1 By their appeal, Rosneft Oil Company PAO , formerly NK Rosneft OAO, RN-Shelf-Arctic OOO, RN-Shelf-Far East AO, formerly RN-Shelf-Dalniy Vostok ZAO, RN-Exploration OOO, and Tagulskoe OOO ask the Court to set aside the judgment of the General Court of the European Union of 13 September 2018, Rosneft and Others v Council , (T‑715/14, not published, ‘the judgment under appeal’, EU:T:2018:544), whereby the General Court dismissed their action seeking the annulment of, first, Article 1(2)(b) to (d) and (3) of, and Annex III to, 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), as amended by Council Decision (CFSP) 2016/2315 of 19 December 2016 (OJ 2016 L 345, p. 65) (‘the contested decision’), and, second, Articles 3 and 3a, Article 4(3) and (4), Article 5(2)(b) to (d) and (3), and Article 11 of, as well as Annexes II and VI to, 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), as amended by Council Regulation (EU) No 1290/2014 of 4 December 2014 (OJ 2014 L 349, p. 20, and corrigendum OJ 2014 L 246, p. 59) (‘the contested regulation’) (together ‘the contested acts’). Legal context International law The EU-Russia Partnership Agreement
2 The Partnership and Cooperation Agreement establishing a partnership between the European Communities and their Member States, on the one part, and the Russian Federation of the other part, signed in Corfu on 24 June 1994, was approved on behalf of the European Communities by Council and Commission Decision 97/800/ECSC, EC, Euratom of 30 October 1997 (OJ 1997 L 327, p. 1; ‘the EU-Russia Partnership Agreement’). Within Title XI of that agreement, entitled ‘Institutional, general and final provisions’, Article 99 of that agreement provides: ‘Nothing in this Agreement shall prevent a Party from taking any measures: (1) which it considers necessary for the protection of its essential security interests: … (d) in the event of serious internal disturbances affecting the maintenance of law and order, in time of war or serious international tension constituting threat of war or in order to carry out obligations it has accepted for the purpose of maintaining peace and international security; …’ World Trade Organisation (WTO) rules
3 Article XXI of the General Agreement on Tariffs and Trade (GATT) provides: ‘Nothing in this Agreement shall be construed: (a) to require any contracting party to furnish any information the disclosure of which it considers contrary to its essential security interests; or (b) to prevent any contracting party from taking any action which it considers necessary for the protection of its essential security interests: (i) relating to fissionable materials or the materials from which they are derived; (ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials as is carried on directly or indirectly for the purpose of supplying a military establishment; (iii) taken in time of war or other emergency in international relations; or (c) to prevent any contracting party from taking any action in pursuance of its obligations under the United Nations Charter for the Maintenance of international peace and security.’ The contested acts The contested decision
4 Recitals 1 to 8 of the contested decision set out the circumstances that preceded the adoption of the restrictive measures that it imposes.
5 Article 1(2) and (3) of that decision provide: ‘2. The direct or indirect purchase or sale of, the direct or indirect provision of investment services for, or assistance in the issuance of, or any other dealing with bonds, equity, or similar financial instruments with a maturity exceeding 30 days, issued after 12 September 2014 by … (b) entities established in Russia which are publicly controlled or with over 50% public ownership which have estimated total assets of over 1 trillion Russian Roubles and whose estimated revenues originate for at least 50% from the sale or transportation of crude oil or petroleum products as of 12 September 2014, as listed in Annex III; (c) any legal person, entity or body established outside the Union owned for more than 50% by an entity referred to in [point] …(b); or (d) any legal person, entity or body acting on behalf, or at the direction, of an entity within the category referred to in point (c) or listed in Annex … III, shall be prohibited. 3. It shall be prohibited to directly or indirectly make or be part of any arrangement to make new loans or credit with a maturity exceeding 30 days to any legal person, entity or body referred to in paragraph 1 or 2, after 12 September 2014 except for loans or credit that have a specific and documented objective to provide financing for non-prohibited direct or indirect imports or exports of goods and non-financial services between the Union and Russia or any other third State, or for loans that have a specific and documented objective to provide emergency funding to meet the solvency and liquidity criteria for legal persons established in the Union, whose proprietary rights are owned for more than 50% by an entity referred to in Annex I.’
6 Annex III to the contested Decision contains a list of legal persons entities and bodies referred to in Article 1(2)(b) of that decision, Rosneft being one of those listed. The contested regulation
7 Recital 2 of the contested regulation states: ‘On 22 July 2014, the Council [of the European Union] concluded that should Russia fail to respond to the demands formulated in the European Council conclusions of 27 June 2014 and in its own conclusions of 22 July, it would be ready to introduce without delay a package of further significant restrictive measures. It is therefore considered appropriate to apply additional restrictive measures with a view to increasing the costs of Russia’s actions to undermine Ukraine’s territorial integrity, sovereignty and independence and to promoting a peaceful settlement of the crisis. …’
8 Article 1(f)(i) of that regulation defines ‘transferable securities’ as meaning ‘shares in companies and other securities equivalent to shares in companies, partnerships or other entities and depositary receipts in respect of shares’.
9 Article 3 of that regulation provides: ‘1. A prior authorisation shall be required for the sale, supply, transfer or export, directly or indirectly, of items as listed in Annex II, whether or not originating in the Union, to any natural or legal person, entity or body in Russia, including its Exclusive Economic Zone and Continental Shelf or in any other State, if such items are for use in Russia, including its Exclusive Economic Zone and Continental Shelf. 2. For all sales, supplies, transfers or exports for which an authorisation is required under this Article, such authorisation shall be granted by the competent authorities of the Member State where the exporter is established and shall be in accordance with the detailed rules laid down in Article 11 of [Council] Regulation (EC) No 428/2009 [of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items (OJ 2009 L 134, p. 1)]. The authorisation shall be valid throughout the Union. 3. Annex II shall include certain items suited to the following categories of exploration and production projects in Russia, including its Exclusive Economic Zone and Continental Shelf: (a) oil exploration and production in waters deeper than 150 metres; (b) oil exploration and production in the offshore area north of the Arctic Circle; or (c) projects that have the potential to produce oil from resources located in shale formations by way of hydraulic fracturing; it does not apply to exploration and production through shale formations to locate or extract oil from non-shale reservoirs. 4. Exporters shall supply the competent authorities with all relevant information required for their application for an export authorisation. 5. The competent authorities shall not grant any authorisation for any sale, supply, transfer or export of the items included in Annex II, if they have reasonable grounds to determine that the sale, supply, transfer or export of the items are destined for any of the categories of exploration and production projects referred to in paragraph 3. The competent authorities may, however, grant an authorisation where the sale, supply, transfer or export concerns the execution of an obligation arising from a contract concluded before 1 August 2014, or ancillary contracts necessary for the execution of such a contract. The competent authorities may also grant an authorisation where the sale, supply, transfer or export of the items is necessary for the urgent prevention or mitigation of an event likely to have a serious and significant impact on human health and safety or the environment. In duly justified cases of emergency, the sale, supply, transfer or export may proceed without prior authorisation, provided that the exporter notifies the competent authority within five working days after the sale, supply, transfer or export has taken place, providing detail about the relevant justification for the sale, supply, transfer or export without prior authorisation. 6. Under the conditions set out in paragraph 5, the competent authorities may annul, suspend, modify or revoke an export authorisation which they have granted. 7. Where a competent authority refuses to grant an authorisation, or annuls, suspends, substantially limits or revokes an authorisation in accordance with paragraphs 5 or 6, the Member State concerned shall notify the other Member States and the Commission thereof and share the relevant information with them, while complying with the provisions concerning the confidentiality of such information in Council Regulation (EC) No 515/97 [of 13 March 1997 on mutual assistance between the administrative authorities of the Member States and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters (OJ 1997 L 82, p. 1)]. 8. Before a Member State grants an authorisation in accordance with paragraph 5 for a transaction which is essentially identical to a transaction which is the subject of a still valid denial issued by another Member State or by other Member States under paragraphs 6 and 7, it shall first consult the Member State or States which issued the denial. If, following such consultations, the Member State concerned decides to grant an authorisation, it shall inform the other Member States and the Commission thereof, providing all relevant information to explain the decision.’
