1. Mr Ahmed Abdelaziz Ezz and Others have appealed against the judgment of the General Court of the European Union (Third Chamber) of 27 February 2014 in Ezz and Others v Council (T‑256/11, EU:T:2014:93, ‘the judgment under appeal’), by which the General Court dismissed their action for annulment, first, of Council Decision 2011/172/CFSP of 21 March 2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt (OJ 2011 L 76, p. 63) and, secondly, of Council Regulation (EU) No 270/2011 of 21 March 2011 concerning restrictive measures directed against certain persons, entities and bodies in view of the situation in Egypt (OJ 2011 L 76, p. 4), in so far as those acts concern the appellants. Legal context and background to the dispute The United Nations Convention against Corruption
2. The United Nations Convention against Corruption (‘the Convention’) was adopted by Resolution 58/4 of 31 October 2003 of the General Assembly of the United Nations. It entered into force on 14 December 2005. It has been ratified by all the Member States and was approved by the European Union by Council Decision 2008/801/EC of 25 September 2008 (OJ 2008 L 287, p. 1).
3. Article 2 of the Convention states: ‘For the purposes of this Convention: … (f) “freezing” or “seizure” shall mean temporarily prohibiting the transfer, conversion, disposition or movement of property or temporarily assuming custody or control of property on the basis of an order issued by a court or other competent authority; (g) “confiscation”, which includes forfeiture where applicable, shall mean the permanent deprivation of property by order of a court or other competent authority; …’
4. Chapter III of the Convention, which contains Articles 15 to 42, relates to criminalisation and law enforcement. Articles 15 to 27 of that chapter list a large variety of acts of corruption which States must establish as criminal offences. Since the objective of the Convention is to enable an increasing number of acts of corruption to be criminalised in view of the threats to the stability and security of societies to which they give rise, the Convention covers not only the offer of undue benefits to a person or the embezzlement of public funds, but also trading in influence and the concealment or laundering of the proceeds of corruption.
5. Article 31(1) and (2) of the Convention is worded as follows: ‘1. Each State Party shall take, to the greatest extent possible within its domestic legal system, such measures as may be necessary to enable confiscation of: (a) Proceeds of crime derived from offences established in accordance with this Convention or property the value of which corresponds to that of such proceeds; (b) Property, equipment or other instrumentalities used in or destined for use in offences established in accordance with this Convention. 2. Each State Party shall take such measures as may be necessary to enable the identification, tracing, freezing or seizure of any item referred to in paragraph 1 of this article for the purpose of eventual confiscation.’
6. Article 55(2) of the Convention is worded as follows: ‘Following a request made by another State Party having jurisdiction over an offence established in accordance with this Convention, the requested State Party shall take measures to identify, trace and freeze or seize proceeds of crime, property, equipment or other instrumentalities referred to in Article 31(1) of this Convention for the purpose of eventual confiscation to be ordered either by the requesting State Party or, pursuant to a request under paragraph 1 of this Article, by the requested State Party.’ EU law
7. In the wake of the political events which took place in Egypt in and after January 2011, the Council of the European Union adopted Decision 2011/172 on 21 March 2011, citing Article 29 TEU.
8. Recitals 1 and 2 in the preamble to Decision 2011/172, in its original version, state: ‘(1) On 21 February 2011, the European Union declared its readiness to support the peaceful and orderly transition to a civilian and democratic government in Egypt based on the rule of law, with full respect for human rights and fundamental freedoms and to support efforts to create an economy which enhances social cohesion and promotes growth. (2) In this context, restrictive measures should be imposed against persons having been identified as responsible for misappropriation of Egyptian State funds and who are thus depriving the Egyptian people of the benefits of the sustainable development of their economy and society and undermining the development of democracy in the country.’
9. Under Article 1(1) of Decision 2011/172, in its original version: ‘All funds and economic resources belonging to, owned, held or controlled by persons having been identified as responsible for misappropriation of Egyptian State funds, and natural or legal persons, entities or bodies associated with them, as listed in the Annex, shall be frozen.’
10. While the expression ‘persons having been identified as responsible’ was used in the English-language version of recital 2 and Article 1(1), the expression used in the French-language version of those provisions was ‘personnes reconnues comme responsables’ (persons having been found/recognised as responsible).
