons and entities were to be regarded as having been removed from the lists in the annexes to the report of 8 October 2002. The Panel stressed that that resolution did not invalidate the information obtained previously on the activities of those parties, but simply meant that there were no outstanding issues and that the problems which led to their inclusion in the annexes to that report had been resolved to the panel’s satisfaction and to that of the undertakings and individuals concerned. 80 The second category included persons who had reached a provisional resolution with the Panel of Experts, subject to fulfillment of a number of commitments on corporate governance and the establishment of improved controls and procedures. Compliance with the commitments would be verified after the end of the panel’s mandate. That task was therefore entrusted to the ‘contact point’ of the Organisation for Economic Cooperation and Development (OECD) in the United Kingdom. It that regard, it is apparent from the document prepared by the panel entitled ‘Reaction No 25’ that the first applicant, Tremalt and the Kababankola Mining Company gave five series of undertakings concerning their cooperation with the Congolese authorities, the possible renegotiation of the terms of the joint venture agreement and financial transparency. Unlike the provisions made in respect of the first category (see paragraph 79 above), there is nothing in that part of the report of 15 October 2003 to suggest that the names of the persons and entities in the second category were to be regarded as having been removed from the lists in the annexes to the report of 8 October 2002. As a consequence, the report of 15 October 2003 does not have the effect of removing the name of the first applicant from the list of persons for whom the Panel of Experts proposed restrictive measures and a travel ban. 81 Lastly, the Council and the Commission refer to a series of public sources. 82 The Council refers to documents identified in the response of the United Kingdom authorities to the request for access to documents submitted by the applicants on 19 February 2009 (see paragraph 57 above). Those documents include articles available on the internet providing accounts of the first applicant’s relationship with the Zimbabwean Government as intermediary in negotiations for land redistribution, as fuel supplier in 2002, but also as supplier of arms and as intermediary in connection with mining in the Congo, according to the report of 8 October 2002. Reference is also made to a document of the Nederlands instituut voor Zuidelijk Afrika (Netherlands Institute for Southern Africa, the Netherlands) that is available online and provides certain information from public sources on the first applicant’s career path, his relationship with the regime of Ian Smith, his circumvention of international sanctions imposed on that regime, his tobacco trading concession business and his relationship with the regime of President Mugabe involving the supply of arms and fuel, mediation in the redistribution of agricultural land and involvement in mining in the Congo. Those activities are also covered by reports dated May 2000 and October 2002 produced by the Council. 83 The Commission, for its part, refers to press articles covering the first applicant’s involvement in the struggle for power within the ZANU-PF party in 2006 as financial backer of certain members of the government who were potential successors to President Mugabe. Moreover, those articles relate to the first applicant’s close ties with that president but also refer to an investigation subsequently launched by the Zimbabwean authorities into the first applicant. According to those reports, the first applicant fled Zimbabwe as a result of that investigation, although his associates claimed that he was on a business trip. 84 In those circumstances, it is clear that the institutions concerned have presented a set of indicia sufficiently specific, precise and consistent to establish that there is a sufficient link between the first applicant and the regime against which the restrictive measures in question were directed. The circumstances described in the texts referred to in paragraphs 82 and 83 above give grounds for believing that, for long periods of time, the first applicant had links with the Zimbabwean regime such as to enable him to pursue a broad range of activities from which that regime profited as a direct result. 85 Thus, contrary to the applicants’ assertions, the report of 15 October 2003 does not invalidate either the findings of fact or the conclusions of the report of 8 October 2002. On the contrary, according to the latter report, a recommendation remained in place that the first applicant be subject to financial restrictions and a travel ban, as his activities were still to be monitored (see paragraphs 79 and 80 above). Moreover, even if the confidential tripartite agreement for the distribution of profits arising from the exploitation of deposits for which Gécamines held the concession in the Congo was not put into effect (see paragraph 78 above), the fact that he does not dispute that the agreement was signed or the terms of the agreement is at odds with the first applicant’s central claim that the Zimbabwean Government had no connection with that investment and the first applicant has failed to adduce any evidence to explain the nature of that government’s involvement, albeit in an agreement that was not put into effect. 86 The first applicant’s claims that he was obliged by the Zimbabwean Minister for National Security to abandon his investment in the Congo no later than the end of 2004 and was persecuted by the Zimbabwean regime in 2006 cannot alter the conclusion set out in paragraph 84 above. 87 Indeed, even if the first applicant was obliged to dispose of his investment in the Congo at the end of 2004 and his relationship with the Zimbabwean Minister for National Security deteriorated subsequently, it is apparent from a number of press reports produced by the Commission dated 2006 and 2009 that he remained a business man who had an important relationship with ZANU-PF and other members of that party who were prospective candidates to succeed President Mugabe. 