10 Article 3a of that regulation provides: ‘1. It shall be prohibited to provide, directly or indirectly, associated services necessary for the following categories of exploration and production projects in Russia, including its Exclusive Economic Zone and Continental Shelf: (a) oil exploration and production in waters deeper than 150 metres; (b) oil exploration and production in the offshore area north of the Arctic Circle; or (c) projects that have the potential to produce oil from resources located in shale formations by way of hydraulic fracturing; it does not apply to exploration and production through shale formations to locate or extract oil from non-shale reservoirs. For the purpose of this paragraph, associated services shall mean: (i) drilling; (ii) well testing; (iii) logging and completion services; (iv) supply of specialised floating vessels. 2. The prohibitions in paragraph 1 shall be without prejudice to the execution of an obligation arising from a contract or a framework agreement concluded before 12 September 2014 or ancillary contracts necessary for the execution of such a contract. 3. The prohibitions in paragraph 1 shall not apply where the services in question are necessary for the urgent prevention or mitigation of an event likely to have a serious and significant impact on human health and safety or the environment. The service provider shall notify the competent authority within five working days of any activity undertaken pursuant to this paragraph, providing detail about the relevant justification for the sale, supply, transfer or export.’
11 Article 4(3) and (4) of the contested regulation is worded as follows: ‘3. The provision of the following shall be subject to an authorisation from the competent authority concerned: (a) technical assistance or brokering services related to items listed in Annex II and to the provision, manufacture, maintenance and use of those items, directly or indirectly, to any natural or legal person, entity or body in Russia, including its Exclusive Economic Zone and Continental Shelf or, if such assistance concerns items for use in Russia, including its Exclusive Economic Zone and Continental Shelf, to any person, entity or body in any other State; (b) financing or financial assistance related to items referred to in Annex II, including in particular grants, loans and export credit insurance, for any sale, supply, transfer or export of those items, or for any provision of related technical assistance, directly or indirectly, to any natural or legal person, entity or body in Russia, including its Exclusive Economic Zone and Continental Shelf or, if such assistance concerns items for use in Russia, including its Exclusive Economic Zone and Continental Shelf, to any person, entity or body in any other State. In duly justified cases of emergency referred to in Article 3(5), the provision of services referred to in this paragraph may proceed without prior authorisation, on condition that the provider notifies the competent authority within five working days after the provision of services. 4. Where authorisations are requested pursuant to paragraph 3 of this Article, Article 3, and in particular paragraphs 2 and 5 thereof, shall apply mutatis mutandis.’
12 Article 5(2) and (3) of that regulation provides: ‘2. It shall be prohibited to directly or indirectly purchase, sell, provide investment services for or assistance in the issuance of, or otherwise deal with, transferable securities and money-market instruments with a maturity exceeding 30 days, issued after 12 September 2014 by: … (b) a legal person, entity or body established in Russia, which are publicly controlled or with over 50% public ownership and having estimated total assets of over 1 trillion Russian Roubles and whose estimated revenues originate for at least 50% from the sale or transportation of crude oil or petroleum products, as listed in Annex VI; (c) a legal person, entity or body established outside the Union whose proprietary rights are directly or indirectly owned for more than 50% by an entity listed in point (a) or (b) of this paragraph; or (d) a legal person, entity or body acting on behalf or at the direction of an entity referred to in point (a), (b) or (c) of this paragraph. 3. It shall be prohibited to directly or indirectly make or be part of any arrangement to make new loans or credit with a maturity exceeding 30 days to any legal person, entity or body referred to in paragraph 1 or 2, after 12 September 2014. The prohibition shall not apply to: (a) loans or credit that have a specific and documented objective to provide financing for non-prohibited imports or exports of goods and non-financial services between the Union and any third State, including the expenditure for goods and services from another third State that is necessary for executing the export or import contracts; or (b) loans that have a specific and documented objective to provide emergency funding to meet solvency and liquidity criteria for legal persons established in the Union, whose proprietary rights are owned for more than 50% by any entity referred to in Annex III.’
13 Annex VI to the contested regulation contains a list of legal persons entities and bodies referred to in Article 5(2)(b) of that regulation, one of those listed being Rosneft.
14 Article 8(1) of that regulation provides: ‘Member States shall lay down the rules on penalties applicable to infringements of the provisions of this Regulation and shall take all measures necessary to ensure that they are implemented. The penalties provided for must be effective, proportionate and dissuasive.’
15 Article 11 of that regulation provides: ‘1. No claims in connection with any contract or transaction the performance of which has been affected, directly or indirectly, in whole or in part, by the measures imposed under this Regulation, including claims for indemnity or any other claim of this type, such as a claim for compensation or a claim under a guarantee, notably a claim for extension or payment of a bond, guarantee or indemnity, particularly a financial guarantee or financial indemnity, of whatever form, shall be satisfied, if they are made by: (a) entities referred to in points (b) and (c) of Article 5(1) and points (c) and (d) of Article 5(2), or listed in Annexes III, IV, V and VI; (b) any other Russian person, entity or body; (c) any person, entity or body acting through or on behalf of one of the persons, entities or bodies referred to in points (a) and (b) of this paragraph. 2. In any proceedings for the enforcement of a claim, the onus of proving that satisfying the claim is not prohibited by paragraph 1 shall be on the person seeking the enforcement of that claim. 3. This Article is without prejudice to the right of the persons, entities and bodies referred to in paragraph 1 to judicial review of the legality of the non-performance of contractual obligations in accordance with this Regulation.’
16 Annex II to the contested regulation lists the items of which sale, supply, transfer or export to Russia is subject to the obtaining of a prior authorisation, in accordance with Article 3 of that regulation. Background to the dispute
17 The background to the dispute, as set out in paragraphs 1 to 14 of the judgment under appeal, may be summarised as follows.
18 On 20 February 2014 the Council of the European Union condemned the use of violence in Ukraine, called for an immediate end to the violence and full respect for human rights and decided to introduce restrictive measures against those responsible. On 3 March 2014 the Council condemned the acts of aggression by the Russian armed forces in Ukrainian territory and called on the Russian Federation to respect its international obligations, and thereafter adopted, on 5 March 2014, restrictive measures for freezing funds and the recovery of misappropriated Ukrainian State funds. At an extraordinary meeting held on 6 March 2014, the Heads of State or Government of the Member States of the European Union condemned the unprovoked violation by the Russian Federation of Ukrainian sovereignty and territorial integrity. They endorsed the measures proposed by the Council to suspend bilateral talks with the Russian Federation on visa matters and on the new comprehensive partnership and cooperation agreement between the European Union and its Member States, of the one part, and the Russian Federation, of the other part, and stated that any further steps by the Russian Federation to destabilise the situation in Ukraine would lead to far reaching consequences for relations in a broad range of economic areas between the European Union and its Member States, on the one hand, and the Russian Federation, on the other.
19 Thereafter, the Council adopted, within the framework of the Common Foreign and Security Policy (CFSP), a set of restrictive measures in response to the actions of the Russian Federation that were regarded as destabilising the situation in Ukraine.
20 On 31 July 2014, in view of the gravity of the situation in Ukraine, despite the adoption in March 2014 of travel restrictions and asset freezes imposed on certain natural and legal persons, the Council adopted Decision 2014/512, in order to introduce targeted restrictive measures in the areas of access to capital markets, defence, dual-use goods, and sensitive technologies, including in the energy sector.
21 On the same date, the Council adopted Regulation No 833/2014, which contains more detailed provisions to give effect at both EU level and Member State level to the requirements in Decision 2014/512.
22 The declared objective of those restrictive measures was to increase the costs of the actions of the Russian Federation that were designed to undermine Ukraine’s territorial integrity, sovereignty and independence, and to promote a peaceful settlement of the crisis. To that end, Decision 2014/512 established, in particular, prohibitions on the export of certain sensitive products and technologies to the oil sector in Russia and restrictions on the access of certain operators in that sector to the EU capital market.
