Information;Judgment — ECLI:EU:C:2020:992
Date: 2020-12-03
Language of the case: English
Court formation: Seventh Chamber
Subject matter: External relations;Common foreign and security policy
Procedure: Action for annulment;Appeal - successful

summary of reasons underpinning that decision, with the consequence that judicial review cannot be restricted to an assessment of the cogency in the abstract of the reasons relied on, but must concern whether those reasons, or, at the very least, one of those reasons, deemed sufficient in itself to support that decision, are substantiated (judgments of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 119; of 18 June 2015, Ipatau v Council, C‑535/14 P, EU:C:2015:407, paragraph 42; of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 22; and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 23). 34 In the present case, as the General Court noted in paragraphs 24, 143 and 337 of the judgment under appeal in Case C‑72/19 P, the restrictive measures against the appellants were maintained by the acts at issue in Case C‑72/19 P on the basis of the listing criterion set out in Article 1(1) of Decision 2011/172. That criterion provides for the freezing of the funds and economic resources belonging to, owned, held or controlled by persons having been identified as responsible for misappropriation of Egyptian State funds, and natural or legal persons, entities or bodies associated with them. 35 In that regard, it is clear from paragraphs 163, 166, 242, 244, 256, 339, 392 and 410 of the judgment under appeal in Case C‑72/19 P that, in order to maintain the restrictive measures to which the appellants were subject, the Council took as its basis the existence of judicial proceedings against them in Egypt for misappropriation of State funds. More specifically, the Council relied on a set of documents sent to it by the Egyptian authorities, which it then sent to those appellants, that is to say, asset freezing orders (referred to in the letters from the Council sent to them on 12 and 25 February 2016, 21 March 2016, 27 January 2017, 6 and 22 February 2017 and 22 March 2017), letters from the Egyptian Prosecutor General’s Office of 2 January, 22 February and 5 December 2016 and 6 February 2017, and a memorandum from the National Committee for the recovery of assets abroad. 36 It follows that the maintenance, by the acts at issue in Case C‑72/19 P, of the restrictive measures taken against the appellants is based on the decision of an authority of a third State, which was competent to make it, to initiate and conduct criminal investigation procedures concerning an offence of misappropriation of public funds. 37 It is for the Council, before acting on the basis of a decision of an authority of a third State with a view to adopting or maintaining restrictive measures, to verify whether that decision was adopted in accordance with the rights of the defence and the right to effective judicial protection (judgments of 26 July 2017, Council v LTTE, C‑599/14 P, EU:C:2017:583, paragraph 24; of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 26; and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 27). 38 In accordance with settled case-law, the Council is obliged, when adopting restrictive measures, to act in accordance with the fundamental rights that form an integral part of the EU legal order, which include, as has been pointed out in paragraph 32 of the present judgment, observance of the rights of the defence and the right to effective judicial protection (see, to that effect, judgments of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraphs 97 and 98; of 26 July 2017, Council v LTTE, C‑599/18 P, EU:C:2017:583, paragraph 25; of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 27; and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 28). 39 In that regard, the requirement for the Council to verify that the decisions of third States on which it bases the entry of a person or entity on a list of persons or entities whose assets are to be frozen have been taken in accordance with those rights is designed to ensure that they are included on that list only on a sufficiently solid factual basis and, thus, to protect the persons or entities concerned (see, to that effect, judgment of 26 July 2017, Council v LTTE, C‑599/18 P, EU:C:2017:583, paragraph 26; judgments of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 28, and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 29). 40 The Council cannot conclude that a listing decision is taken on a sufficiently solid factual basis before having itself verified that the rights of the defence and the right to effective judicial protection were observed at the time of the adoption of the decision by the third State in question on which it intends to base the adoption of restrictive measures (judgments of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 34, and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 35). 