11. On 11 July 2014, that is after delivery of the judgment under appeal, a corrigendum to that decision was published in the Official Journal of the European Union in respect of the Bulgarian, Spanish, Czech, Estonian, French, Hungarian and Dutch-language versions (OJ 2014 L 203, p. 113). According to that corrigendum, those provisions must be read as referring to persons ‘having been identified’ as responsible and not to persons ‘having been recognised’ as responsible.
12. Decision 2011/172 includes, as an annex, a ‘[l]ist of natural and legal persons, entities and bodies referred to in Article 1’. That list contains three categories of information. The first column contains the ‘[n]ame (and any aliases)’ of the legal subjects concerned; the second contains ‘[i]dentifying information’ in respect of those subjects; and a third column states the ‘[g]rounds for designation’.
13. Mr Ahmed Abdelaziz Ezz is listed in seventh place. The second column contains the following information: ‘Former Member of the Parliament. Date of birth: 12.01.1959. Male’. The grounds for designation set out in the third column, which are the same for all 19 persons included on the list, are as follows: ‘[p]erson subject to judicial proceedings by the Egyptian authorities in respect of the misappropriation of State Funds on the basis of the United Nations Convention against corruption’.
14. Ms Abla Mohamed Fawzi Ali Ahmed is listed in eighth place. The second column contains the following information: ‘Spouse of Mr Ahmed Abdelaziz Ezz. Date of birth: 31.01.1963. Female’.
15. Ms Khadiga Ahmed Ahmed Kamel Yassin is listed in ninth place. The second column contains the following information: ‘Spouse of Mr Ahmed Abdelaziz Ezz. Date of birth: 25.05.1959. Female’.
16. Ms Shahinaz Abdel Aziz Abdel Wahab Al Naggar is listed in tenth place. The second column contains the following information: ‘Spouse of Mr Ahmed Abdelaziz Ezz. Date of birth: 09.10.1969. Female’.
17. Citing Article 215(2) TFEU and Decision 2011/172, the Council adopted Regulation No 270/2011. Article 2(1) and (2) of that regulation reproduces, in essence, the provisions of Article 1(1) and (2) of Decision 2011/172. The regulation includes an Annex I, which is identical to the Annex to Decision 2011/172. As is apparent from recital 2 in the preamble to the regulation, since the measures imposed by Decision 2011/172 ‘[fell] within the scope of the Treaty on the Functioning of the European Union …, regulatory action at the level of the Union [was] necessary in order to implement them’ and justified the adoption of that act.
18. Regulation No 270/2011 was not the subject of a corrigendum similar to that issued in relation to Decision 2011/172. Procedure before the General Court and the judgment under appeal
19. By application lodged at the General Court Registry on 20 May 2011, the appellants brought an action for annulment of Decision 2011/172 and Regulation No 270/2011, in so far as those acts concern them.
20. They raised eight pleas in law in support of their action. Their fourth plea in law related to errors of fact and in the legal characterisation of the facts vitiating the grounds for their inclusion in the lists annexed to Decision 2011/172 and Regulation No 270/2011. They maintained in that respect that they were not subject to any judicial proceedings in Egypt.
21. The General Court found as follows in paragraphs 123 to 133 and 137 of the judgment under appeal: ‘123 By letter of 7 June 2011, the Council explained to the applicants’ lawyers that it had received a “letter dated 13 February 2011 from the Egyptian Ministry of Foreign Affairs with a request by the Egyptian Prosecutor General to freeze the assets of certain former Ministers and officials”, which included the first applicant. A copy of a document dated 13 February 2011 on the headed notepaper of the Office of the Egyptian Minister of Foreign Affairs was enclosed with that letter from the Council. In that unsigned document, reference was made to a request from the Egyptian Prosecutor General to freeze the assets of “former [Egyptian] Ministers, officials and nationals”. The first applicant was one of the persons the subject of that request, but not the second, third and fourth applicants. … 125 By letter of 29 July 2011, the Council replied to the letters from the applicants’ lawyers dated 13 May, 9 June and 15 July 2011. In that reply, no reference is made to possible court proceedings against the second, third and fourth applicants. Only the following is stated: “[They] appear on the list of persons subject to the above-mentioned request for judicial assistance by the Egyptian authorities (they appear under Nos. 2, 3 and 4 on the enclosed list). The request states that orders have been issued by the Egyptian Prosecutor General for the seizure of the assets of all the persons on the list, and that this order was endorsed by the criminal court.” 