23 On 8 September 2014 the Council adopted Decision 2014/659/CFSP amending Decision 2014/512 (OJ 2014 L 271, p. 54), and Regulation (EU) No 960/2014 amending Regulation No 833/2014 (OJ 2014 L 271, p. 3), in order to extend the prohibition decided on 31 July 2014 in relation to certain financial instruments and to impose additional restrictions on access to the capital market for certain Russian entities operating in the oil sector.
24 Since 8 September 2014 the appellants, Rosneft Oil Company, RN-Shelf-Arctic, RN-Shelf-Far East, RN-Exploration and Tagulskoe, all commercial companies incorporated under Russian law and members of the Rosneft group of companies (‘Rosneft’), established in Moscow (Russia) and specialising in the oil and gas sectors, have been listed as entities that are subject to restrictive measures, the lists being annexed to the contested acts. When various amendments were made to those acts between 2014 and 2016, Rosneft continued to be listed.
25 One of the appellants, Rosneft Oil Company, brought an action before the courts of the United Kingdom, challenging the national measures designed to give effect to the restrictive measures adopted by the Council by Decision 2014/512, as amended by Council Decision 2014/872/CFSP of 4 December 2014 (OJ 2014 L 349, p. 58), and the contested regulation. Rosneft Oil Company claimed in those proceedings that both the restrictive measures adopted by the Council and the national measures were invalid. The action before the General Court and the judgment under appeal
26 By application lodged at the Registry of the General Court on 9 October 2014, the appellants sought the annulment of Article 1(2)(b) to (d) and (3) of, and Annex III to, Decision 2014/512, as amended by Decision 2014/659, and of Articles 3 and 3a, Article 4(3) and (4), Article 5(2)(b) to (d) and (3) and Article 11 of, and of Annexes II and VI to, Regulation No 833/2014, as amended by Regulation No 960/2014. When Decision 2014/512 and Regulation No 833/2014 were amended by subsequent acts, the appellants adapted their initial forms of order, and, in the final form of their pleadings, sought the annulment of the contested acts.
27 In support of their action, the appellants relied on nine pleas in law: (i) infringement of the obligation to state reasons, the rights of the defence and the right to effective judicial protection; (ii) the lack of any legitimate aim behind the adoption of the measures at issue; (iii) infringement of the European Union’s international obligations under the EU-Russia Partnership Agreement, and under GATT; (iv) the lack of any rational connection between the objective pursued and the means of giving effect to it; (v) the claim that the provisions of the contested regulation on authorisation were not an appropriate means of giving effect to the contested decision; (vi) breach of the principle of equal treatment and non-arbitrariness; (vii) the fact that the measures were disproportionate, involving encroachment on EU legislative competences and infringement of the appellants’ fundamental rights; (viii) misuse of powers, and, last, (ix) breach of the constitutional guarantees of legal certainty.
28 On 12 February 2015 the appellants requested that the case before the General Court be stayed on the ground that a request for a preliminary ruling had been referred to the Court of Justice by the High Court of Justice (England & Wales), Queen’s Bench Division (Divisional Court), concerning, inter alia, the validity of Decision 2014/512, as amended by Decision 2014/872, and of the contested regulation.
29 By order of 26 March 2015, the President of the Ninth Chamber of the General Court decided to stay Case T‑715/14 until the decision of the Court bringing an end to the proceedings in Case C‑72/15, Rosneft .
30 The proceedings were resumed after the delivery of the judgment of 28 March 2017, Rosnef t (C‑72/15, EU:C:2017:236). By that judgment, the Court held, inter alia, that examination of the second question referred had revealed nothing capable of affecting the validity of Article 1(2)(b) to (d) and (3) and Article 7 of, and of Annex III to, Decision 2014/512, as amended by Decision 2014/872, or of Articles 3 and 3a, Article 4(3) and (4), Article 5(2)(b) to (d) and (3) and Article 11 of, and Annexes II and VI to, the contested regulation.
31 The General Court, first, in paragraphs 64 to 93 of the judgment under appeal, rejected the objections of inadmissibility submitted by the Council and the Commission, to the effect that the conditions governing the bringing of proceedings laid down in the fourth paragraph of Article 263 TFEU were not satisfied, on the ground that the appellants had no standing to bring proceedings against the provisions of the contested acts.
32 As regards the provisions establishing the restrictive measures provided for in Article 1(2)(b) to (d) and (3) of, and in Annex III to, the contested decision, and in Article 5(2)(b) to (d) and (3) and Article 11 of, and in Annex VI to, the contested regulation (‘the restrictions on access to capital markets’), the General Court held, in the first place, that those provisions were of direct concern to the appellants, since it was impossible for the appellants to carry out certain prohibited financial transactions with bodies established in the European Union, although they would have been entitled to carry out such transactions in the absence of those provisions, and that those provisions left no discretion to the addressees entrusted with their implementation. The General Court held, in the second place, that those provisions were also of individual concern to the appellants, since the appellants were owned, directly or indirectly, by Rosneft, which was listed in Annex III to the contested decision and in Annex VI to the contested regulation.
33 As regards the provisions establishing the restrictive measures provided for in Articles 3 and 3a and Article 4(3) and (4) of, and in Annex II to, the contested regulation (‘the export restrictions’), the General Court held, in the first place, that even though those provisions were of general application, they were of direct concern to the appellants, since the national authorities had no discretion in giving effect to the prohibitions and authorisations prescribed by those provisions which were applicable in the appellants’ area of activity. In the second place, the General Court held that those provisions constituted regulatory acts not entailing implementing measures, within the meaning of the last clause of the fourth paragraph of Article 263 TFEU.
34 Second, before examining the substance of the pleas in law relied on, the General Court rejected, in paragraphs 96 to 99 of the judgment under appeal, the Council’s argument that, since the pleas in law relied on in support of annulment in the instant case before it were identical to those relied on in the case that gave rise to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), delivered following a reference for a preliminary ruling, the grounds on which the Court based its answer to those pleas had the authority of res judicata , and those pleas in law had, consequently, of necessity to be rejected. The General Court stated in that regard that two cases cannot have the same subject matter and the same cause of action when the legal basis of those two cases is different.
35 Third, the General Court, in paragraphs 102 to 236 of the judgment under appeal, examined and rejected each of the nine pleas in law relied on by the appellants and, consequently, dismissed the action in its entirety. Forms of order sought by the parties before the Court of Justice
36 The appellants claim that the Court should: - set aside the judgment under appeal; - give a final judgment in the matter or refer the case back to the General Court for judgment; and - order the Council to pay the costs, including the costs incurred before the General Court.
37 The Council contends that the Court should: - dismiss the appeal; - in the alternative, if the Court decides to set aside the judgment under appeal and to give final judgment itself, dismiss the application for annulment of the contested acts; and - order the appellants to pay the costs relating to the appeal.
38 The Commission contends that the Court should: - dismiss the appeal; and - order the appellants to pay the costs. The appeal Admissibility Arguments of the parties
39 The Council argues that the admissibility of the appeal and the grounds of appeal should be assessed in the light of the matters of law already examined in the judgment of 28 March 2017, Rosneft , (C‑72/15, EU:C:2017:236), whereby the Court confirmed the validity of, first, Article 1(2)(b) to (d) and (3) and Article 7 of, and Annex III to, Decision 2014/512, as amended by Decision 2014/872 and, second, Articles 3 and 3a, Article 4(3) and (4), Article 5(2)(b) to (d) and (3), and Article 11 of, and Annexes II and VI to, the contested regulation.
40 In the first place, the Council accordingly submits that the grounds of appeal concerning the legality of the provisions of the contested acts are inadmissible, since only those grounds relating to any errors in law committed by the General Court in its application of that judgment can be examined.
41 The Council considers that, by their appeal, the appellants’ aim is that the Court should revisit that judgment, which concerned the legality of the same acts as those at issue in this instance and in which the same pleas or grounds were relied on by the same parties. In the view of the Council, if the present appeal proceedings were to be declared to be admissible that would amount to allowing parties the possibility of bringing actions against judgments delivered by the Court in response to references for a preliminary ruling and, therefore, would circumvent the restrictive conditions governing revision of judgments of the Court.
