Judgment — ECLI:EU:T:2016:47
Date: 2016-01-28
Language of the case: English
Subject matter: External relations;Common foreign and security policy
Procedure: Action for annulment - successful;Action for annulment - inadmissible

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 by sufficiently specific and concrete evidence (see judgment of 21 April 2015 in Anbouba v Council, C‑605/13 P, ECR, EU:C:2015:248, paragraphs 41 and 45 and the case-law cited). 39 In the present case, the criterion laid down in Article 1(1) of Decision 2014/119 provides that restrictive measures are to be adopted against persons who have been identified as responsible for the misappropriation of public funds. Furthermore, it is clear from recital 2 of that decision that the Council adopted those measures ‘with a view to consolidating and supporting the rule of law ... in Ukraine’. 40 The name of the applicant was included on the list on the ground that he was a ‘person subject to investigation in Ukraine for involvement in crimes in connection with the embezzlement of Ukrainian State funds and their illegal transfer outside Ukraine’. It thus appears that the Council took the view that, at the very least, the applicant was the subject of a preliminary investigation or inquiry, which had not (or not yet) culminated in the bringing of a formal charge, by reason of his alleged involvement in the misappropriation of public funds. 41 In support of the reason for including the applicant’s name on the list, the Council relies on the letter of 3 March 2014 and on other evidence post-dating Decision 2014/119 and Regulation No 208/2014. 42 The first part of the letter of 3 March 2014 states that the ‘law-enforcement agencies of Ukraine’ have launched a number of criminal proceedings to investigate criminal acts committed by former senior officials, whose names are listed immediately afterwards, with regard to whom the investigation into the abovementioned offences has made it possible to establish the misappropriation of large amounts of public funds and their subsequent unlawful transfer out of Ukrainian territory. 43 The second part of the letter of 3 March 2014 adds that ‘the investigation verifies the involvement of other senior officials representing former authorities in the same sort of crimes’ and that it is ‘planned to notify them shortly of suspicion’. The names of those other senior officials, including that of the applicant, are also then listed. 44 With regard to the case file, the letter of 3 March 2014 is the only item of evidence submitted by the Council in the present proceedings which predates Decision 2014/119 and Regulation No 208/2014. The lawfulness of those acts must therefore be assessed in the light of that item of evidence alone. 45 It is therefore necessary to establish whether the letter of 3 March 2014 constitutes sufficient proof to support the conclusion that the applicant had been ‘identified as responsible for the misappropriation of Ukrainian State funds’ within the meaning of Article 1(1) of Decision 2014/119. 46 Although, as the Council submits, the letter of 3 March 2014 was sent by a high judicial body in a third country, that is to say, the Prosecutor General of Ukraine, it contains only a general and generic statement linking the applicant’s name, among those of other former senior officials, to an investigation which essentially sought to establish the involvement of those persons in acts of misappropriation of public funds. The letter does not provide any details as to the establishment of the acts under investigation by the Ukrainian authorities and, still less, as to the applicant’s individual liability, even if presumed, in respect of those acts. 47 It is true, as the Council submits, that, in the context of the application of restrictive measures, the EU Courts have held that identification of a person as responsible for an offence did not necessarily imply that that person had been convicted of that offence (see, to that effect, judgments of 5 March 2015 in Ezz and Others v Council, C‑220/14 P, ECR, EU:C:2015:147, paragraph 72, and 27 February 2014 Ezz and Others v Council, T‑256/11, ECR, EU:T:2014:93, paragraphs 57 to 61). 48 However, in the context of the cases which gave rise to the case-law cited in paragraph 47 above, the applicants had, at least, been the subject of an order of the Prosecutor General of the third country concerned seeking to seize their assets, which had been endorsed by a criminal court (judgment in Ezz and Others v Council, cited in paragraph 47 above, EU:T:2014:93, paragraph 132). Consequently, the imposition of restrictive measures on the applicants in those cases was based on specific facts of which the Council was aware. 49 In the present case, the Court finds, first, that the Council did not have any information regarding the acts or conduct specifically attributed to the applicant by the Ukrainian authorities and, secondly, that, even if it is examined in its context, the letter of 3 March 2014 on which it relies cannot constitute a sufficiently solid factual basis within the meaning of the case-law cited in paragraph 38 above for inclusion of the applicant’s name on the list on the ground that he had been ‘identified as responsible’ for the misappropriation of State funds. 50 Irrespective of the stage reached in the proceedings to which the applicant was deemed to be subject, the Council could not adopt restrictive measures against him without knowing the acts of misappropriation of public funds which the Ukrainian authorities specifically alleged against him. It is only by being aware of such acts that the Council would have been in a position to establish that they were capable, first, of being categorised as misappropriation of public funds and, secondly, of undermining the rule of law in Ukraine, the consolidation and support of which, as was recalled in paragraph 39 above, constitute the objective pursued by the adoption of the restrictive measures in question. 