126 The Council’s letter of 29 July 2011 included in annex a note dated 24 February 2011 (Ref NV93/11/ms), by which the Embassy of the Arab Republic of Egypt in Brussels (Belgium) requested the High Representative of the Union for Foreign Affairs and Security Policy to transmit to the “competent [judicial] authorities” a request for judicial assistance from the Office of the Egyptian Prosecutor General. 127 Three documents were included in annex to that note. 128 The first document was the undated and unsigned text of the request for judicial assistance. That request, drafted in English, sought to “freeze, confiscate and return assets of some former ministers and officials”. It referred to “the investigation carried out by the Egyptian Prosecution General in the [Cases Nos] 162 and 234 for the year 2010 ...; 34, 36, 38, 39, 55 and 70 for the year 2011 ... and [in Case No] 137/2011 ... regarding crimes of corruption, usurping of public assets, and money laundering crimes committed by former ministers and officials” and listed fifteen individuals, including the four applicants. The request went on to state, first, that the Egyptian Prosecutor General had decided to seize the assets of the persons thus listed and, secondly, that that seizure had been “endorsed by the criminal court”. 129 The second document annexed to the note of 24 February 2011 was a “list of former officials, [their] wives and children” in which the second, third and fourth applicants appeared second, third and fourth, respectively. 130 The third document annexed to the note of 24 February 2011 was presented as a summary of the allegations against the first applicant in “[Case No] 38 for the year 2011”, a case referred to in the request for judicial assistance referred to in paragraph 128 above. That document was undated, and was not on headed notepaper or signed. However, as with the note of 24 February 2011 and all the other documents annexed thereto, it bore the stamp of the Embassy of the Arab Republic of Egypt in Brussels. 131 In short, none of the above-mentioned documents suggests that the second, third and fourth applicants have been prosecuted in Egypt for the misappropriation of State funds. 132 On the other hand, the request for judicial assistance referred to in paragraph 128 above shows, unequivocally, that, on 24 February 2011, less than one month before Decision 2011/172 and Regulation No 270/2011 were adopted, all the applicants were the subject of an order of the Egyptian Prosecutor General seeking to seize their assets, which had been endorsed by a criminal court and was linked to investigations concerning misappropriation of State funds. 133 The applicants have not moreover produced any evidence to cast doubt on the accuracy of the information entered on that request for judicial assistance. On the contrary, a decision of the Egyptian courts, a translation of which was lodged at the Court Registry on 5 March 2013, confirms that the second applicant still had her assets frozen on 30 January 2013. In addition, the applicants did not dispute, at the hearing, that the above-mentioned order for seizure existed. … 137 … it is clear from the document referred to in paragraph 130 above that, in “[Case No] 38 for the year 2011”, the first applicant was “accused” first of “usurping the assets” of a “public sector company with State-owned shares” and, secondly, of “committing crimes of profiteering and [intentionally] harming public assets, as well as usurping and … facilitating the usurpation of [such] assets”.’
22. Since the General Court did not uphold any of the pleas, it dismissed the action in its entirety. Forms of order sought
23. The appellants claim that the Court should: - set aside the judgment under appeal; - annul Decision 2011/172 and Regulation No 270/2011 in so far as those acts apply to them; - order the Council to pay the costs of the appeal and of the proceedings before the General Court; and - take any other measures that the Court considers appropriate.
24. The Council contends that the Court should: - dismiss the appeal; and - order the appellants to pay the costs.
25. The European Commission contends that the Court should: - dismiss the appeal; and - order the appellants to pay the costs of the appeal. Appeal
26. The appellants put forward six grounds of appeal. The first ground of appeal
27. By their first ground of appeal, the appellants argue that the General Court erred in law in holding that Decision 2011/172 was lawfully adopted on the basis of Article 29 TEU. That plea relates to paragraphs 44 to 47 of the judgment under appeal. The judgment under appeal
28. In order to determine the meaning of Article 29 TEU, the General Court examined Articles 21 TEU, 23 TEU to 25 TEU and 28 TEU. It concluded the following in paragraph 41 of the judgment under appeal: ‘The combined effect of those provisions is that decisions which (i) come within the framework of the common foreign and security policy (CFSP), as defined in Article 24(1) TEU, (ii) relate to “a particular matter of a geographical or thematic nature” and (iii) are not in the nature of “operational action” within the meaning of Article 28 TEU constitute “approaches of the Union” within the meaning of Article 29 TEU.’