42 The Council also states that it is clear from the case-law deriving from the judgment of 9 March 1994, TWD Textilwerke Deggendorf (C‑188/92, EU:C:1994:90), that the legal remedies provided for by EU law are subject to specific procedural rules which must not be interpreted in such a way that it becomes possible to challenge, without any limitation in time, legislative acts.
43 In the second place, the Council considers that the General Court ought, on the basis of the authority of res judicata , to have dismissed the action before it as being inadmissible. The Council submits that, in circumstances such as the present, where the differences in how the action is brought before the court with jurisdiction (direct, in the case of an action for annulment, indirect, in the case of a reference for a preliminary ruling) have no bearing on the outcome of the case, it would be in the interests of the stability of the law to accord to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), the authority of res judicata . The Council states that, in the judgment under appeal, the General Court had no precedent available to it on which it could rely to justify extending the possibility of applying the authority of res judicata to proceedings of different kinds. However, the Court should extend that possibility, in order to strengthen the EU system of legal remedies with the objective of achieving stability of the law and procedural economy.
44 The Commission submits that, although the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), does not have the authority of res judicata for the purposes of the present proceedings, that judgment largely concerns the validity of the same acts as those at issue in the present case and the same issues of interpretation of those acts. Consequently, the Commission considers that the General Court, in the judgment under appeal, was correct to rely on the findings made by the Court in the judgment of 28 March 2017, Rosneft (C--72/15, EU:C:2017:236).
45 In their reply, the appellants maintain, first, that the objection made by the Council to the effect that their appeal and the grounds relied on are inadmissible must be rejected. The appellants argue, in particular, that the approach of the judgment of 9 March 1994, TWD Textilwerke Deggendorf (C‑188/92, EU:C:1994:90), is of no relevance in this instance, and that the consequence of the Council’s position would be to undermine the right to a fair hearing and the representation of the parties, since four of the five appellants in the present proceedings did not participate in the national proceedings that gave rise to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236).
46 Second, the appellants maintain that, by their arguments in relation to the authority of res judicata , the Council has in fact brought a cross-appeal, which is inadmissible.
47 Third, the appellants argue that, even if those arguments are admissible, they should, in any event, be rejected as being unfounded. The appellants submit that the Council’s position is contrary to Article 61 of the Statute of the Court of Justice of the European Union, which provides that, where the General Court is seised of a dispute, that court is bound by the judgments of the Court only in situations where the Court refers a case back to the General Court after an appeal. The appellants further claim that the Council’s position fails to take account of the fact that preliminary ruling proceedings are very different from direct actions.
48 In its rejoinder, the Council argues that a finding by the Court that an act is valid, made in a judgment entailing a declaration of validity delivered on the basis of Article 267 TFEU, has an erga omnes effect with respect to the issues resolved in that judgment. Accordingly, even if the parties to the present appeal and to the national proceedings that gave rise to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), are not entirely the same, the effect of that judgment is that the contested acts cannot be declared to be invalid on the basis of the same arguments as those examined in that judgment.
49 The Council also states that the exercise of the right to challenge the validity of an act by means of a reference for a preliminary ruling ought to bring to an end the possibility of challenging the validity of that act in the form of an action for annulment. Findings of the Court
50 By its arguments, the Council claims, in essence, that the authority of res judicata attached to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), must lead the Court to declare inadmissible the grounds of appeal relied on by the appellants that relate to matters of law on which the Court has already given a ruling in that judgment.
51 As stated by the General Court in paragraph 98 of the judgment under appeal, the pleas in law and arguments relied on by the appellants before it broadly overlapped with those at issue in the case that gave rise to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236).
52 In accordance with settled case-law, the attachment of the authority of res judicata to a judgment, which is intended to ensure stability of the law and legal relations and the sound administration of justice, means that judicial decisions which have become definitive after all rights of appeal have been exhausted or after expiry of the time limits provided for in that connection can no longer be called into question (judgment of 2 April 2020, CRPNPAC and Vueling Airlines , C‑370/17 and C‑37/18, EU:C:2020:260, paragraph 88 and the case-law cited). It is, however, also clear from the Court’s case-law that the authority of res judicata attaches only to matters of fact and law that have been actually or necessarily resolved by the judicial decision in question (judgment of 29 March 2011, ThyssenKrupp Nirosta v Commission , C‑352/09 P, EU:C:2011:191, paragraph 123 and the case-law cited), and bars an action from being admissible only if the action that gave rise to the judgment in question was between the same parties, had the same subject matter and was based on the same cause of action (see, to that effect, judgments of 19 September 1985, Hoogovens Groep v Commission , 172/83 and 226/83, EU:C:1985:355, paragraph 9, and the order of 3 July 1986, France v Parliament , 358/85, EU:C:1986:286, paragraph 12).
53 The case-law cited in the preceding paragraph of the present judgment is based on the premiss that the judicial decision that is relied on in support of an objection based on the authority of res judicata brings to an end a dispute between parties. That cannot be said of a judgment delivered in preliminary ruling proceedings.
54 In any event, even if a judgment delivered in preliminary ruling proceedings might be relied on in support of such an objection, it must be stated, as the appellants have correctly pointed out, and as is acknowledged by the Council, that four of the appellants did not participate in the national court proceedings that led to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236). They were therefore not parties to those proceedings.
55 Case T‑715/14, which gave rise to the judgment under appeal, was therefore not between the same parties as those involved in the case that gave rise to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236).
56 It cannot therefore be held that the conditions governing recognition that the authority of res judicata attaches to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), are satisfied in this instance.
57 It follows that the Council’s arguments concerning the inadmissibility of some grounds of appeal because of the authority of res judicata attached to the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), must be rejected. Substance
58 In support of their appeal, the appellants rely on seven grounds of appeal. The first ground of appeal - Arguments of the parties
59 By the first ground of appeal, the appellants claim that the General Court erred in law, in paragraphs 114 and 118 of the judgment under appeal, in holding that the Council had fulfilled its obligation to state reasons as provided for in Article 296 TFEU when it adopted the provisions relating to the export restrictions.
60 In the first place, the appellants maintain that the General Court held, wrongly, in paragraph 114 of the judgment under appeal, that those restrictions were of general application, and that, consequently, the Council could confine itself to indicating, first, the overall situation which led to their adoption and, second, the general objectives which they are intended to achieve. That finding, according to the appellants, is contradicted by the finding made in paragraph 157 of the judgment under appeal, where the General Court accepted that those restrictions were intended to ‘[target] undertakings in the Russian oil sector, on the basis notably of their estimated total assets of over RUB 1 trillion’. That finding is also incompatible with the information submitted by the appellants to the General Court, from which it is clear that the Council had adopted those restrictions with only two undertakings ‘in mind’, namely Rosneft and the Gazprom group. That finding is claimed, last, to be incompatible with other information submitted to the General Court by the appellants concerning the condition that the contested acts were of individual concern to the appellants, that information neither being examined nor taken into account by the General Court in the judgment under appeal.
61 In the second place, the appellants claim that, even if the export restrictions were not strictly ‘individual’ in nature, the General Court could not take the view, relying on the judgment of 19 November 1998, Spain v Council (C‑284/94, EU:C:1998:548), that no actual or specific reasons needed to be stated for them. If the obligation to state reasons laid down in Article 296 TFEU is to be satisfied, the appellants consider that the Council ought, at a minimum, to have indicated clearly, unequivocally and specifically the immediate objective pursued by those restrictions, which the Council failed to do.
62 The Council and the Commission contest the appellants’ arguments. - Findings of the Court
63 First, it must be observed that, as the General Court stated in paragraph 114 of the judgment under appeal, the Court held, in paragraph 119 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), that the restrictions, targeting the oil sector, established by Articles 3 and 3a and Article 4(3) and (4) of, and Annex II to, the contested regulation, namely the export restrictions, constituted acts of general application which are accordingly not targeted at identified or identifiable natural or legal persons.