51 Furthermore, it is for the competent European Union 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 in Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, ECR, EU:C:2013:518, paragraphs 120 and 121, and 28 November 2013 Council v Fulmen and Mahmoudian, C‑280/12 P, ECR, EU:C:2013:775, paragraphs 65 and 66). 52 In view of all of the foregoing, the inclusion of the applicant’s name on the list does not comply with the criteria for the designation of persons covered by the restrictive measures at issue which were laid down in Decision 2014/119. 53 Since the second, sixth and seventh pleas in law are well founded, the action must be upheld in that it seeks annulment of Decision 2014/119 in so far as it concerns the applicant, without there being any need to rule on the applicant’s other pleas. 54 For the same reasons, Regulation No 208/2014 must be annulled in so far as it concerns the applicant. The claim for annulment of Decision 2015/876 and Implementing Regulation 2015/869 in so far as they relate to the applicant 55 In the statement modifying the form of order sought, the applicant also seeks annulment of Decision 2015/876 and Implementing Regulation 2015/869 in so far as they relate to him. 56 The Council, supported by the Commission, contends, first of all, that the statement modifying the form of order sought is inadmissible. First, it submits that the applicant could not modify the claim for annulment of Decision 2014/119 and Regulation No 208/2014, in so far as they relate to him, so that that claim also covers Decision 2015/876 and Implementing Regulation 2015/869, given that Decision 2014/119 and Regulation No 208/2014 had already been replaced by Decision 2015/364 and Implementing Regulation 2015/357. Consequently, according to the Council, Decision 2015/876 and Implementing Regulation 2015/869 merely amended Decision 2015/364 and Implementing Regulation 2015/357 and did not concern Decision 2014/119 and Regulation No 208/2014. 57 Secondly, the Council submits that the statement modifying the form of order sought does not contain a statement of reasons, which it ought to have contained in accordance with Article 86(3) of the Rules of Procedure, bearing in mind the new factual and legal situation on the date on which the new measures were adopted, that is to say, that relating to the entry into force of Decision 2015/876 and Implementing Regulation 2015/869. 58 The Council also submits that, in any event, the statement modifying the form of order sought is unfounded. 59 It must be recalled that, in accordance with settled case-law, where the measure initially contested is replaced, during the proceedings, by another measure with the same subject matter, the latter is to be considered a new factor allowing the applicant to modify its claims and pleas in law (see, to that effect, judgment of 5 November 2014 in Mayaleh v Council, T‑307/12 and T‑408/13, ECR, EU:T:2014:926, paragraph 47). 60 It must also be recalled that, by virtue of Article 86(3) of the Rules of Procedure, the statement modifying the form of order sought, where appropriate, must contain, inter alia, the modified pleas in law and arguments. 61 That, however, is not the case here. It must be recalled that the annex to Decision 2014/119 and Annex I to Regulation No 208/2014 were ‘replaced’ respectively by Decision 2015/364 and Implementing Regulation 2015/357. As has been explained in paragraph 13 above, following that amendment, the applicant’s name was retained on the list with a new statement of reasons. Those measures were not challenged by the applicant in a separate action or statement modifying the form of order sought. 62 The annexes in question were subsequently ‘amended’ by Decision 2015/876 and Implementing Regulation 2015/869. As has been explained in paragraph 15 above, following that amendment, the applicant’s name was retained on the list with a new statement of reasons. Those measures are the subject of the statement modifying the form of order sought. 63 The reasons for the inclusion of the applicant’s name on the list were as follows. 64 First of all, the name of the applicant was included on the list in Decision 2014/119 and Regulation No 208/2014 on the ground that he was a ‘person subject to investigation in Ukraine for involvement in crimes in connection with the embezzlement of Ukrainian State funds and their illegal transfer outside Ukraine’. 65 Next, the name of the applicant was retained on the list in Decision 2015/364 and Implementing Regulation 2015/357 on the ground that he was a ‘person subject to investigation by the Ukrainian authorities for involvement in the misappropriation of public funds or assets and in the abuse of public office as a public office-holder in order to procure an unjustified advantage for himself or for a third party and thereby causing a loss to Ukrainian public funds or assets’ and a ‘person associated with a designated person (Andrii Petrovych Kliuiev) subject to criminal proceedings by the Ukrainian authorities for the misappropriation of public funds or assets’. 66 Finally, the name of the applicant was retained on the list in Decision 2015/876 and Implementing Regulation 2015/869 on the ground that he was a ‘person subject to investigation by the Ukrainian authorities for involvement in the misappropriation of public funds’ and a ‘person associated with a designated person (Andrii Petrovych Kliuiev) subject to criminal proceedings by the Ukrainian authorities for the misappropriation of public finds or assets’. 67 Thus, the reason for the inclusion of the applicant’s name on the list relating to Decision 2015/876 and Implementing Regulation 2015/869, which are covered by the statement modifying the form of order sought, differs substantially from the reason for the inclusion of his name on the list relating to Decision 2014/119 and Regulation No 208/2014, which are covered by the application. 