29. In paragraphs 44 to 46 of that judgment, the General Court found that the three criteria were met in the present case. It concluded in paragraph 47 of its judgment that Article 1 of Decision 2011/172 could be lawfully adopted on the basis of Article 29 TEU. Arguments of the parties
30. The appellants submit that the conditions for adopting decisions on the basis of Article 29 TEU were not fulfilled in the present case. The grounds for entry on the list annexed to Decision 2011/172 did not come within the principles and objectives of the CFSP set out in Article 21 TEU. At no point had the Egyptian authorities suggested in the letters relied on by the Council that the appellants’ alleged actions undermined ‘democracy’ in Egypt or ‘the sustainable economic [or] social … development’ of Egypt.
31. The conduct of which the first appellant is accused, namely fraud against a company’s shareholders, does not justify EU action at international level under the CFSP. Furthermore, there is no substantive allegation against the spouses of Mr Ezz. To regard fraud committed in a third country as engaging the foreign and security policy of the European Union would have the effect of significantly extending the scope of that policy, to the detriment of the competences of the Member States in relation to mutual legal assistance.
32. In addition, the Egyptian authorities had not requested that the European Union adopt a decision under Article 29 TEU, but had requested mutual judicial assistance, which is a matter for the national judicial authorities.
33. Lastly, the request by the Egyptian authorities related to the preservation of funds which could be used to satisfy a judgment delivered by a national judicial authority against Mr Ezz and to enable the sums in question to be ‘repatriated’, for which there is no jurisdiction under the CFSP. In finding that one of the appellants was charged with activities considered by the Egyptian authorities to threaten democratic government in the Arab Republic of Egypt or sustainable economic or social development in that country, the General Court distorted the evidence before it.
34. The Council states that the first plea amalgamates two complaints, the first regarding the lack of a legal basis for Decision 2011/172 and the second regarding the appellants’ non-fulfilment of the criteria for their inclusion in the scope of Decision 2011/172 and Regulation No 270/2011. It observes that the General Court responded to their plea alleging the lack of a legal basis in paragraphs 44 to 47 of the judgment under appeal.
35. In the Council’s view, the appellants’ interpretation of the objectives of Decision 2011/172 is incorrect when there is nothing in that decision to suggest that the reason for the appellants’ inclusion in the list annexed to that decision of persons whose funds and economic resources were to be frozen was fraud committed in a third country, or that the aim of that decision is to provide mutual legal assistance.
36. The Council argues that Decision 2011/172 is an autonomous measure which was adopted in pursuit of the aims of the CFSP and in exercise of the discretionary powers available to the Council in this respect, rather than in response to the Egyptian authorities’ request. Accordingly, when examining the plea of illegality raised against Article 1 of Decision 2011/172, the General Court did not address the alleged actions of the appellants or the content of note verbale NV93/11/ms, nor did it need to do so.
37. The Commission contends that, in so far as it concerns the lack of a legal basis for Decision 2011/172, the first ground of appeal is inadmissible, since it was not relied on in the application for annulment lodged at first instance. It is also new in substance, in that the criterion based on responsibility for the misappropriation of State funds on the basis of which the appellants’ funds were frozen is incompatible with Article 21 TEU, since the measure does not pursue any of the objectives set out in paragraphs 1 or 2 of that article. Furthermore, the appeal does not discuss at all the reasoning of the General Court in paragraphs 34 to 54 of the judgment under appeal on the meaning and scope of Article 29 TEU. This ground of appeal should therefore be declared inadmissible.
38. In the alternative, the Commission maintains that the General Court did not err in law when it held that the conditions for the application of Article 29 TEU were fulfilled. It submits that, contrary to what the appellants suggest, this is not a matter of treating a foreign fraud case as engaging the foreign and security policy of the European Union, but of responding to requests of a newly established government in a third country to preserve the public funds of that country in order to ensure their future recovery and use for the benefit of the Egyptian people.
39. The Commission emphasises, moreover, that the fact that a request by the Egyptian authorities was expressly directed to the judicial authorities of the European Union has no bearing on whether Article 29 TEU is an appropriate legal basis for the adoption of Decision 2011/172 on restrictive measures. Those restrictive measures are autonomous measures, which the Council is entitled to take, even in the absence of any request from the third country concerned.
40. Lastly, the reference to the repatriation of funds is irrelevant in the present case, since that issue is outside the scope of Decision 2011/172 and Regulation No 270/2011. Findings of the Court
41. By their first ground of appeal, the appellants maintain that the General Court erred in law in holding that Decision 2011/172 was lawfully adopted on the basis of Article 29 TEU.
