62023TJ0193_RES
Case T‑193/23
MegaFon OAO
v
Council of the European Union
Judgment of the General Court (First Chamber, Extended Composition) of 15 January 2025
(Common foreign and security policy – Restrictive measures adopted in view of Russia’s actions destabilising the situation in Ukraine – Lists of persons, entities and bodies subject to restrictive measures – Inclusion and maintenance of the applicant’s name on the lists – Right to be heard – Obligation to state reasons – Error of assessment – Proportionality – Freedom to conduct a business – Action for annulment)
Judicial proceedings – Time limit for producing evidence – Article 85(3) of the Rules of Procedure of the General Court – Submission of evidence before the oral part of the procedure is closed – Whether permissible – Conditions – Late submission that is justified – No justification – Additional evidence not admissible
(Rules of Procedure of the General Court, Art. 85(3))
(see paragraphs 31-34)
Acts of the institutions – Statement of reasons – Obligation – Scope – Restrictive measures taken in view of the situation in Ukraine – Prohibition of the sale, supply, transfer or export of dual use goods and technology to certain persons, entities or bodies in Russia – Prohibition of the sale, supply, transfer or export of goods and technology which might contribute to the technological enhancement of Russia’s defence and security sector to certain persons, entities or bodies in Russia – 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, second para., TFEU; Charter of Fundamental Rights of the European Union, Art. 41(2)(c); Council Decision 2014/512/CFSP, as amended by Decisions (CFSP) 2022/327, (CFSP) 2022/578, (CFSP) 2022/1271, (CFSP) 2023/434, (CFSP) 2023/1517 and (CFSP) 2024/422; Council Regulation No 833/2014, as amended by Regulation 2023/427)
(see paragraphs 42-44, 46, 55, 57)
Judicial proceedings – Application initiating proceedings – Formal requirements – Summary of the pleas in law on which the application is based – Facts and points of law set out in the application
(Rules of Procedure of the General Court, Art. 76(d))
(see paragraphs 63, 64)
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 – Limitations – Conditions – Difference between the initial act adopting the measure and the act maintaining that measure
(Charter of Fundamental Rights of the European Union, Arts 41(2)(a), 47 and 52(1))
(see paragraphs 70-74, 77-79, 81, 82, 86-88)
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 – Evidence submitted for the first time at the stage of the defence – Whether permissible – Condition – Evidence substantiating a fact known to all – Error of assessment – No error of assessment
(Charter of Fundamental Rights of the European Union, Art. 47; Council Decision 2014/512/CFSP, as amended by Decisions (CFSP) 2022/327, (CFSP) 2022/578, (CFSP) 2022/1271, (CFSP) 2023/434, (CFSP) 2023/1517 and (CFSP) 2024/422; Council Regulation No 833/2014, as amended by Regulation 2023/427)
(see paragraphs 110-114, 119, 123, 138-145)
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’s name on the lists annexed to the contested acts by virtue of its status as a provider of direct support for the Russian military and industrial complex – Publicly available documentary evidence – Admissibility
(Council Decision 2014/512/CFSP, as amended by Decisions (CFSP) 2022/327, (CFSP) 2022/578, (CFSP) 2022/1271, (CFSP) 2023/434, (CFSP) 2023/1517 and (CFSP) 2024/422; Council Regulation No 833/2014, as amended by Regulation 2023/427)
(see paragraphs 126-128)
Common foreign and security policy – Restrictive measures taken in view of the situation in Ukraine – Prohibition of the sale, supply, transfer or export of dual use goods and technology to certain persons, entities or bodies in Russia – Prohibition of the sale, supply, transfer or export of goods and technology which might contribute to the technological enhancement of Russia’s defence and security sector to certain persons, entities or bodies in Russia – Restriction on the freedom to conduct a business and on respect for reputation – Breach of the principle of proportionality – No breach
(Council Decision 2014/512/CFSP, as amended by Decisions (CFSP) 2022/327, (CFSP) 2022/578, (CFSP) 2022/1271, (CFSP) 2023/434, (CFSP) 2023/1517 and (CFSP) 2024/422; Council Regulation No 833/2014, as amended by Regulation 2023/427)
(see paragraphs 161-166)
Résumé
This case raises novel issues concerning the scope of the obligations on the Council of the European Union in relation to the compilation of an evidence file to support the validity of the inclusion of an entity’s name on a list relating to sectoral restrictive measures.
