62023TJ0480_RES
Case T‑480/23
Vladimir Gheorghe Plahotniuc
v
Council of the European Union
Judgment of the General Court (Fifth Chamber) of 23 October 2024
(Common foreign and security policy – Restrictive measures taken in view of actions destabilising Moldova – Freezing of funds – Restrictions on entry into the territories of the Member States – Lists of persons, entities and bodies subject to the freezing of funds and to restrictions on entry into the territories of the Member States – Inclusion of the applicant’s name on the lists – Criminal investigations and prosecutions initiated by the authorities of a third State – Obligation to verify that that decision observes the rights of the defence and the right to effective judicial protection – Obligation to state reasons)
Acts of the institutions – Statement of reasons – Obligation – Scope – Restrictive measures taken in view of the situation in Moldova – Prohibition on entry and transit and freezing of funds of persons responsible for actions which undermine or threaten the sovereignty and independence of Moldova – Obligation to identify in the statement of reasons the specific and concrete elements justifying the said measure – Decision falling within a context known to the person concerned, enabling him or her to understand the scope of the measure taken against him or her – Whether summary statement of reasons sufficient
(Art. 296 TFEU; Council Decision (CFSP) 2023/891, as amended by Decision (CFSP) 2023/1047; Council Regulations 2023/888 and 2023/1045)
(see paragraphs 20-24)
Acts of the institutions – Statement of reasons – Obligation – Scope – Reference to the legal basis of a restrictive measure taken in the context of the common foreign and security policy – Omission not constituting a substantial defect – Limits – Express reference indispensable to the exercise of judicial review
(Council Decision (CFSP) 2023/891, as amended by Decision (CFSP) 2023/1047; Council Regulations 2023/888 and 2023/1045)
(see paragraphs 26, 27)
Common foreign and security policy – Restrictive measures taken in view of the situation in Moldova – Decision to freeze funds – Adopted or maintained on the basis of criminal investigations or criminal proceedings carried out by the authorities of a third State concerning the misappropriation of public funds – Whether permissible – Condition – National decision adopted in accordance with the rights of the defence and the right to effective judicial protection – Council’s verification obligation – Obligation to state reasons – Scope – Adopted or maintained on the basis of press articles and press releases issued by those authorities referring to such criminal investigations and criminal proceedings – Irrelevant
(Art. 296 TFEU; Council Decision (CFSP) 2023/891, as amended by Decision (CFSP) 2023/1047; Council Regulations 2023/888 and 2023/1045)
(see paragraphs 40-49)
Common foreign and security policy – Restrictive measures taken in view of the situation in Moldova – Decision to freeze funds – Adopted or maintained on the basis of a judicial procedure carried out by the authorities of a third State concerning the misappropriation of public funds – Conditions – National decision adopted in accordance with the rights of the defence and the right to effective judicial protection – Obligation on the competent EU authority to establish, in the event of challenge, that the reasons relied on against the persons or entities concerned are well founded – Council’s obligation to verify observance of the rights in question – Infringement
(Council Decision (CFSP) 2023/891, as amended by Decision (CFSP) 2023/1047; Council Regulations 2023/888 and 2023/1045)
(see paragraphs 50-52)
Résumé
By its judgment, the General Court upholds the action for annulment brought by Vladimir Gheorghe Plahotniuc against the acts by which, in 2023, (
1
) the Council of the European Union included him on the lists of persons and entities subject to restrictive measures in view of the situation in the Republic of Moldova. This case allows the Court to clarify the case-law developed in the judgment in Azarov v Council (
2
) concerning the Council’s obligation to verify, when adopting restrictive measures on the basis of a decision of a third State, that that decision was adopted in accordance with the rights of the defence and the right to effective judicial protection.
In the face of threats to the stability of the Republic of Moldova, restrictive measures were introduced for the first time in April 2023. (
3
) The applicant, a politician and businessman of Moldovan nationality, had his funds and economic resources frozen on the ground that ‘through his serious financial misconduct concerning public funds and the unauthorised export of capital, [he] is responsible for actions and implementing policies which undermine and threaten the democracy, the rule of law, stability or security in the Republic of Moldova through undermining the democratic political process in the Republic of Moldova and serious financial misconduct concerning public funds’.
