62023TJ0297_RES
Case T‑297/23
Gennady Nikolayevich Timchenko
v
Council of the European Union
Judgment of the General Court (First Chamber, Extended Composition) of 2 April 2025
(Common foreign and security policy – Restrictive measures adopted in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine – Freezing of funds – List of persons, entities and bodies subject to the freezing of funds and economic resources – Restrictions on entry into the territories of the Member States – List of persons, entities and bodies subject to restrictions on entry into the territories of the Member States – Maintenance of the applicant’s name on the lists – Obligation to state reasons – Definition of ‘leading businesspersons operating in Russia’ – Article 2(1)(g) of Decision 2014/145/CFSP – Article 3(1)(g) of Regulation (EU) No 269/2014 – Plea of illegality – Error of assessment – Right to be heard – Citizenship of the Union – Freedom of movement – Right to property – Proportionality)
Acts of the institutions – Statement of reasons – Obligation – Scope – Restrictive measures taken in view of the situation in Ukraine – Freezing of funds of certain persons and entities having regard to the situation in Ukraine – 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 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767, Annex; Council Regulations Nos 269/2014, Annex I, 2023/571 and 2023/1765)
(see paragraphs 39-42, 50)
EU law – Principles – Rights of the defence – Right to effective judicial protection – Restrictive measures – Obligation to disclose individual and specific grounds for the decisions adopted – Right to be heard prior to the adoption of such measures – Restrictions – Conditions
(Charter of Fundamental Rights of the European Union, Arts 41(2)(a) and 52(1))
(see paragraphs 56-58)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Freezing of funds – Rights of the defence – Subsequent decision maintaining the name of the applicant on the list of persons covered by those measures – No new grounds – Obligation for the Council to disclose to the person concerned new evidence taken into account during its periodic review of the restrictive measures – Communication of the new evidence to the person concerned so that he or she can submit his or her observations – Duty to act within a reasonable time
(Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767, Annex; Council Regulations Nos 269/2014, Annex I, 2023/571 and 2023/1765)
(see paragraphs 59-63)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Leading businesspersons operating in Russia and their close family members or other natural persons benefiting from them – Concept of ‘leading businessperson’ – No need to establish the existence of interdependence with the Government of the Russian Federation
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2023/1094, Art. 2(1)(g); Council Regulations Nos 269/2014, Art. 3(1)(g), and 2023/1089)
(see paragraphs 79-83, 86, 87)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Leading businesspersons operating in Russia and their close family members or other natural persons benefitting from them – Observance of the principle of legality and of the principle of legal certainty requiring clarity, precision and foreseeability of the effects of legal rules
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2023/1094, Art. 2(1)(g); Council Regulations Nos 269/2014, Art. 3(1)(g), and 2023/1089)
(see paragraphs 90-94)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Leading businesspersons operating in Russia and their close family members or other natural persons benefiting from them – Observance of the principle of proportionality
(Art. 21 TEU; Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2023/1094, Art. 2(1)(g); Council Regulations Nos 269/2014, Art. 3(1)(g), and 2023/1089)
(see paragraphs 99-106)
European Union – Judicial review of the legality of the acts of the institutions – Restrictive measures taken in view of the situation in Ukraine – Scope of the review – Proof that the measure is well founded – 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 – Inclusion on the lists based on a body of specific, precise and consistent evidence
(Charter of Fundamental Rights of the European Union, Art. 47; Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767; Council Regulations Nos 269/2014, 2023/571 and 2023/1765)
(see paragraphs 111-113)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Persons responsible for, supporting or implementing actions or policies undermining or threatening the territorial integrity, sovereignty or independence of Ukraine, and persons, entities or bodies associated with them – Persons, entities or bodies supporting, materially or financially, or benefitting from the Government of the Russian Federation, and persons associated with them – Council’s obligation to carry out an updated assessment in the course of the review of the restrictive measures – Evidence to the contrary – No change in the specific situation of the entity covered by the restrictive measures – No error of assessment
(Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767, Art. 2(1)(a) and (d), and Annex; Council Regulations Nos 269/2014, Art. 3(1)(a) and (d), and Annex I, 2023/571 and 2023/1765)
(see paragraphs 114-116, 159-164)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Persons responsible for, supporting or implementing actions or policies undermining or threatening the territorial integrity, sovereignty or independence of Ukraine, and persons, entities or bodies associated with them – Persons, entities or bodies supporting, materially or financially, or benefitting from the Government of the Russian Federation, and persons associated with them – Inclusion on the lists based on a body of specific, precise and consistent evidence – No error of assessment