68 While the reason for the inclusion of the applicant’s name on the list set out in Decision 2014/119 and Regulation No 208/2014 merely referred to an investigation in Ukraine concerning involvement in crimes in connection with the embezzlement of Ukrainian State funds and their illegal transfer outside Ukraine, the reason for the inclusion of the applicant’s name on the list set out in Decision 2015/876 and Implementing Regulation 2015/869 provides more explanations as to why the applicant is subject to restrictive measures, in particular with the addition of the reference to his association with a person designated by restrictive measures, that is to say, his brother, Andrii Klyuyev, who in turn was subject to criminal proceedings brought by the Ukrainian authorities for misappropriation of public funds or assets. 69 In that respect, it must be stated that, in the application, the applicant claims in essence that the inclusion of his name on the list is not reasoned or based on evidence, and that he did not receive specific information relating to the investigation concerning him. 70 Although the arguments referred to in paragraph 69 above are well founded with regard to the evidence for the inclusion of the applicant’s name on the list, as is clear from paragraphs 35 to 53 above, it must be concluded that the reason for the inclusion of the applicant’s name on the list set out in Decision 2015/876 and Implementing Regulation 2015/869 is based on other evidence provided by the Council in the present proceedings. Although that evidence, which postdates Decision 2014/119 and Regulation No 208/2014, is not relevant for the purpose of assessing the legality of that initial listing, it must, nevertheless, be taken into account for the purpose of assessing the legality of the retention of the applicant’s name on the list by subsequent measures. 71 It follows that, by merely declaring that his initial claims seeking annulment of Decision 2014/119 and Regulation No 208/2014, in so far as they relate to him, extended to Decision 2015/876 and Implementing Regulation 2015/869, in so far as they relate to him, without giving any other explanations, the applicant has not provided any information which challenges the merits of those measures and which enables the Court to assess their legality. 72 It must therefore be concluded that the statement modifying the form of order sought does not satisfy the conditions laid down in Article 86(3) of the Rules of Procedure. 73 Consequently, the claim for annulment of Decision 2015/876 and Implementing Regulation 2015/869, in so far as they relate to the applicant, must be rejected as being inadmissible. The temporal effects of the annulment in part of Decision 2014/119 74 The Council submits that, if the Court annuls Decision 2014/119 in so far as it concerns the applicant, it will be necessary for the effects of that decision as regards the applicant to be maintained pursuant to the second paragraph of Article 264 TFEU until the partial annulment of Regulation No 208/2014 takes effect, in order to ensure legal certainty and preserve the coherence and consistency of the legal order. 75 The applicant disputes that line of argument. 76 It must be recalled that Decision 2014/119 was amended by Decision 2015/364, which replaced the list as from 7 March 2015 and extended the application of the restrictive measures concerning the applicant until 6 June 2015. Following those amendments the applicant’s name was retained on the list with new reasons for his listing (see paragraphs 12 and 13 above). 77 Decision 2014/119 was subsequently amended by Decision 2015/876, which extended the application of the restrictive measures concerning the applicant until 6 October 2015 and amended the list as from 7 June 2015. Following those amendments, the applicant’s name was included on the list with new reasons for his listing (see paragraphs 14 and 15 above). 78 Therefore, as at today’s date, the applicant is subject to a new restrictive measure. It follows that the annulment of Decision 2014/119, in so far as it relates to the applicant, does not lead to removal of his name from the list. 79 Consequently, it is not necessary to maintain the effects of Decision 2014/119, in so far as it relates to the applicant. Costs 80 Under Article 134(2) of the Rules of Procedure, where there is more than one unsuccessful party the Court is to decide how the costs are to be shared. In the present case, since the Council has been unsuccessful in relation to the claim for annulment made in the application, it must be ordered to pay the costs relating to that claim, in accordance with the form of order sought by the applicant. In addition, since the applicant has been unsuccessful in relation to the claim for annulment made in the statement modifying the form of order sought, he must be ordered to pay the costs relating to that claim, in accordance with the form of order sought by the Council. 81 Moreover, under Article 138(1) of the Rules of Procedure, the institutions which have intervened in proceedings are to bear their own costs. The Commission must therefore bear its own costs. On those grounds, THE GENERAL COURT (Ninth Chamber) hereby: 1. Annuls Council Decision 2014/119/CFSP of 5 March 2014 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Ukraine and Council Regulation (EU) No 208/2014 of 5 March 2014 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Ukraine, in so far as Mr Sergiy Klyuyev’s name was included on the list of persons, entities and bodies covered by those restrictive measures; 2. Dismisses the action as to the remainder; 3. Orders the Council of the European Union to bear its own costs, and to pay those incurred by Mr Klyuyev, in relation to the claim for annulment made in the application; 4. Orders Mr Klyuyev to bear his own costs, and to pay those incurred by the Council, in relation to the claim for annulment made in the statement modifying the form of order sought; 5. Orders the European Commission to bear its own costs. Berardis Czúcz Popescu Delivered in open court in Luxembourg on 28 January 2016. [Signatures] * Language of the case: English.