64 None of the arguments relied on by the appellants is sufficient to call into question that categorisation of those restrictions.
65 As regards the argument that there is allegedly a contradiction between the reasons stated in paragraphs 114 and 157 of the judgment under appeal, suffice it to state that, even if there is such a contradiction, that is not capable of calling into question the merits of the finding by the General Court in paragraph 114, that finding being consistent with the case-law of the Court deriving from the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236, paragraph 119).
66 Further, since the adoption of restrictive measures of general application targeting a specific sector of the economy may lead to a situation in which, because of the specific characteristics of that sector, where certain natural resources, particular expertise and significant investment are required, the number of actors in that sector may be quite limited, the fact that only two groups were affected by the export restrictions at issue, and that the Council was aware of that, cannot call into question the finding by the General Court that the export restrictions were of general application.
67 Last, in so far as the appellants claim that the General Court failed to take account of the information that they submitted to that court concerning those restrictions being of individual concern to them, information which they claim the General Court did not examine or take into account, it must be observed that the appellants have failed to specify what that information was, and have done no more than refer to replies to questions that they had lodged with the General Court. It is not, however, for the Court to seek out and identify, in those replies, what information it was that was submitted by the appellants that would support their arguments.
68 Second, the Court must reject the argument that, even if the export restrictions were not strictly ‘individual’ in nature, the General Court could not take the view, relying on the judgment of 19 November 1998, Spain v Council (C‑284/94, EU:C:1998:548), that no actual or specific reasons needed to be stated for those restrictions. In that regard, it must be observed that the General Court applied the case-law deriving from the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236 , paragraph 120 ), to the effect that the extent of the obligation to state reasons depends on the nature of the measure in question, and that in the case of measures intended to have general application, the statement of reasons may be limited to indicating the overall situation which led to its adoption, on the one hand, and the general objectives which it is intended to achieve, on the other.
69 Since the General Court was correct to hold that the provisions relating to the export restrictions were of general application, the General Court did not err in law in holding, in paragraph 114 of the judgment under appeal, that, with respect to those provisions, the Council could justifiably maintain that the statement of reasons could be limited to indicating the overall situation which led to their adoption, on the one hand, and the general objectives which they were intended to achieve, on the other.
70 It follows from the foregoing that the first ground of appeal must be rejected. The second ground of appeal - Arguments of the parties
71 By the second ground of appeal, the appellants submit that General Court erred in law, in paragraphs 119 to 126 of the judgment under appeal, in holding that the Council had fulfilled its obligation to state reasons as provided for in Article 296 TFEU when it adopted the provisions relating to access to the capital market. That ground of appeal has two parts.
72 By the first part of this ground of appeal, the appellants claim that the General Court erred in law, in paragraph 121 of the judgment under appeal, in considering that the ‘actual and specific reasons’ why the Council held, in the exercise of its discretion, that Rosneft had to be subject to individual restrictive measures reflected in that instance the criteria laid down in the provisions on access to the capital market. According to the appellants, those criteria set out solely characteristics that apply to Rosneft, but do not explain why those characteristics were meaningful, in the light of the objectives of the CFSP pursued by the contested acts.
73 By the second part of this ground, the appellants submit that the Council failed, in any event, to fulfil its obligation to state reasons under Article 296 TFEU, in that the objective pursued by the capital market restrictions is not identified, in a clear and unequivocal fashion, in the contested acts. The appellants state that the first restrictive measures relating to the capital market, imposed on Rosneft by Regulation No 960/2014 and Decision 2014/659, did not refer to any specific objective of increasing costs for the Russian Federation, but said only that those restrictions had the more general objective of ‘putting pressure on the Russian government’. The appellants claim that, since that was the reason stated, Rosneft was unaware of the rationale for its being named in the list of entities subject to such measures. The fact that the Council’s specific reasoning was identified only in the judgment under appeal demonstrates that the Council failed to fulfil its obligation to state reasons.
74 The Council and the Commission contest the appellants’ arguments. - Findings of the Court
75 By their ground of appeal, the appellants do not call into question the finding made by the General Court in paragraph 115 of the judgment under appeal, namely that the restrictive measures laid down in the provisions on access to the capital market constituted, vis-à-vis the appellants, in so far as those measures concerned them, measures of individual application.
76 It must be recalled that the statement of reasons for an act of the Council which imposes a restrictive measure of individual application must identify the actual and specific reasons why the Council considers, in the exercise of its discretion, that such a measure must be adopted in respect of the person concerned (judgment of 15 November 2012, Council v Bamba , C‑417/11 P, EU:C:2012:718, paragraph 52).
77 The statement of reasons required by Article 296 TFEU must, however, be appropriate to the act at issue and the context in which it was adopted. The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons is sufficient must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question (judgment of 15 November 2012, Council v Bamba , C‑417/11 P, EU:C:2012:718, paragraph 53).
78 In particular, the reasons given for a decision adversely affecting a person are sufficient if it was adopted in circumstances known to the party concerned which enable him to understand the scope of the measure concerning him (judgment of 15 November 2012, Council v Bamba , C‑417/11 P, EU:C:2012:718, paragraph 54).
79 First, the Court must reject the appellants’ argument concerning paragraph 121 of the judgment under appeal, where the General Court considered that the Council could, in the exercise of its discretion, set out ‘actual and specific reasons’ why the appellants had to be subject to restrictive measures that reflected, in that instance, the criteria laid down in the provisions on access to the capital market.
80 In that regard, it must be recalled that Article 1(2)(b) of the contested decision and Article 5(2)(b) of the contested regulation prohibit, inter alia, all EU operators from carrying out certain financial transactions or from concluding an agreement with entities which meet certain criteria, namely entities established in Russia, which are publicly controlled, or with over 50% public ownership, which have estimated total assets of over 1 trillion Russian roubles (RUB), and at least 50% of whose estimated revenues come from the sale or transportation of crude oil or petroleum products as at 12 September 2014, and which are listed in Annex III to the contested decision or in Annex VI to the contested regulation. Article 1(2)(c) of the contested decision and Article 5(2)(c) of the contested regulation also prohibit those operators from carrying out those transactions with any legal person, entity or body established outside the European Union whose proprietary rights are directly or indirectly owned for more than 50% by an entity referred to in Article 1(2)(a) or (b) of the contested decision or Article 5(2)(a) or (b) of the contested regulation. Further, Rosneft was listed in those annexes.
81 It must also be recalled that the appellants do not dispute that they met those criteria.
82 It must, last, be recalled that the Court held, in paragraph 124 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), after finding that Decision 2014/512, as amended by Decision 2014/872, and the contested regulation indicated the overall situation that had led to their adoption and the general objectives that they were designed to achieve, that Rosneft, a major player in the Russian oil sector whose share capital was, on the date of adoption of Decision 2014/512, predominantly owned by the Russian State, could not reasonably have been unaware of the reasons why the Council has adopted measures targeted against it. The Court then held, in paragraph 125 of that judgment, that the Council had stated reasons for the adoption of the restrictive measures at issue that were sufficient.
83 The General Court therefore did not err in law in holding, in paragraph 121 of the judgment under appeal, that the Council’s finding that the appellants met the prescribed criteria governing the imposition of restrictive measures relating to access to the capital market enabled the appellants to understand, having regard to the overall situation that had led to the adoption of the contested acts and the objectives pursued by those acts, the reasons why the Council had adopted the restrictive measures with respect to them.
84 Second, the appellants’ argument that the objective of increasing the costs of the Russian Federation, pursued by the capital market restrictions, was not identified, in a clear and unequivocal fashion, in the contested acts, and was clarified in the judgment under appeal, must also be rejected.
85 Suffice it to observe that the Court itself stated, in paragraph 123 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), that it is apparent from recital 2 of the contested regulation that the declared objective of the contested acts was to increase the costs of the actions of the Russian Federation that were designed to undermine Ukraine’s territorial integrity, sovereignty and independence and to promote a peaceful settlement of the crisis.