41 Lastly, and while the decision to maintain, by the acts at issue in Case C‑72/19 P, the freezing of the appellants’ assets affects them individually, it must be added that, in accordance with the case-law cited in paragraph 33 of the present judgment, the EU Court must be satisfied, in the context of its review of the lawfulness of the grounds on which such a decision is based, that, at the very least, one of those grounds is sufficiently detailed and specific, that it is substantiated and that it constitutes in itself sufficient basis to support that decision (see, to that effect, judgment of 28 November 2013, Council v Manufacturing Support & Procurement Kala Naft, C‑348/12 P, EU:C:2013:776, paragraph 72; judgments of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 38, and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 39). 42 Thus, although it is true that the listing criterion referred to in paragraph 34 of the present judgment allows the Council to base restrictive measures on a decision of a third State, such as those referred to in the letters and memorandum of the Egyptian authorities referred to in paragraph 35 of this judgment, the fact remains that the obligation, on that institution, to observe the rights of the defence and the right to effective judicial protection means that it must satisfy itself that those rights were observed by the authorities of the third State which adopted that decision (see, to that effect, judgments of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 35, and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 36). 43 Consequently, as is clear from the case-law cited in the preceding paragraph, it was for the General Court to review whether the Council had itself verified that the rights of the defence and the right to effective judicial protection had been observed by the Egyptian authorities when those authorities adopted the decisions which that institution took as its basis in order to maintain the restrictive measures. 44 In the present case, the mere reference by the Council to letters and a memorandum from the Egyptian authorities, in which those authorities set out the manner in which the applicants’ fundamental rights had been observed and gave assurances in that regard, while it did not dispute that it did not itself verify whether those rights had been observed and even stated that further checks on its part were not necessary in that respect, cannot suffice for the view to be taken that the decision by the Council to maintain the appellants on the lists at issue rests on a sufficiently solid factual basis, within the meaning of the case-law cited in paragraphs 33, 39 and 40 of this judgment. 45 That conclusion cannot be called into question by the Council’s argument that the appellants have not put forward any evidence capable of demonstrating that their particular situation had been affected by the alleged problems of the Egyptian judicial system. Indeed, in accordance with the settled case-law, it is the task of the competent EU authority to establish, in the event of challenge, that the reasons relied on against the person concerned are well founded, and not the task of that person to adduce evidence of the negative, that those reasons are not well founded (judgments of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 121; of 28 November 2013, Council v Fulmen and Mahmoudian, C-280/12 P, EU:C:2013:775, paragraph 66); of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 39; and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 40). 46 Moreover, the Court has stated that, in the light of the settled case-law cited in paragraphs 38, 39 and 45 above, it cannot be inferred from the judgments of 19 October 2017, Yanukovych v Council (C‑598/16 P, not published, EU:C:2017:786), and of 19 October 2017, Yanukovych v Council (C‑599/16 P, not published, EU:C:2017:785), to which the Council referred, that the Council is not required to verify that the decision of a third State on which it intends to base the adoption or maintenance of restrictive measures has been taken in accordance with the rights of the defence and the right to effective judicial protection (see, to that effect, judgments of 19 December 2018, Azarov v Council, C‑530/17 P, EU:C:2018:1031, paragraph 40, and of 11 July 2019, Azarov v Council, C‑416/18 P, not published, EU:C:2019:602, paragraph 41). 47 It follows from the foregoing that the General Court erred in law in finding, in paragraphs 126, 128, 131, 315, 316, 319, 328, 329 and 366 of the judgment under appeal in Case C‑72/19 P, that the Council was not required, before relying on the decisions of the Egyptian authorities in order to maintain the restrictive measures to which the appellants were subject, to verify that those decisions had been adopted in accordance with the rights of the defence and the right to effective judicial protection, since the appellants had not produced objective, reliable, specific and consistent evidence such as to raise legitimate questions concerning the observance of those rights. 48 It follows that the first part of the first ground of appeal must be upheld. 