On 31 July 2014, as a result of the situation in Ukraine, the Council adopted Decision 2014/512 (
1
) and Regulation No 833/2014, (
2
) in order to introduce targeted restrictive measures, including on dual-use goods and sensitive technologies. Those acts were modified several times (
3
) following the military operation in Ukraine begun by the Russian Federation on 24 February 2022.
The Council then adopted a number of acts (
4
) by means of which MegaFon OAO, a company established in Moscow (Russia) and operating in the telecommunications sector, as an entity directly supporting the military and industrial complex of the Russian Federation in its war of aggression against Ukraine, was included and maintained on the lists of entities in respect of which restrictions are imposed on exports of dual-use goods and technology and of goods and technology which might contribute to the technological enhancement of Russia’s defence and security sector.
That company is seeking annulment of those acts, alleging, in particular, an infringement by the Council of its obligation to state reasons, an infringement of the rights of the defence and of the right to effective judicial protection and error of assessment by the Council in finding, incorrectly, that the applicant directly supported the Russian military and industrial complex.
The Court dismisses the action.
Findings of the Court
In the first place, as regards the plea alleging infringement by the Council of the obligation to state reasons, the Court recalls that the statement of reasons for an act imposing a restrictive measure must identify the actual and specific reasons why the Council considered that such a measure had to be adopted in respect of the person concerned, taking into account the context in which that act was adopted.
In the present case, the actual and specific reasons why the Council considered that the measures at issue had to be adopted in respect of the applicant, and therefore that its name had to be included on the lists at issue, correspond to the criteria set out in the relevant provisions and in the recitals of the contested acts, (
5
) that is to say, the applicant is an entity which directly supports the Russian military and industrial complex.
In that regard, reliance on the same considerations, relating to direct support for Russia’s military and industrial complex, in order to adopt restrictive measures aimed at more than one person does not mean that those considerations cannot give rise to a sufficiently specific statement of reasons for each of the persons concerned.
The applicant was therefore in a position to understand that its name had been included and maintained on the lists at issue because it was considered to be an entity directly supporting the military and industrial complex of Russia in its war of aggression against Ukraine, having regard to the fact that it was one of the principal mobile telephone and telecommunications operators in Russia and as a result of the political context at the time the contested acts were adopted.
In the second place, as regards the plea alleging infringement of the rights of the defence and of the right to effective judicial protection, the Court recalls that the right to be heard guarantees every person the opportunity to make known his or her views during an administrative procedure before the adoption of a decision liable to affect his or her interests adversely. Accordingly, during a procedure to adopt restrictive measures, the competent EU authority must communicate to the persons concerned the grounds and evidence relied on against them on which that authority proposes to base its decision, so that those persons may effectively make known their views on those grounds and on that evidence.
Nevertheless, limitations may be placed on the right to be heard, subject to certain conditions. (
6
) In particular, according to the Court’s case-law, the Council is not required to inform the person or entity concerned beforehand of the grounds on which it intends to rely in order to adopt restrictive measures in respect of that person or entity. The absence of any such obligation is explained by the need for an element of surprise in order for those measures to be effective and, ultimately, by overriding considerations to do with safety or the conduct of the international relations of the European Union and of its Member States.
In addition, neither the relevant provisions of the acts establishing restrictive measures nor the general principle of respect for the rights of the defence give the persons concerned a right to a formal hearing, since it is sufficient that they can make representations in writing.
In the present case, the initial acts had to take advantage of an element of surprise and the Council was therefore not obliged to hear the applicant before its initial listing.
However, on application by the applicant, the Council had an obligation to inform it of the grounds for applying those measures to it, immediately after those acts were adopted, so that it could make known its views on those grounds. (
7
)
In the present case, following the applicant’s requests, the Council replied to it, in essence, that the ground justifying the inclusion of its name on the lists at issue – that is to say, the fact that it is allegedly an entity which directly supports the Russian military and industrial complex – was to be found in the relevant provisions of the initial listing acts.
Therefore, the applicant was able to understand the grounds for the inclusion of its name on the lists at issue, which enabled it to defend its rights in the best possible conditions.