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2023/572, Art. 2(1)(a) and (d), and Annex; Council Regulations Nos 269/2014, Art. 3(1)(a) and (d), and Annex I, and 2023/571)
(see paragraphs 129-136, 138, 143-147, 214)
European Union – Judicial review of the legality of the acts of the institutions – Restrictive measures taken in view of the situation in Ukraine – Scope of the review – Inclusion of the applicant on the list annexed to the contested decision on the basis of his or her status as a leading businessperson operating in Russia – Inclusion of the applicant on the list annexed to the contested decision by virtue of his or her support for actions and policies compromising the territorial integrity of Ukraine and his or her material and financial support for Russian decision-makers – Documents available to the public – Probative value – Principle of the unfettered assessment of the evidence
(Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767, Annex; Council Regulations Nos 269/2014, Annex I, 2023/571 and 2023/1765)
(see paragraphs 151-158)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Criteria for adopting restrictive measures – Leading businesspersons operating in Russia and their close family members or other natural persons benefiting from them – Inclusion on the lists based on a body of specific, precise and consistent evidence – No error of assessment
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2023/1767, Art. 2(1)(g), and Annex; Council Regulations Nos 269/2014, Art. 3(1)(g), and Annex I, and 2023/1765)
(see paragraphs 165-170)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Prohibition on entry and transit and freezing of funds of certain persons and entities in view of the situation in Ukraine – Restriction of the right to respect for private life, the right to property, and the right to free movement within the European Union – Whether permissible – Conditions – Restriction laid down by law – Respect for the essence of the right invoked – Pursuit of an objective of general interest recognised as such by the European Union – Observance of the principle of proportionality – Conditions met
(Arts 21(2) and 29 TEU; Arts 20(2) and 21(1) TFEU; Charter of Fundamental Rights of the European Union, Arts 7, 17, 45(1) and 52(1); Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2023/572 and (CFSP) 2023/1767, Arts 2(3) and (4), and Annex; Council Regulations Nos 269/2014, Arts 4(1), 5(1) and 6(1), and Annex I, 2023/571 and 2023/1765)
(see paragraphs 179-193, 203-210, 213-215)
Non-contractual liability – Conditions – Unlawfulness – Damage – Causal link – One of those conditions not met – Action for damages dismissed in its entirety
(Art. 340, second para., TFEU)
(see paragraphs 219, 220)
Résumé
In these judgments, the General Court dismisses the actions for annulment brought by Mr and Mrs Timchenko against the acts by way of which their names were maintained, in March 2023, (
1
) then in September of the same year, (
2
) by the Council of the European Union on the lists of persons and entities subject to restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine. These two cases afford the Court the opportunity, inter alia, to rule on the lawfulness of criterion (g), as amended, of Decision 2014/145, which allows the Council to take restrictive measures against leading businesspersons operating in Russia (
3
) and on the concept of association with regard to two members of a not-for-profit foundation.
These judgments arise in the context of a series of restrictive measures adopted by the European Union following the military aggression launched by the Russian Federation against Ukraine on 24 February 2022. The name of G.N. Timchenko, a businessperson of Russian and Finnish nationalities, was maintained on the lists at issue as a leading businessperson operating in Russia, on the grounds that he is responsible for supporting actions or policies which undermine the territorial integrity, sovereignty and independence of Ukraine, (
4
) for providing financial or material support for, and benefitting from Russian decision-makers responsible for the annexation of Crimea and the destabilisation of Ukraine. (
5
) The name of his spouse, E.P. Timchenko, was also maintained on those lists on the grounds that she is associated with her husband and benefits from Russian decision-makers responsible for the annexation of Crimea and the destabilisation of Ukraine.
In support of his action for annulment, G.N. Timchenko relies, in particular, on an error of assessment on the part of the Council as to the application, to him, of the criteria of association and of ‘leading businesspersons’; moreover, he raises a plea of illegality of the latter criterion as amended in 2023. His spouse, E.P. Timchenko, relies, for her part, on a manifest error of assessment as to the application, to her, of the criterion of association.
Findings of the Court
As regards, in the first place, the plea of illegality raised by G.N. Timchenko with regard to the first part of criterion (g), as amended, of Decision 2014/145, according to which the Council established a presumption of interdependence between leading businesspersons and the Russian Government, the Court observes, first, that the amendment to criterion (g) does not concern the definition of the concept of ‘leading businesspersons’ per se. The sole purpose of that amendment was to widen the scope of restrictive measures so that they may apply to all leading businesspersons, including those who are not involved in an economic sector providing a substantial source of revenue to the Russian Government. The Court finds, next, that the widening of that criterion is intended to exploit the influence that leading businesspersons are likely to exert on the Government of the Russian Federation, so that it might alter its policy with regard to Ukraine.