42. Review of the legal basis of an act enables the powers of the author of the act to be verified (see, to that effect, judgment in Germany v Parliament and Council , C‑376/98, EU:C:2000:544, paragraph 83) and the procedure for the adoption of that directive to be checked as to whether it was vitiated by any irregularity (judgment in ABNA and Others , C‑453/03, C‑11/04, C‑12/04 and C‑194/04, EU:C:2005:741, paragraph 53). According to settled case-law, the choice of legal basis for an EU measure must rest on objective factors amenable to judicial review, including the purpose and content of that measure (see, in particular, judgment in Parliament v Council , C‑130/10, EU:C:2012:472, paragraph 42).
43. In paragraphs 44 to 46 of the judgment under appeal, the General Court examined the purpose and content of Decision 2011/172 and concluded that it could be lawfully adopted on the basis of Article 29 TEU. In particular, in paragraph 44 of the judgment under appeal, the General Court held that Decision 2011/172 forms part of a policy of supporting the new Egyptian authorities, intended to promote both the economic and political stability of Egypt and, in particular, to assist the authorities of that country in their fight against the misappropriation of State funds, and that, accordingly, that decision is fully based on the CFSP and satisfies the objectives referred to in Article 21(2)(b) and (d) TEU.
44. In that respect, the appellants have not developed any argument to demonstrate that the General Court erred in law in the reasoning set out in the preceding paragraph, but merely assert generally that the Egyptian authorities did not declare in the letters produced by the Council that the appellants’ alleged actions undermined democracy or the sustainable economic or social development of Egypt, within the meaning of Article 21(2)(b) and (d) TEU. Consequently, the appellants’ argument cannot be accepted.
45. In addition, the appellants dispute the merits of Decision 2011/172 in the light of Article 21 TEU.
46. However, in view of the broad scope of the aims and objectives of the CFSP, as expressed in Articles 3(5) TEU and 21 TEU, and specific provisions relating to the CFSP, in particular Articles 23 TEU and 24 TEU, that argument cannot call into question the General Court’s assessment regarding the legal basis of Decision 2011/172.
47. As regards the complaint concerning the distortion of the evidence, it must be noted that the appellants have not established which part of the section of the judgment under appeal challenged by the first ground of appeal is the target of that complaint.
48. It follows from this that the first ground of appeal must be rejected. The second ground of appeal
49. By their second ground of appeal, the appellants submit that the General Court erred in law in holding that they satisfied the criteria set out in Article 1(1) of Decision 2011/172 and Article 2(1) of Regulation No 270/2011, and the grounds given in the annexes to those acts for imposing restrictive measures against them in relation to funds held and their economic resources, and for including their names on the list annexed to each of those acts. The judgment under appeal
50. In view of the different wording of the English-language version of Article 1(1) of Decision 2011/172 as compared with that of other language versions, the General Court interpreted that provision in paragraphs 62 to 84 of the judgment under appeal. In the English-language version, Article 1(1) provides for the freezing of assets of ‘persons having been identified as responsible’, whereas the French-language version refers to persons having been ‘reconnues’ (found/recognised) as responsible for misappropriation.
51. In the light of the context and purpose of that provision, the General Court concluded, in paragraph 67 of the judgment under appeal, that it had to be interpreted broadly. In paragraphs 70 to 81 of that judgment, the General Court held that the principle that provisions imposing administrative penalties must be interpreted strictly did not preclude that interpretation. It made a similar finding, in paragraphs 82 to 84 of that judgment, with regard to the principle of the presumption of innocence.
52. Examining the grounds for the appellants’ inclusion in the list annexed to Decision 2011/172, the General Court compared the wording of those grounds in the various language versions of that decision. In paragraph 93 of the judgment under appeal, it noted that whichever language version was taken, the ground for listing was consistent with Article 1 of that decision, and found, in paragraph 94 of the judgment under appeal, that the English-language version of that annex was more consonant with the objective pursued by that article.