As regards the decision to maintain the restrictive measures taken against a person, the Court recalls that the Council must (i) disclose to the person concerned, before it adopts its decision, the new evidence available to it on which it can base that decision and on which it relied in order to update the information concerning the personal situation of the person concerned and the situation in the third country at issue and (ii) obtain that person’s comments on that new evidence.
In the present case, the grounds of the maintaining acts do not differ from those of the initial acts, with the result that the Council was not required to hear the applicant before adopting those acts.
In the third place, as regards the plea alleging error of assessment, the Court examines first of all whether the Council was entitled to rely on the evidence submitted at the stage of the defence. The court recalls that non-disclosure by the Council of the evidence on the basis of which it included a person’s name on a list for the purposes of restrictive measures is not capable of undermining that person’s rights of defence where that evidence constitutes a known context, that is to say, it is publicly available and, accordingly, may be presumed to be known to all. In the present case, the Court finds that the fact that, in a time of war, one of the major telecommunications operators of the Russian Federation, such as the applicant, participates in directly supporting that country’s military and industrial complex, may be presumed to be known to all. Accordingly, the Council is not in principle required to provide documents, where the alleged facts which served as a basis for the inclusion on the lists at issue may be presumed to be known to all. Furthermore, the Court finds that, in the event of a challenge, the Council is entitled to submit documents which are widely available in the public domain to the Court in order to support the accuracy of a fact known to all.
Next, the Court finds that the evidence provided by the Council is reliable and relevant. First, the provision of roaming services by the applicant in certain Russian-controlled regions of Ukraine and the provision of telecommunications services in Crimea that is apparent from webpage articles are likely further to undermine Ukraine’s territorial integrity. Accordingly, they constitute evidence confirming the applicant’s support for the Russian military and industrial complex. Second, the Council has provided publicly available press articles referring to the presence of infrastructure belonging to the applicant in the Kharkiv region. Third, the Council adduces extracts from a webpage containing a list of the contracts concluded between the Russian army and the applicant between 2013 and 2021, testifying to the existence of a long-term link between the applicant and that army which bears out the line of argument that the applicant is an entity which directly supports the military and industrial complex of the Russian Federation.
(
1
)	Council Decision 2014/512/CFSP of 31 July 2014 concerning restrictive measures in view of Russia's actions destabilising the situation in Ukraine (OJ 2014 L 229, p. 13).
(
2
)	Council Regulation (EU) No 833/2014 of 31 July 2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ 2014 L 229, p. 1).
(
3
)	Decision 2014/512 was amended by Decisions (CFSP) 2022/327 of 25 February 2022 (OJ 2022 L 48, p. 1), (CFSP) 2022/578 of 8 April 2022 (OJ 2022 L 111, p. 70) and (CFSP) 2022/1271 of 21 July 2022 (OJ 2022 L 193, p. 196). Regulation No 833/2014 was amended by Council Regulations (EU) 2022/328 of 25 February 2022 (OJ 2022 L 49, p. 1), (EU) 2022/576 of 8 April 2022 (OJ 2022 L 111, p. 1) and (EU) 2022/1269 of 21 July 2022 (OJ 2022 L 193, p. 1).
(
4
)	These consisted, first, of Council Decision (CFSP) 2023/434 of 25 February 2023 amending Council Decision 2014/512/CFSP concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ 2023 L 59 I, p. 593) and of Council Regulation (EU) 2023/427 of 25 February 2023 amending Regulation (EU) No 833/2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ 2023 L 59 I, p. 6); second, of Council Decision (CFSP) 2023/1517 of 20 July 2023 amending Decision 2014/512/CFSP concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ 2023 L 184, p. 40); and, third, of Council Decision (CFSP) 2024/422 of 29 January 2024 amending Decision 2014/512/CFSP concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine (OJ L 2024/422).
(
5
)	In particular, recital 10 of Decision 2023/434 and Articles 3, 3a and 3b of Decision 2014/512, as amended, and also recital 4 of Regulation 2023/427 and Articles 2, 2a and 2b of Regulation No 833/2014, as amended.
(
6
)	Under Article 52(1) of the Charter of Fundamental Rights of the European Union.
(
7
)	See judgment 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 100 and the case-law cited).