88 As regards the measures purportedly taken by the Zimbabwean Government against the first applicant following the part he played in the delivery of a letter proposing the retirement of President Mugabe, the first applicant’s argument is not convincing. First, as observed by the Commission, the fact that he was chosen to facilitate the delivery of such a letter to the President suggests that the first applicant was seen as an appropriate person to perform such a task in view of his relationship with the regime. Next, according to the apology letter annexed to the application and dated 18 July 2006, which the first applicant sent to President Mugabe, the first letter had been delivered to the President three years earlier. Questioned on that subject at the hearing, the applicants submitted that the reference to the first letter having been sent three years earlier is probably due to a typing error and that the author of the letter meant to indicate three months, not three years. Be that as it may, it remains to be explained why the regime reacted by imprisoning the first applicant for four days and withdrawing his Zimbabwean nationality, not when the letter proposing that President Mugabe should retire was received but only when the apology letter was delivered subsequently. Lastly, as observed by the institutions concerned, the way in which the latter letter was written indicates a pre-existing relationship with President Mugabe and expressly confirms not only the first applicant’s loyalty to the President but also his willingness and intention to play a constructive role in the future if the President so wished. 89 As a consequence, far from showing that, from a certain point in time, the first applicant became an opponent of the Zimbabwean regime or, at least, in fact severed his relationship with the regime, those circumstances are to be understood in a context characterised by a continuous relationship with that regime and by the first applicant’s intention to maintain that relationship in the future and dispel any doubt as to that intention. 90 That finding is confirmed by the fact that, according to a letter from Zimbabwean lawyers acting on behalf of the first applicant, the investigation launched in his regard did not result in any charges being brought and was abandoned. 91 There is therefore nothing to suggest that the events examined in paragraph 88 above, which, for the reasons given, appear to be but one episode in the first applicant’s long-term relationship with the Zimbabwean regime, led to a definitive breaking off of the relationship in question. As submitted by the institutions concerned, that type of information is especially important in view of the fact that the first applicant still has considerable landholdings in the vicinity of Harare, notwithstanding the confiscation campaign, which, according to the first applicant, was conducted by the Zimbabwean Government for many years against the members of the Commercial Farmers’ Union of Zimbabwe. 92 Accordingly, it is also clear that the fact, relied on by the applicants, that a number of officials of the United Kingdom Government have on various occasions expressed a certain scepticism as to the reliability of the evidence adduced against the applicants can have no bearing on the conclusions set out above as regards the adequacy of the evidence for the purpose of the inclusion and maintenance of the first three applicants and Breco International on the list of persons referred to in Article 6 of Regulation No 314/2004. 93 The same applies as regards the applicants’ argument that a number of items of information available to the public relied on by the Council were downloaded after the inclusion of the first three applicants and Breco International on the list of persons referred to in Article 6 of Regulation No 314/2004. As those items were dated prior to that inclusion, the fact that the relevant copies were printed in 2014 in order for them to be produced in the present proceedings is immaterial from a legal standpoint. 94 In the light of the evidence described in paragraphs 73 to 83 above and in view of the importance of what was at stake (see paragraph 72 above), it must be concluded that the Council and the Commission did not err in including the first applicant on the list of persons referred to in Article 6 of Regulation No 314/2004 on the ground that he was a ‘businessman with strong ties to the Government of Zimbabwe’ and that he ‘[had] provided, including through his companies, financial and other support to the regime (see also items [1 to 9], 12, 14, 20, 24, 25, 28, 29, 31 and 32 in part II)’. Furthermore, for the reasons set out in paragraph 37 above, the inclusion of the second and third applicants and Breco International on that list is similarly not unlawful. The alleged breach of the applicants’ right to property 95 The applicants submit that, given the allegedly unlawful acts relied on in the complaints examined above, their right to property was undermined to a disproportionate degree, thus giving rise to non-contractual liability on the part of the European Union. 96 It is sufficient to note in that regard, as is clear from the foregoing analysis, that the inclusion of the first three applicants on the list of persons referred to in Article 6 of Regulation No 314/2004 is not unlawful. As a consequence, in view of the fact that, as explained in paragraph 26 above, a system of restrictive measures such as the system in question constitutes a limitation that satisfies the criteria laid down in Article 52(1) of the Charter, no breach of the applicants’ right to property has been established. 97 Accordingly, the fourth applicant, which, as stated in paragraph 20 above, was not included on the lists in question, cannot claim to have suffered loss as a result of the unlawfulness of the decision to include the first three applicants and Breco International on those lists. 98 In view of the cumulative nature of the conditions for incurring the non-contractual liability of the European Union (see paragraph 17 above), the action must be dismissed, without there being any need to rule on the admissibility of the document referring to the various forms of loss allegedly suffered by the applicants, which was submitted after the closure of the written procedure. Costs 99 Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. 100 Since the applicants have been unsuccessful, they must be ordered to pay the costs, as applied for by the Council and the Commission. On those grounds, THE GENERAL COURT (Eighth Chamber) hereby: 1. Dismisses the action; 2. Orders John Arnold Bredenkamp, Echo Delta (Holdings) PCC Ltd, Scottlee Holdings (Private) Ltd and Fodya (Private) Ltd to pay the costs of the Council of the European Union and the European Commission. Gratsias Kancheva Wetter Delivered in open court in Luxembourg on 21 July 2016. [Signatures] * Language of the case: English. 1 This judgment is published in extract form.