86 It follows from the foregoing that the second ground of appeal, in both its parts, must be rejected. The third ground of appeal - Arguments of the parties
87 By the third ground of appeal, the appellants claim that the General Court erred in law, in paragraphs 157 and 163 of the judgment under appeal, in holding that there was a rational connection between the export restrictions and the objective of increasing the costs of the Russian Federation’s actions with respect to Ukraine and, consequently, in considering that they were appropriate, as required by the principle of proportionality.
88 In that regard, the appellants argue, first, that, if the export restrictions are of general application, the General Court could not consider that they were applicable to specific companies, namely Russian undertakings operating in the oil sector, on the basis notably of their estimated total assets of over RUB 1 trillion. The applicants state that there is a contradiction in holding that those measures are general while considering, in paragraph 157 of the judgment under appeal, that there was a rational connection between those restrictions, which targeted specific companies, including Rosneft, and the objective of increasing the costs of the Russian Federation’s actions with respect to Ukraine.
89 Second, the appellants maintain that the General Court erred, in paragraph 163 of the judgment under appeal, in considering that the rational connection between the export restrictions and the identified objective could not be called into question by the fact that the exploration and production projects in Russia (‘the non-conventional projects’) targeted by those restrictions did not generate immediate revenue for the Russian State. The fact that, according to the General Court, the future revenue of the Russian Federation will be undermined does not, the appellants claim, permit the conclusion that there is a rational connection between those restrictions and the objective of increasing the costs of the Russian Federation’s actions with respect to Ukraine. The General Court also erred in considering, in paragraph 163 of that judgment, that the Council could reasonably expect that the targeting of non-conventional oil projects would help to put pressure on the Russian Government. Putting pressure on the Russian Government does not correspond to the declared objective, identified in paragraph 157 of the judgment under appeal.
90 The Council and the Commission contest the appellants’ arguments. - Findings of the Court
91 As a preliminary point, it must be recalled that the Court has held that the EU legislature must be allowed a broad discretion in areas which involve political, economic and social choices on its part, and in which it is called upon to undertake complex assessments. The Court concluded that the legality of a measure adopted in those fields can be affected only if the measure is manifestly inappropriate having regard to the objective which the competent institution is seeking to pursue (judgment of 28 March 2017, Rosneft , C‑72/15, EU:C:2017:236, paragraph 146 and the case-law cited).
92 The imposition of export restrictions in a significant sector of the Russian economy, such as the Russian oil sector, plainly contributes to achieving the objective of increasing the costs of the Russian Federation’s actions to undermine Ukraine’s territorial integrity, sovereignty and independence, and of promoting a peaceful settlement of the crisis. That measure was therefore not manifestly inappropriate having regard to the objective which the competent institution was seeking to pursue.
93 Accordingly, the General Court was correct to hold, in paragraph 157 of the judgment under appeal, that there was indeed a rational connection between the export restrictions and the objective of the restrictive measures at issue.
94 The Court must also reject the appellants’ argument that there is a contradiction between paragraph 114 and paragraph 157 of the judgment under appeal, in that the General Court considered, in paragraph 114 of that judgment, that the export restrictions were of general application, whereas that court then held, in paragraph 157 of that judgment, that those restrictions targeted specific companies, including those which had features characteristic of Rosneft.
95 In paragraph 157 of the judgment under appeal, the General Court held, while giving a ruling on the overall restrictions laid down by the contested acts, that ‘there [was] in fact a rational connection between the targeting of undertakings in the Russian oil sector, on the basis notably of their estimated total assets of over RUB 1 trillion, in view of the importance of that sector for the Russian economy, and the objective of the restrictive measures in the present case, which is to increase the costs of the Russian Federation’s actions to undermine Ukraine’s territorial integrity, sovereignty and independence, and to promote a peaceful settlement of the crisis’.
96 While the General Court examined, in paragraphs 156 to 161 of the judgment under appeal, all of the restrictions at issue without distinction and not only the export restrictions, that court did however refer, in paragraph 157 of that judgment, in the clause that includes the word ‘notably’, to undertakings in the Russian oil sector whose estimated total assets were over RUB 1 trillion. That criterion of estimated total assets of over RUB 1 trillion derives solely from the provisions relating to the restrictions on access to the capital market and not from the provisions relative to export restrictions.
97 As regards the appellants’ argument that the General Court was wrong to consider, in paragraph 163 of the judgment under appeal, that there was a rational connection between the export restrictions and the objective of the restrictive measures, when the non-conventional projects targeted by some of the measures at issue did not generate immediate revenue for the Russian State, that argument must also be rejected. As the General Court stated in that paragraph, ‘by undermining investment and future revenues of entities active in the oil sector targeted by those measures, the Council could reasonably expect that this would help to put pressure on the Russian Government and to increase the costs of the Russian Federation’s actions to undermine Ukraine’s territorial integrity, sovereignty and independence’. Moreover, it is clear from the case-law cited in paragraph 91 of the present judgment that the legality of restrictive measures is not dependent on their being found to have immediate effects; all that is required is that they are not manifestly inappropriate in regard to the objective that the competent institution seeks to pursue.
98 As regards the appellants’ argument that the General Court also erred, in paragraph 163 of the judgment under appeal, in that ‘[putting] pressure on the Russian Government’ has no relation with the objective of increasing the costs of the Russian Federation, as set out in paragraph 157 of that judgment, suffice it to state that the objective of increasing the costs of the Russian Federation’s actions to undermine Ukraine’s territorial integrity, sovereignty and independence and of promoting a peaceful settlement of the crisis is connected with the objective of putting pressure on the Russian Government, and that, in any event, that latter objective is stated in recital 6 of Regulation No 960/2014.
99 It follows from the foregoing that the third ground of appeal must be rejected. The fourth, fifth and sixth grounds of appeal - Arguments of the parties
100 By the fourth, fifth and sixth grounds of appeal, the appellants claim that the General Court erred in law, in paragraphs 205, 206, 209 and 210 of the judgment under appeal, in holding that the export restrictions, and the restrictions on access to the capital market, were not in breach of their fundamental rights. The General Court failed to assess whether there was a fair balance between the protection of Ukraine’s territorial integrity, sovereignty and independence and the promotion of a peaceful settlement of the crisis in that country, the achievement of which was part of the wider objective of maintaining peace and international security, and the adverse consequences of the restrictions at issue on the fundamental rights of the appellants. Consequently, the General Court failed to carry out a full review. If the General Court had weighed those considerations, that would have demonstrated that the restrictions at issue were contrary to the appellants’ fundamental rights.
101 As regards the export restrictions, the appellants claim, in addition, that there was a breach of their fundamental rights in that there was no rational connection between those restrictions and the objective of increasing the costs of the actions of the Russian Federation in Ukraine. Even if it were to be the case that, due to the wide discretion accorded to the Council, such a connection could not be excluded, the existence of such a connection would not be sufficient ground to hold that those restrictions were proportionate.
102 As regards, in particular, Article 11 of the contested regulation, which provides for restrictions on legal claims, the appellants add that the General Court erred in law in determining that the contested restrictions on legal claims were not in breach of their fundamental right to property. The appellants claim that, in essence, the General Court took the position that any restriction designed to ensure the effectiveness of a sanctions measure is permissible under EU law. The appellants had, however, set out before the General Court extensive arguments as to why the scope of the contested restrictions was excessively broad. The General Court addressed none of these arguments and incorrectly held that proportionality is not a relevant legal principle when a measure is capable in theory of ensuring the effectiveness of sanctions.
103 As regards the restrictions on access to the capital market, the appellants again argue that those restrictions were not shown to have any connection with increasing the cost of the actions of the Russian Federation in Ukraine, but are designed to cut off Rosneft’s financing for other unclear and unspecified reasons, linked to putting pressure on the Russian Government.