49 In the light of the foregoing considerations, the judgment under appeal in Case C‑72/19 P must be set aside in so far as, by that judgment, the General Court rejected the forms of order sought in Cases T‑274/16 and T‑275/16 seeking the annulment of the acts at issue in Case C‑72/19 P, without it being necessary to rule on the other parts of that first ground of appeal or on the other grounds of appeal. The appeal in Case C‑145/19 P 50 The appellant raises four grounds in support of his appeal. By his first ground of appeal, which is divided into three parts, he alleges that the General Court made an error of assessment in finding that the Council was not required to satisfy itself that the Egyptian authorities had acted in accordance with Mr Hosni Mubarak’s fundamental rights. By his second ground of appeal, he alleges that the General Court erred in finding that the Council was not required to verify that the judicial proceedings and investigations involving Mr Hosni Mubarak concerned facts that are such as to undermine the rule of law in Egypt. By his third and fourth grounds of appeal, he alleges that the General Court wrongly held that the Council had not committed a manifest error of assessment in relying on Cases No 8897 (renovation of a private home), No 756 (allegations relating to the gifts from the Al-Ahram newspaper) and No 53 (allegations relating to gifts from the newspaper Dar El Tahrir). 51 It is appropriate to examine the first part of the first ground of appeal. Arguments of the parties 52 By the first part of the first ground of appeal, the appellant complains that the General Court committed a manifest error of law with regard to the burden of proof in finding, in paragraphs 68, 69, 77, 81, 85, 95 and 97 of the judgment under appeal in Case C‑145/19 P, that, since Mr Hosni Mubarak did not put forward objective, reliable, specific and consistent evidence such as to raise legitimate questions concerning the observance of his fundamental rights by the Egyptian authorities, the Council was not required to carry out that additional verification. 53 In response, the Council advances arguments similar to those which it put forward in the appeal in Case C‑72/19 P, as set out in paragraph 31 of the present judgment, and submits that the first part of the first ground of appeal must be rejected as unfounded. Findings of the Court 54 In support of the first part of the first ground of appeal, the appellant repeats, in similar terms, the arguments put forward by the appellants in Case C‑72/19 P in the context of the first part of the first ground of appeal in that case. 55 In the present case, as the General Court noted in paragraphs 22, 36 and 101 of the judgment under appeal in Case C‑145/19 P, the restrictive measures taken against Mr Hosni Mubarak were maintained by the acts at issue in Case C‑145/19 P on the basis of the listing criterion set out in Article 1(1) of Decision 2011/172. That criterion provides, inter alia, for the freezing of funds and economic resources belonging to persons who have been identified as responsible for misappropriation of Egyptian State funds. 56 In that regard, it is apparent from paragraphs 15, 17, 56, 147, 156 and 160 of the judgment under appeal in Case C‑145/19 P that, in order to adopt those restrictive measures, the Council took as its basis the existence of judicial proceedings in Egypt against Mr Hosni Mubarak for misappropriation of State funds. More specifically, the Council relied on a set of documents sent to it by the Egyptian authorities, which it then sent to the person concerned, namely asset freezing orders (referred to in the letters from the Council sent to him on 9 February 2017, 22 March 2017 and 21 March 2018), and on the memoranda of the Egyptian authorities of 12 March 2015, 5 December 2016, 29 August 2017 and 20 February 2018. 57 It follows that the maintenance, by the acts at issue in Case C‑145/19 P, of the restrictive measures taken against Mr Hosni Mubarak is based on the decision of an authority of a third State, which was competent to make it, to initiate and conduct criminal investigation procedures concerning an offence of misappropriation of public funds. 58 While it is true that the listing criterion referred to in paragraph 55 of this judgment allows the Council to base restrictive measures on the decision of a third State, such as that referred to in the memoranda of the Egyptian authorities sent to the Council, referred to in paragraph 56 of this judgment, it follows from the case-law cited in paragraph 42 above that it was for the General Court to verify that the Council had itself ascertained that Mr Hosni Mubarak’s rights of the defence and right to effective judicial protection had been observed by the Egyptian authorities when adopting the decisions which the Council took as its basis to maintain the restrictive measures. 59 In the present case, the mere reference by the Council to memoranda from the Egyptian authorities in which they explained the manner in which Mr Hosni Mubarak’s fundamental rights had been observed and gave assurances in that regard, while the Council did not dispute that it did not itself verify observance of those rights and even stated that further checks on its part were not necessary in that respect, cannot suffice for the view to be taken that the Council’s decision to maintain Mr Hosni Mubarak on the lists at issue rests on a sufficiently solid factual basis, within the meaning of the case-law cited in paragraphs 33, 39 and 40 of the present judgment. 