Judgment — ECLI:EU:T:2015:894
Date: 2015-11-26
Language of the case: English
Court formation: Seventh Chamber
Subject matter: External relations;Common foreign and security policy
Procedure: Action for annulment - unfounded

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, is substantiated (judgment in Kadi II, paragraph 60 above, EU:C:2013:518, paragraph 119). 108 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. It is necessary that the information or evidence produced should support the reasons relied on against the person concerned. If that material is insufficient to allow a finding that a reason is well founded, the Courts of the European Union are to disregard that reason as a possible basis for the contested decision to list or maintain a listing (judgment in Kadi II, paragraph 60 above, EU:C:2013:518, paragraphs 121 to 123). 109 Next, it must be pointed out that, given the not insignificant danger that an entity identified as providing support to the Iranian Government may exert pressure on the entities it owns or controls in order to circumvent the effect of the fund-freezing measures applying to it, by encouraging them either to transfer their funds to it, directly or indirectly, or to carry out transactions which it cannot itself perform by reason of the freezing of its funds, Article 20(1)(c) of Decision 2010/413, as amended, and Article 23(2)(d) of Regulation No 267/2012 require a fund-freezing measure to be adopted against those entities owned or controlled by an entity identified as providing support to the Iranian Government, and the Council has no discretion in that regard (see, to that effect, the judgment of 13 March 2012 in Melli Bank v Council, C‑380/09 P, ECR, EU:C:2012:137, paragraphs 39 and 58) 110 Accordingly, when adopting a decision under Article 20(1)(c) of Decision 2010/413, as amended, and Article 23(2)(d) of Regulation No 267/2012, the Council must assess the circumstances of the case in order to determine which entities are entities that are owned or controlled. On the other hand, the nature of the activities of the entity concerned and any lack of a link between those activities and the provision of support to the Iranian Government are not relevant criteria in that context, since the reason for the adoption of a fund-freezing measure against the entity that is owned or controlled need not be that that entity is itself directly providing support to the Iranian Government (see, to that effect, judgment in Melli Bank v Council, cited in paragraph 109 above, EU:C:2012:137, paragraphs 40 to 42). 111 Lastly, it is also settled case-law that, where the capital of an entity is entirely owned by an entity providing support to the Iranian Government, the criterion for inclusion laid down in Article 20(1)(c) of Decision 2010/413, as amended, and in Article 23(2)(d) of Regulation No 267/2012 is satisfied (see, to that effect, judgment in Melli Bank v Council, paragraph 109 above, EU:C:2012:137, paragraph 79). 112 It follows that the adoption of restrictive measures against an entity wholly owned by an entity considered to be providing support to the Iranian Government is not a consequence of an assessment by the Council as to the risk that the wholly owned entity might be led to circumvent the effect of the measures adopted against the parent entity, but is the direct result of the implementation of the relevant provisions of Decision 2010/413 and Regulation No 267/2012 (see, to that effect, judgment of 20 February 2013 in Melli Bank v Council, T‑492/10, ECR, EU:T:2013:80, paragraph 57). 113 In the present case, first of all, it should be borne in mind that the basis of the third reason relied on against the applicant is that it is a front company controlled by NIOC, which was designated by the Council on the basis that it provided support to the Iranian Government. The applicant does not dispute the fact that it was set up and is wholly owned by NIOC or that NIOC is subject to restrictive measures on the ground that it provides financial resources to the Iranian Government. 114 In accordance with the principle derived from the case-law mentioned in paragraph 112 above, it must therefore be concluded that the entry of the applicant’s name on the lists at issue was justified in the light of the criterion laid down in Article 20(1)(c) of Decision 2010/413, as amended, and Article 23(2)(d) of Regulation No 267/2012. On the basis of that criterion, the Council was not in fact required to demonstrate that the applicant itself directly provided financial support to the Iranian Government. 115 Accordingly, the third reason relied on has been proven to the requisite legal standard and justifies in itself the inclusion of the applicant’s name on the lists at issue. 116 Next, as regards the error in the formulation of the applicant’s name, it should be recalled that that error did not prevent the applicant from understanding the allegations levelled against it (see paragraphs 70 to 74 above) and the Court finds that that error does not alter the fact that the reason relied on, namely that NIOC owns and controls the applicant, is well founded. Thus, while undoubtedly regrettable, that error on the part of the Council cannot justify the annulment of the contested measures or therefore oblige the Council to adopt new measures. 117 Lastly, as regards the justification for the decision to maintain the applicant’s name on the lists at issue, since the applicant does not dispute that it is owned or controlled by NIOC in Case T‑372/14 either, it must be concluded that the entry of its name on the lists at issue remained justified when that decision was adopted. 118 In view of the foregoing, the pleas alleging error of assessment must be rejected as unfounded. 119 It follows from all the foregoing considerations that the actions in Joined Cases T‑159/13 and T‑372/14 must be dismissed in their entirety. Costs 120 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the applicant has been unsuccessful, it must be ordered to pay the costs, in accordance with the form of order sought by the Council. On those grounds, THE GENERAL COURT (Seventh Chamber) hereby: 1. Dismisses the actions. 2. Orders HK Intertrade Co. Ltd to bear its own costs and to pay the costs incurred by the Council of the European Union. Van der Woude Wiszniewska-Białecka Ulloa Rubio Delivered in open court in Luxembourg on 26 November 2015. [Signatures] * Language of the case: English.