104 The Council and the Commission contest the appellants’ arguments. - Findings of the Court
105 In paragraph 204 of the judgment under appeal, the General Court, referring to paragraph 146 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), stated that, in so far as the appellants were challenging the proportionality of the general rules on the basis of which it was decided that Rosneft should be listed in the annexes to the contested acts, the Court, with regard to the judicial review of compliance with the principle of proportionality, had, first, ‘held that the EU legislature must be allowed a broad discretion in areas which involve political, economic and social choices in its part, and in which it is called upon to undertake complex assessments’ and, second, ‘concluded that the legality of a measure adopted in those areas could be affected only if the measure was manifestly inappropriate having regard to the objective which the competent institution was seeking to pursue’.
106 In paragraph 205 of the judgment under appeal, referring to paragraph 147 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), the General Court added that, contrary to what was claimed by the appellants, there was a reasonable relationship between the content of the contested acts and the objective pursued by those acts. According to the General Court, ‘in so far as that objective [was], inter alia, to increase the costs to be borne by the Russian Federation for its actions to undermine Ukraine’s territorial integrity, sovereignty and independence, the approach of targeting a major player in the oil sector, which is moreover predominantly owned by the Russian State, [was] consistent with that objective and [could not], in any event, be considered to be manifestly inappropriate with respect to the objective pursued’.
107 In paragraph 206 of the judgment under appeal, the General Court stated that, in so far as the applicants also challenged the proportionality of Article 11 of the contested regulation, ‘the provision precluding the satisfaction of claims laid down in that article is intended to prevent an entity targeted by the restrictive measures at issue from being able to procure performance of a prohibited transaction, contract or service or from obtaining a remedy under civil law for non-performance of such transactions, contracts or services’. The General Court added that ‘such a provision thus ensured the effectiveness of the restrictive measures at issue, by reflecting in private law the effects of measures that [had] been properly adopted by the European Union, for so long as those measures [were] applicable’ and held that, in that sense, ‘Article 11 of the contested regulation [had to be] considered a proportionate means of achieving the objective of the contested acts’.
108 As regards the fundamental rights relied on by the appellants, namely the freedom to conduct a business and the right to property, the General Court, after noting, inter alia, that those rights were not absolute, held, in paragraph 209 of the judgment under appeal, relying on paragraphs 149 and 150 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), that ‘the importance of the objectives pursued by the contested acts, namely the protection of Ukraine’s territorial integrity, sovereignty and independence and the promotion of a peaceful settlement of the crisis in that country, the achievement of which was part of the wider objective of maintaining peace and international security, in accordance with the objectives of the Union’s external action set out in Article 21 TEU, [was] such as to justify the possibility that, for certain operators, which are in no way responsible for the situation which led to the adoption of the sanctions, the consequences may be negative, even significantly so’.
109 The General Court held, in paragraph 210 of the judgment under appeal, that, ‘in those circumstances, and having regard, in particular, to the fact that the restrictive measures adopted by the Council in reaction to the crisis in Ukraine have become progressively more severe, interference with [the appellants’] freedom to conduct a business and their right of property cannot be considered to be disproportionate’.
110 First, contrary to what is claimed by the appellants, it is clear from the paragraphs of the judgment under appeal cited above that the General Court weighed the objective pursued by the contested acts, which was, inter alia, to increase the costs of the actions of the Russian Federation designed to undermine Ukraine’s territorial integrity, sovereignty and independence, against the adverse effect on the fundamental rights of the appellants. Having held that the Council’s approach of targeting a major player in the oil sector was consistent with that objective, the General Court held that, in view of the importance of the objective and the gradual development of the restrictive measures, the interference in the appellants’ freedom to conduct a business and right to property could not be regarded as being disproportionate.
111 Second, the Court must reject, for the same reasons as those set out in paragraphs 91 to 93 of the present judgment, the appellants’ argument that there was no rational connection between the export restrictions and the objective of increasing the costs of the actions of the Russian Federation in Ukraine.
112 Further, contrary to what is claimed by the appellants, the General Court did not confine itself to identifying a connection between the export restrictions and the objective of increasing the costs of the actions of the Russian Federation in Ukraine. As has been stated above in paragraph 110 of the present judgment, the General Court also weighed the consequences of those measures on the appellants’ fundamental rights against that objective.
113 Third, as regards the appellants’ argument in relation to Article 11 of the contested regulation, which provides for restrictions on legal claims, it must be observed that, in paragraph 206 of the judgment under appeal, the content of which was quoted in paragraph 107 of the present judgment, the General Court, having examined the scope and objective of the restrictions on legal claims laid down in Article 11 of the contested regulation, held that, since those restrictions made it possible to ensure the effectiveness of the restrictive measures at issue, validly adopted by the European Union, those restrictions were proportionate.
114 Accordingly, contrary to what is claimed by the appellants, the General Court examined whether that Article 11 constituted a proportionate means of achieving the objective set by the contested acts.
115 As regards the appellants’ argument that General Court failed to address the arguments raised before it, in paragraphs 144 to 151 of the initiating application, that the contested restrictions on legal claims were excessively broad in scope, it must be recalled that, in accordance with settled case-law, the obligation to state reasons does not require the General Court to provide an account which follows exhaustively and one-by-one all the arguments put forward by the parties to the case; the General Court’s reasoning may therefore be implicit on condition that it enables the persons concerned to know why it has not upheld their arguments and provides the Court of Justice with sufficient material for it to exercise its power of review (judgment of 26 March 2020, Larko v Commission , C‑244/18 P, EU:C:2020:238, paragraph 43 and the case-law cited).
116 In paragraph 199 of the judgment under appeal, the General Court summarised the arguments set out in paragraphs 144 to 151 of the initiating application, noting that the appellants were claiming that the provisions of the contested regulation on export restrictions and Article 11 of that regulation, read together, amounted to a far-reaching interference with their right to property, since those measures applied wherever acquired rights relating to the supply of relevant goods or ancillary services were subject to the requirement of prior authorisation.
117 It must be stated that, in paragraph 206 of the judgment under appeal, the General Court examined the scope and objective of the restrictive measures laid down in Article 11 of the contested regulation and held that those measures served to ensure the effectiveness of the other restrictive measures at issue. The General Court concluded that that article had to be regarded as a proportionate means of achieving the objective set by the contested acts. Further, in paragraphs 209 and 210 of that judgment, the General Court weighed the consequences of the restrictive measures at issue for the appellants’ fundamental rights, including their right to property, against the objectives of those measures, and then held that the interference, in particular in the appellants’ right to property, could not be regarded as disproportionate. In so deciding, the General Court responded to the appellants’ arguments, as set out in paragraphs 144 to 151 of the initiating application.
118 That statement of reasons is sufficient in that it allowed the appellants to know why the General Court had not upheld their arguments and enabled the Court to exercise its power of review.
119 Last, as regards the appellants’ argument that the restrictions on access to the capital market had not been shown to have any connection with increasing the costs of the actions of the Russian Federation in Ukraine, it must be recalled that, under the case-law cited in paragraph 91 of the present judgment, the legality of such a restrictive measure can be affected only if the measure is manifestly inappropriate having regard to the objective which the competent institution is seeking to pursue.
120 The imposition of restrictions on access to the capital market in an important sector of the Russian economy, such as the oil sector, like the imposition of export restrictions described in paragraph 92 of the present judgment, clearly contributes to achieving the objective of increasing the costs of the actions of the Russian Federation designed to undermine Ukraine’s territorial integrity, sovereignty and independence and of promoting a peaceful settlement of the crisis.
121 The General Court therefore did not err in holding, in paragraph 157 of the judgment under appeal, that a rational connection did exist between the restrictions on access to the capital market and the objective of the restrictive measures at issue.
122 It follows from the foregoing that the fourth, fifth and sixth grounds of appeal must therefore be rejected. The seventh ground of appeal - Arguments of the parties
123 By the seventh ground of appeal, the appellants claim that the General Court erred in law, in paragraphs 178, 179 and 182 of the judgment under appeal, in holding that any breach of the EU-Russia Partnership Agreement and of GATT, as incorporated into the EU-Russia Partnership Agreement, could be justified by the security exceptions, provided under those agreements.