Findings of the Court
As a preliminary point, the Court states that, by referring in the grounds for listing of the contested acts to ‘serious financial misconduct concerning public funds and the unauthorised export of capital in an unauthorised manner’, the Council relied on a criterion that was distinct from that referred to in Article 2(3)(a)(iii) of Regulation 2023/888 (
4
) and Article 1(1)(a)(iii) of Decision 2023/891. (
5
) Such ambiguous wording is liable to give rise to a reasonable doubt as to whether the Council also relied on the criterion of undermining the democratic political process in the Republic of Moldova, laid down in Article 2(3)(a)(i) of Regulation 2023/888, vis-à-vis the applicant. The Court takes the view in that respect that although such ambiguity is not capable of establishing that the statement of reasons for the contested acts, taken as a whole, is inadequate, it nevertheless means that the applicant’s inclusion on the lists at issue must be regarded as being based solely on the criterion of serious financial misconduct concerning public funds and the unauthorised export of capital.
The Court goes on to examine the plea alleging that the Council infringed the applicant’s rights under Article 6 TEU, read in conjunction with Articles 2 and 3 TEU, and Articles 47 and 48 of the Charter of Fundamental Rights of the European Union, only as regards his inclusion on the lists at issue on the basis of the criterion of serious financial misconduct concerning public funds and the unauthorised export of capital.
In the present case, the Court finds that the statement of reasons for the contested acts shows that the applicant’s inclusion on the lists at issue is based exclusively on decisions of the Moldovan authorities to conduct criminal investigations and criminal proceedings against him.
It is true that the Council did not rely directly on decisions of the Moldovan authorities, which were competent to make them, to initiate criminal investigations or criminal proceedings concerning offences of embezzlement of State funds; rather, it essentially relied on press articles and press releases issued by the prosecutorial or investigating authorities of the Republic of Moldova, on official announcements by State bodies of third countries or on reports, all of which refer to such criminal investigations and criminal proceedings.
However, according to the Court, that fact cannot, in the instant case, release the Council from its obligation, when it adopts or maintains restrictive measures on the basis of a decision of a third State, to verify that that decision was taken in accordance with, inter alia, the rights of the defence and the right to effective judicial protection in that State, and then to show, in the acts imposing restrictive measures, that it satisfied itself that the decision of that State on which those measures are based was adopted in accordance with those rights.
On the contrary, the case-law deriving from the judgment in Azarov v Council must be applied all the more strictly to the Council, since the only evidence on which it relies is indirect evidence of the investigation measures and prosecutions justifying the applicant’s inclusion on the lists at issue.
Thus, irrespective of the evidence on which the initial listing is based, the Council may rely, directly or indirectly, on decisions of the authorities of third States to initiate criminal investigations or criminal proceedings only if it complies with the verification obligation and the obligation to state reasons.
Any other conclusion would allow the Council to evade the strict obligations imposed by the case-law of the Court of Justice, in that rather than relying on documents emanating from the authorities of the States concerned with competence to initiate criminal investigations or criminal proceedings concerning offences of embezzlement of State funds, it could act solely on the basis of documents which merely refer to them.
In the present case, the Council failed to show that it had verified that the prosecutions referred to in the grounds had been conducted in accordance with the applicant’s rights of defence and right to effective judicial protection.
The Court therefore concludes that the Council failed to fulfil its obligation to state reasons and annuls the contested acts in so far as they concern the applicant.
(
1
)	Council Decision (CFSP) 2023/1047 of 30 May 2023 amending Decision (CFSP) 2023/891 concerning restrictive measures in view of actions destabilising the Republic of Moldova (OJ 2023 L 140 I, p. 9) and Council Implementing Regulation (EU) 2023/1045 of 30 May 2023 implementing Regulation (EU) 2023/888 concerning restrictive measures in view of actions destabilising the Republic of Moldova (OJ 2023 L 140 I, p. 1).
(
2
)	Judgment of 19 December 2018, Azarov v Council (C‑530/17 P, EU:C:2018:1031).
(
3
)	See Article 1(1) of Decision 2023/891 and Article 2(3) of Regulation 2023/888.
(
4
)	Council Regulation (EU) 2023/888 of 28 April 2023 concerning restrictive measures in view of actions destabilising the Republic of Moldova (OJ 2023 L 114, p. 1).
(
5
)	Council Decision (CFSP) 2023/891 of 28 April 2023 concerning restrictive measures in view of actions destabilising the Republic of Moldova (OJ 2023 L 114, p. 15).