53. Relying, therefore, on the wording of Article 1(1) of Decision 2011/172 in its English-language version, the General Court found, in paragraph 95 of the judgment under appeal, that ‘the Council intended to freeze the applicants’ assets on the ground that they were subject to judicial proceedings in Egypt linked, in whatever form, to investigations concerning the misappropriation of State funds’. In paragraph 99 of that judgment, it concluded that, ‘in listing the applicants in the Annex to Decision 2011/172, the Council did not infringe the criteria which it had itself laid down in Article 1(1) of that decision’. Arguments of the parties
54. The appellants challenge, first of all, the General Court’s interpretation of Article 1(1) of Decision 2011/172 and Article 2(1) of Regulation No 270/2011. They submit that the General Court erred in law in accepting the English-language version of those provisions. They maintain that it is not the case that the English-language version is more consonant with the objective pursued by Decision 2011/172, and that the General Court ought to have reconciled the various language versions. The General Court was obliged to interpret those provisions by reference to the general scheme and the purpose of the rules. The appellants also challenge the General Court’s interpretation in paragraphs 85 to 95 of the judgment under appeal of the ground for including each of them in the annexes to Decision 2011/172 and Regulation No 270/2011.
55. The appellants submit that, in the light of those erroneous interpretations, the General Court failed to carry out the full and rigorous review of the evidence required by EU law. It acted only on the allegations contained in the request for judicial assistance, without verifying their accuracy. In particular, it did not take account of the first appellant’s argument that the complaint made against him was actually politically motivated and was unfounded. Similarly, the General Court did not examine the appellant’s assertions that his treatment in Egypt violated basic guarantees of due process and the rule of law.
56. According to the appellants, the General Court erred in law in ruling, in paragraph 99 of the judgment under appeal, that, in listing the appellants in the Annex to Decision 2011/172, the Council had not infringed the criteria which it had itself laid down in Article 1(1) of that decision.
57. That error is particularly evident as regards the second, third and fourth appellants. The General Court found, in paragraph 131 of the judgment under appeal, that none of the documents produced by the Council suggests that those appellants have been prosecuted in Egypt for the misappropriation of State funds. In relying on an association of those appellants with the first appellant, the General Court failed to have any regard to the judgment of the Court in Tay Za v Council (C‑376/10 P, EU:C:2012:138, paragraph 66) or to the judgment of the General Court in Nabipour and Others v Council (T‑58/12, EU:T:2013:640, paragraphs 107 and 108), under which only a natural person’s own involvement in activities to which the relevant legislation relates justifies the adoption of restrictive measures against him.
58. The Council’s view is that the General Court did not err in law in its interpretation of Decision 2011/172 and that, in any event, the question of the intention of the author of the act has been definitively resolved by the publication of a corrigendum to that decision.
59. As regards evidence of the existence of judicial proceedings against the first appellant, the Council refers to note verbale NV93/11ms by the Egyptian Prosecutor General, and to the fact that that appellant had acknowledged being subject to such proceedings in the application which he lodged before the General Court. The proceedings are not based on infringement of the United Nations Convention against Corruption, but the matters of which the appellant is accused by the Egyptian authorities correspond to the infringements described in that convention, particularly in Articles 17 and 18 thereof. Consequently, the grounds for inclusion in the list in the Annex to Decision 2011/172 correspond to the existence of judicial proceedings brought by the Egyptian authorities as reported by the first appellant himself.
60. The Council notes that the appellants do not state on what basis the Council or the General Court should have given consideration to the argument that the complaint against the first appellant was actually politically motivated. It observes, moreover, that the restrictive measures taken against him do not constitute a criminal sanction, so that the argument regarding a violation of due process and of the rule of law is not relevant.
61. As regards the second, third and fourth appellants, the Council emphasises that their listing in the Annex to Decision 2011/172 is not based on the fact that they were associated with the first appellant. It recalls in that regard that the General Court found, in particular in paragraph 97 of the judgment under appeal, that the appellants were listed on the sole ground that they were subject to judicial proceedings in Egypt linked to investigations concerning the misappropriation of State funds.
62. The Commission notes that the appellants do not contest paragraphs 57 to 84 of the judgment under appeal, in which the General Court interprets Article 1(1) of Decision 2011/172. It maintains that the General Court legitimately favoured a broad interpretation of that provision. The objective of freezing funds, namely to enable those funds to be recovered subsequently by the Egyptian government, could not have been achieved if it had been necessary to wait for the prosecution to be underway. Furthermore, the wording of Decision 2011/172 does not preclude that interpretation. Article 1(1) of Decision 2011/172 and Article 2(1) of Regulation No 270/2011 are aimed at persons having been identified as responsible for misappropriation of State funds and those ‘associated’ with them. Moreover, paragraph 2 of those articles prescribes a measure intended to ensure that the persons concerned do not circumvent the restrictive measures imposed on them. The Commission thus concludes that the ground for listing in the annexes to Decision 2011/172 and Regulation No 270/2011, namely being ‘subject to judicial proceedings’ cannot be interpreted as meaning that the persons concerned must be ‘criminally prosecuted’.