124 In that regard, the appellants argue, first, that Article 99 of the EU-Russia Partnership Agreement and Article XXI of GATT are provisions of international law, and not provisions of EU law. While as a matter of EU law, the Council in principle has broad discretion to take the measures that it considers necessary, that is, however, a feature of the internal organisation of the European Union and cannot determine the correct interpretation of an international treaty with third countries. The General Court therefore erred in referring, with respect to those two provisions, to the broad discretion enjoyed by the Council.
125 The appellants claim, second, that the General Court did not set out the reasons why the restrictions at issue should or could be considered necessary.
126 The Council and the Commission contest the appellants’ arguments. - Findings of the Court
127 In the first place, as the General Court stated in paragraph 178 of the judgment under appeal, the issue of whether the restrictive measures at issue are compatible with the EU-Russia Partnership Agreement has already been determined by the Court in the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236).
128 In paragraphs 110 to 117 of that judgment, quoted in paragraph 178 of the judgment under appeal, the Court held as follows: ‘110 … it suffices to state that, even if the restrictive measures at issue in the main proceedings were not compatible with certain provisions [of the EU-Russia Partnership Agreement], Article 99 of that agreement permits their adoption. 111 Under Article 99(1)(d) of the EU-Russia Partnership Agreement, nothing in that agreement is to prevent a party from taking measures that it considers necessary for the protection of its essential security interests, particularly in time of war or serious international tension constituting a threat of war or in order to carry out obligations it has accepted for the purpose of maintaining peace and international security. 112 Further, the wording of that provision does not require that the “war” or “serious international tension constituting a threat of war” refer to a war directly affecting the territory of the European Union. Accordingly, events which take place in a country bordering the European Union, such as those which have occurred in Ukraine and which have given rise to the restrictive measures at issue in the main proceedings, are capable of justifying measures designed to protect essential European Union security interests and to maintain peace and international security, in accordance with the specified objective, under the first subparagraph of Article 21(1) and Article 21(2)(c) TEU, of the Union’s external action, with due regard to the principles and purposes of the Charter of the United Nations. 113 As regards the question whether the adoption of the restrictive measures at issue in the main proceedings was necessary for the protection of essential European Union security interests and the maintenance of peace and international security, it must be borne in mind that the Council has a broad discretion in areas which involve the making by that institution of political, economic and social choices, and in which it is called upon to undertake complex assessments (judgment of 1 March 2016, National Iranian Oil Company v Council , C‑440/14 P, EU:C:2016:128, paragraph 77 and the case- law cited). 114 As stated by the Advocate General in point 150 of his Opinion, at the time when the restrictive measures at issue in the main proceedings were adopted, the Council stated, in the preambles of the [acts at issue], that the Heads of State or Government of the European Union condemned the unprovoked infringement of Ukrainian sovereignty and territorial integrity by the Russian Federation, that the Council urged the Russian Federation actively to use its influence over the illegally armed groups in order, inter alia, to permit full, immediate, safe and secure access to the site of the downing of the Malaysia Airlines flight MH17 in Donetsk (Ukraine), and that the Union had previously adopted measures in response to the illegal annexation of the Crimea and Sevastopol (Ukraine). In view of those factors, the Council concluded, in recital 8 of Decision 2014/512 [as amended by Decision 2014/872], that the situation remained grave and that it was appropriate to adopt restrictive measures in response to the actions of the Russian Federation destabilising the situation in Ukraine. 115 Further, as is stated in recital 2 of [the contested regulation], it is apparent from those statements that the aim of the restrictive measures prescribed by the [acts at issue] was to promote a peaceful settlement of the crisis in Ukraine. That objective is consistent with the objective of maintaining peace and international security, in accordance with the objectives of the Union’s external action set out in Article 21 TEU. 116 In those circumstances, taking into consideration the broad discretion enjoyed by the Council in this area, that institution could take the view that the adoption of the restrictive measures at issue in the main proceedings was necessary for the protection of essential European Union security interests and for the maintenance of peace and international security, within the meaning of Article 99 of the EU-Russia Partnership Agreement. 117 Consequently, an examination of the [acts at issue] in the light of that agreement has disclosed nothing capable of affecting their validity.’
129 In paragraph 179 of the judgment under appeal, the General Court held that the appellants had put forward before it no new argument that might call into question the finding made by the Court as to the compatibility of the restrictive measures laid down by the contested acts with the EU-Russia Partnership Agreement.
130 In the second place, as regards the compatibility of the restrictions imposed by the contested acts with GATT, the General Court stated, in paragraphs 180 and 181 of the judgment under appeal, that, even if GATT were directly applicable and could usefully be relied upon by the appellants in this instance, that agreement also contains, in Article XXI thereof, in the same way as Article 99 of the EU-Russia Partnership Agreement, a provision relating to ‘security exceptions’.
131 Consequently the General Court held, in paragraph 182 of the judgment under appeal, that, in the light of the broad discretion that the Council has in this area, that the Council was entitled to consider that the actions of the Russian Federation undermining or threatening Ukraine’s territorial integrity, sovereignty and independence could amount to an ‘emergency in international relations’ and that the restrictive measures at issue were ‘necessary for the protection of [the] essential security interests [of the Member States of the European Union]’, within the meaning of Article XXI of GATT.
132 The appellants’ claim that the General Court, in so ruling, committed an error in law cannot be upheld.
133 First, as regards the argument that the Council does not have, with regard to the rules of international law, the broad discretion that it enjoys under EU law to take the restrictive measures that it deems to be necessary, on the ground that the nature and extent of that discretion are specific to the internal organisation of the European Union and that that discretion cannot, in fact, inform the interpretation of an international treaty, it must be observed, in the first place, that, under Article 216(2) TFEU, international agreements concluded by the Union are an integral part of EU law and are binding on the institutions and the Member States.
134 In the second place, it is clear both from the wording of Article 99 of the EU-Russia Partnership Agreement and that of Article XXI of GATT, that nothing in those agreements prevents any party from taking the action that it considers necessary for the protection of its essential security interests. It is therefore for each party to determine the measures that it considers necessary for the protection of its essential security interests with due regard to its own internal rules. Consequently, the General Court did not err in law in holding that the Council, as an institution of the European Union, which was a party to those agreements, could exercise its broad discretion in assessing whether it was necessary to adopt certain measures.
135 Second, the General Court undertook an examination of the plea in law that there was a breach of the international obligations of the European Union under the EU-Russia Partnership Agreement in the light of the criteria established by the Court in paragraphs 113 to 116 of the judgment of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236), from which it is plain that the Council could consider that the adoption of the restrictive measures at issue was necessary for the protection of the essential security interests of the European Union and for the maintenance of peace and international security. Having set out those criteria in paragraph 178 of the judgment under appeal, the General Court correctly applied those criteria in paragraph 179 of that judgment, and held that the appellants had put forward before it no new argument that might call into question the findings made by the Court.
136 Consequently, the appellants cannot maintain that the General Court failed to set out the reasons why the restrictive measures at issue should or could have been considered necessary.
137 It follows from the foregoing that the seventh ground of appeal must be rejected.
138 Since all the grounds of appeal relied on have been rejected, the appeal must be dismissed. Costs
139 In accordance with Article 184(2) of the Rules of Procedure of the Court, where the appeal is unfounded, the Court is to make a decision as to costs.
140 Under Article 138(1) of those rules, which applies to appeal proceedings by virtue of Article 184(1) thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings.
141 Since the Council applied for costs and the appellants have been unsuccessful, the latter must be ordered to pay the costs of the Council and to bear their own costs.
142 In accordance with Article 184(4) of the Rules of Procedure, the Commission must bear its own costs. On those grounds, the Court (Seventh Chamber) hereby: 1. Dismisses the appeal; 2. Orders Rosneft Oil Company PAO, RN-Shelf-Arctic OOO, RN-Shelf-Far East AO, RN-Exploration OOO and Tagulskoe OOO to bear their own costs and to pay those incurred by the Council of the European Union; 3. Orders the European Commission to bear its own costs. Xuereb von Danwitz Kumin Delivered in open court in Luxembourg on 17 September 2020. A. Calot Escobar P. G. Xuereb Registrar President of the Seventh Chamber * Language of the case: English.