60 It follows from the foregoing that, in the light of the case-law set out in paragraphs 32, 33, 37 to 42, 45 and 46 of the present judgment, the General Court erred in law in finding, in paragraphs 68, 69, 77, 81, 85, 95 and 97 of the judgment under appeal in Case C‑145/19 P, that the Council was not required, before relying on the decisions of the Egyptian authorities to maintain the restrictive measures to which Mr Hosni Mubarak was subject, to verify that those decisions had been adopted in observance of the rights of the defence and the right to effective judicial protection, since Mr Hosni Mubarak had not put forward objective, reliable, specific and consistent evidence such as to raise legitimate questions concerning the observance of those rights. 61 It follows that the first part of the first ground of appeal must be upheld. 62 Having regard to the foregoing considerations, it is appropriate to set aside the judgment under appeal in Case C‑145/19 P, without it being necessary to rule on the other parts of the first ground of appeal or on the other grounds of appeal. The action before the General Court 63 In accordance with the first paragraph of Article 61 of the Statute of the Court of Justice of the European Union, if the Court of Justice quashes the decision of the General Court, it may itself give final judgment in the matter, where the state of the proceedings so permits. 64 In the present case, the Court has the necessary information to give final judgment in the actions for annulment in Joined Cases T‑274/16 and T‑275/16, in so far as, by those actions, the appellants in Case C‑72/19 P sought annulment of the acts at issue in Case C‑72/19 P and in the action for annulment in Case T‑358/17, by which Mr Hosni Mubarak sought annulment of the acts at issue in Case C‑145/19 P. 65 In that regard, as is apparent from paragraphs 44 and 59 of the present judgment, the Council did not fulfil its obligation to verify that the Egyptian authorities acted in accordance with the rights of the defence and the right to judicial protection of the appellants in Cases C‑72/19 P and C‑145/19 P before relying on the decisions of those authorities in order to adopt the restrictive measures against those appellants. 66 In those circumstances, on the grounds set out in paragraphs 34 to 43, 45 to 47, 55 to 58 and 60 of the present judgment, the second pleas in law in each of the actions in Joined Cases T‑274/16 and T‑275/16 and in Case T‑358/17 must be upheld, without it being necessary to examine the other pleas in those actions, and, consequently, the acts at issue in Case C‑72/19 P, in so far as they concern the appellants in that case, and the acts at issue in Case C‑145/19 P, in so far as they concern Mr Hosni Mubarak, must be annulled. Costs 67 Under Article 184(2) of the Rules of Procedure of the Court of Justice, where the appeal is well founded and the Court itself gives final judgment in the case, the Court is to make a decision as to costs. 68 Under Article 138(1) of those rules, which applies to appeal proceedings by virtue of Article 184(1) thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. 69 Since the appellants in Joined Cases C‑72/19 P and C‑145/19 P have applied for an order that the Council pay the costs and the Council has been unsuccessful, the Council must be ordered to bear its own costs and to pay those incurred by those appellants relating both to the proceedings before the General Court and to the present appeals. On those grounds, the Court (Seventh Chamber) hereby: 1. Sets aside the judgment of the General Court of the European Union of 22 November 2018, Saleh Thabet and Others v Council (T‑274/16 and T‑275/16, not published, EU:T:2018:826), in so far as, by that judgment, the General Court dismissed the actions seeking the annulment of Council Decision (CFSP) 2016/411 of 18 March 2016 amending Decision 2011/172/CFSP concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt and of Council Decision (CFSP) 2017/496 of 21 March 2017 amending Decision 2011/172/CFSP concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt; 2. Sets aside the judgment of the General Court of the European Union of 12 December 2018, Mubarak v Council (T‑358/17, not published, EU:T:2018:905); 3. Annuls Decisions 2016/411 and 2017/496, in so far as they concern Ms Suzanne Saleh Thabet, Mr Gamal Mohamed Hosni Elsayed Mubarak, Mr Alaa Mohamed Hosni Elsayed Mubarak, Ms Heddy Mohamed Magdy Hussein Rassekh and Ms Khadiga Mahmoud El Gammal; 4. Annuls Decision 2017/496, Council Implementing Regulation (EU) 2017/491 of 21 March 2017 implementing Regulation (EU) No 270/2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt, Council Decision (CFSP) 2018/466 of 21 March 2018 amending Decision 2011/172/CFSP concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt, and Council Implementing Regulation (EU) 2018/465 of 21 March 2018 implementing Regulation (EU) No 270/2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt, in so far as those acts concern Mr Mohamed Hosni Elsayed Mubarak; 5. Orders the Council of the European Union to pay the costs incurred both in the proceedings at first instance and in the present appeals. Kumin Arabadjiev von Danwitz Delivered in open court in Luxembourg on 3 December 2020. A. Calot Escobar A. Kumin Registrar President of the Seventh Chamber * Language of the case: English.