63. With regard to the evidence, the Commission emphasises that the Council was entitled to rely on the letters issued by the Egyptian authorities without verifying the merits of the arguments contained in those letters or deciding on the basis of the outcome of those proceedings. While, in respect of the first appellant, the Egyptian Prosecutor General’s request for judicial assistance referred to detailed facts relating, in particular, to ‘crimes of profiteering and intentionally harming public assets’, the same does not apply with regard to the second, third and fourth appellants. The reason why their funds were seized by the Egyptian authorities and frozen by EU acts is that those persons may, by virtue of their relationship with the first appellant, divert State funds or be used for that purpose. Furthermore, according to the information contained in those letters, the seizure of the funds of those appellants was subject to orders issued by the Prosecutor General and endorsed by the criminal court. The Council therefore communicated the relevant information on which the listings at issue were based.
64. As regards the full review of the grounds for listing required by the appellants, the Commission states that it is not for the Council to verify whether the Egyptian authorities ‘have a good case’ or to judge on the merits of the national case. The letters from the Egyptian authorities are appropriate information on which the Council could rely when adopting the restrictive measures.
65. Like the Council, the Commission contends that the reference to the Convention constitutes the legal basis of the request for assistance and cannot be understood as establishing the particular grounds for the judicial proceedings against the first appellant.
66. In conclusion, the Commission maintains that the criticism that the reasoning of the General Court was sparse does not reflect the judgment under appeal. It notes that the appellants do not challenge paragraph 67 of the judgment under appeal and do not take into account the detailed analysis of the General Court on defining the relevant criteria for inclusion in the list annexed to Decision 2011/172 (paragraphs 57 to 84 of that judgment); defining the ground for listing (paragraphs 85 to 95 of that judgment); and the legal characterisation of the facts (paragraphs 118 to 157).
67. Lastly, the Commission contends that the judgment in Tay Za v Council (EU:C:2012:138) is not relevant in this instance. That case concerned the son of a businessman who was associated with the rulers of Burma/Myanmar, and the measures taken against the regime of that third country were aimed at officials ‘who formulate, implement or benefit from policies that impede Burma/Myanmar’s transition to democracy’. In the present case, the aim is to preserve State funds for their future return to the Arab Republic of Egypt. Thus, the mere fact of being married to a person who has links with the rulers of a State does not imply an association with the political regime of that State. By contrast, that situation is relevant where restrictive measures are aimed at preserving State funds, since husbands and wives may own certain assets jointly. The very fact that orders were made in Egypt, even if these were not strictly necessary for including the second, third and fourth appellants on the lists annexed to Decision 2011/172 and Regulation No 270/2011, is a good indication of such an association, since the Egyptian courts have a better knowledge of the matrimonial regime applicable to the first appellant and his wives. Findings of the Court
68. By their second ground of appeal, the appellants challenge, in the first place, the General Court’s interpretation of the criteria for inclusion in the lists annexed to Decision 2011/172 and Regulation No 270/2011 and, in the second place, their listing in the light of those criteria and the reasons stated.
69. Contrary to what is submitted in the first place by the appellants, the General Court interpreted Article 1(1) of Decision 2011/172 and Article 2(1) of Regulation No 270/2011 taking into account the divergent wording of those provisions in the various language versions of Decision 2011/172 and Regulation No 270/2011, their context and their purpose.
70. The General Court did not err in law when, in paragraph 66 of the judgment under appeal, it identified the objective of those acts as being to assist the Egyptian authorities in their fight against the misappropriation of State funds. That objective is clear from recital 2 of Decision 2011/172.
71. Nor, in view of that objective, did the General Court err in law in holding, also in paragraph 66, that the effectiveness of Decision 2011/172 would be undermined if the adoption of restrictive measures were made subject to the criminal convictions of persons suspected of having misappropriated funds, since those persons would have enough time pending their conviction to transfer their assets to States having no form of cooperation with the Egyptian authorities.
72. The General Court correctly concluded, therefore, in paragraph 67 of the judgment under appeal, that Article 1(1) of Decision 2011/172 had to be interpreted as being directed not only at persons being prosecuted but also persons the subject of judicial proceedings connected to criminal proceedings for ‘misappropriation of Egyptian State funds’ who may on that basis be described as persons associated with the individuals the subject of those criminal proceedings.