Finally, the Court recalls, first, that the adoption of a criterion for inclusion on the lists at issue is an act of general application intended to attain an objective covered by the common foreign and security policy and, second, that the Council has broad discretion in so far as concerns the adoption of such criteria. In such circumstances, the Council is not required to adduce evidence to establish the existence of interdependence between the Russian Government and leading businesspersons for the purpose of adopting the first part of criterion (g), as amended. The mere fact of belonging to the category of leading businesspersons operating in Russia is sufficient to justify the adoption of the necessary restrictive measures on the basis of the first part of criterion (g), as amended. Accordingly, by adopting an objective, autonomous and sufficient criterion which serves to justify the inclusion of persons on the lists at issue, which necessitates, inter alia, proof that two cumulative requirements have been met, the Council has not established any presumption.
In so far as concerns, in the second place, the alleged breach of the principle of legal certainty by the first part of criterion (g), as amended, the Court finds, first, that the condition relating to business operations in Russia is sufficiently circumscribed and defined as not to infringe the principle of legal certainty. The provisions of the first part of criterion (g), as amended, are moreover sufficiently clear, precise and foreseeable as to determine the persons to whom those provisions are intended to apply. Next, they form part of a legal framework that is clearly delimited by the objectives pursued by the legislation governing the restrictive measures at issue. Finally, it cannot be argued that that criterion does not comply with the principle of legality inasmuch as the first part of criterion (g), as amended, was introduced by an act of general application adopted under Article 29 TEU.
In the light, in the third place, of the alleged breach of the principle of proportionality, the Court observes that the Council’s approach, which consists in widening the circle of persons subject to the restrictive measures at issue, having regard to the worsening of the situation in Ukraine, in order to achieve the objectives pursued, is based on the progressive impairment of rights according to the effectiveness of the measures. By adopting criterion (g), as amended, the Council aims to exploit the influence that that category of persons likely to exert on the Russian regime by pushing them to put pressure on that government so that it might alter its policy with regard to Ukraine. The adoption of the first part of criterion (g), as amended, was therefore appropriate in order to achieve the objectives pursued by the restrictive measures, and necessary in order to implement the objectives referred to in Article 21 TEU.
In so far as concerns, in the fourth and last place, the plea alleging error of assessment under criterion (a) of Decision 2014/145, the Court finds that the items of evidence adduced by the Council show that Bank Rossiya, in which the applicant is a shareholder through the companies Volga Group and Transoil, made investments in various areas in Crimea, which contribute to the implementation of the policy of annexation of that region of Ukraine by the Russian Federation. In that connection, the Court observes that even with 10.323% of the shares in Bank Rossiya, the applicant is that bank’s second biggest shareholder. Furthermore, as the items of evidence adduced by the Council show, Bank Rossiya is known for being a banking institution that is very close to the entourage of Mr Putin. In the light of the foregoing, the Court finds that G.N. Timchenko can be regarded as supporting actions or policies which undermine or threaten the territorial integrity, sovereignty and independence of Ukraine within the meaning of criterion (a).
Lastly, in so far as concerns the spouse of G.N. Timchenko, the Court finds, in the light of the items of evidence adduced by the Council, that, as a founder and member of the board of trustees of the Timchenko Foundation, E.P. Timchenko is fully involved in the administration thereof. It notes, moreover, that G.N. Timchenko involved Volga Group undertakings in the activities of the foundation, by providing the latter with financial and logistical support, along with support in maintaining relationships, during the health crisis linked to the COVID-19 pandemic. On an operational level, that businessperson thus created synergies between the undertakings in his group and the foundation in order to supplement the actions of Russia’s public services. In the light of the institutional roles played by Mr and Mrs Timchenko in the foundation and their investment in the operation thereof, the Court finds that there exists an association between the two spouses, within the meaning of the relevant provisions of Decision 2014/145.
(
1
)	Council Decision (CFSP) 2023/572 of 13 March 2023 amending Decision 2014/145/CFSP concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (OJ 2023 L 75 I, p. 134), and Council Implementing Regulation (EU) 2023/571 of 13 March 2023 implementing Regulation (EU) No 269/2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (OJ 2023 L 75 I, p. 1).
(
2
)	Council Decision (CFSP) 2023/1767 of 13 September 2023 amending Decision 2014/145/CFSP concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (OJ 2023 L 226, p. 104), and Council Implementing Regulation (EU) 2023/1765 of 13 September 2023 implementing Regulation (EU) No 269/2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (OJ 2023 L 226, p. 3).
(
3
)	Article 2(1)(g) of Council Decision 2014/145/CFSP of 17 March 2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine(OJ 2014 L 78, p. 16), as amended by Decision 2023/1094 (‘criterion (g), as amended’).
(
4
)	Article 2(1)(a) of Decision 2014/145/CFSP.
(
5
)	Article 2(1)(d) of Decision 2014/145/CFSP.