73. Given the validity of that interpretation, the General Court was right in stating, in paragraph 93 of the judgment under appeal, that the ground on which the appellants were listed is consistent with Article 1(1) of Decision 2011/172, irrespective of the language version of that ground, and, in paragraph 94 of that judgment, that the English-language version is more consonant with the objective pursued by that provision. The General Court did not therefore err in law in concluding, in paragraph 95 of the judgment under appeal, that the Council intended to freeze the appellants’ assets on the ground that they were subject to judicial proceedings in Egypt linked, in whatever form, to investigations concerning the misappropriation of State funds.
74. The appellants challenge, in the second place, their inclusion in the lists annexed to Decision 2011/172 and Regulation No 270/2011 on the ground that it infringes Decision 2011/172. Although, as has just been stated in paragraph 72 of the present judgment, the appellants’ interpretation of that decision cannot be accepted, it is nevertheless appropriate to examine the arguments they put forward in that respect.
75. As regards the request for assistance made by the Egyptian authorities, it must be noted that this is examined, in particular, in paragraphs 128 to 134 and 137 of the judgment under appeal. In paragraph 128 of that judgment, the General Court found that that request referred to an investigation carried out by the Egyptian Prosecution General in respect of the four appellants regarding, inter alia, crimes of corruption and usurping of public assets. In paragraph 133 of that judgment, the General Court noted that the appellants had not produced any evidence such as to cast doubt on the accuracy of the information entered on that request for assistance. Similarly, it stated that the appellants had not disputed the existence of an order of the Egyptian Prosecutor General for seizure of their assets, which had been endorsed by a criminal court. As regards the first appellant specifically, in paragraphs 130 and 137 of the judgment under appeal the General Court examined one of the documents annexed to the request for assistance and found that the first appellant was ‘accused’, in ‘[Case No] 38 for the year 2011’, of ‘usurping the assets’ of a ‘public sector company with State-owned shares’ and of ‘committing crimes of profiteering and [intentionally] harming public assets, as well as usurping and … facilitating the usurpation of [such] assets’.
76. In those circumstances, since the appellants do not dispute the existence of the request for assistance and the documents annexed to it or of the order relating to the seizure of their assets, the General Court cannot, contrary to their submissions, be accused of having failed to carry out a full and rigorous review of that evidence.
77. It should be emphasised in that regard that it was not for the Council or the General Court to verify whether the investigations to which the appellants were subject were well founded, but only to verify whether that was the case as regards the decision to freeze funds in the light of the request for assistance. So far as concerns the findings of fact made by the General Court with regard to the existence of judicial proceedings concerning the four appellants, it must be borne in mind that the Court of Justice has consistently held that the General Court has exclusive jurisdiction, first, to find the facts except where the substantive inaccuracy of its findings is apparent from the documents submitted to it and, secondly, to assess those facts. Save where the evidence adduced before the General Court has been distorted, the appraisal of the facts therefore does not constitute a point of law which is subject as such to review by the Court of Justice (see, in particular, judgments in Versalis v Commission , C‑511/11 P, EU:C:2013:386, paragraph 66, and Telefónica and Telefónica de España v Commission , C‑295/12 P, EU:C:2014:2062, paragraph 84).
78. With regard to the first appellant, the appellants are in fact seeking a reassessment of the evidence without invoking any distortion of that evidence by the General Court, in so far as they argue that the Egyptian authorities’ request for judicial assistance, as described notably in paragraphs 128, 130 and 137 of the judgment under appeal, does not provide evidence that the first appellant is being prosecuted in Egypt and, in particular, that the General Court erred in law in finding that a judicial investigation was underway in respect of the first appellant for misappropriation of State funds in his capacity as a former member of the Egyptian Parliament. That argument must therefore be declared inadmissible.
79. The appellants’ argument that there is no evidence that the order was made in respect of the ‘misappropriation of State funds on the basis of the United Nations Convention against Corruption’ must also be rejected, since it is apparent from the request for assistance itself that the first appellant is being prosecuted in Egypt and that the Egyptian authorities have indicated that the Convention is the legal basis of the request for assistance, referring, inter alia, to Articles 17 to 19, 23 and 31 thereof.
80. As regards the second, third and fourth appellants, while the General Court recognised, in paragraph 131 of the judgment under appeal, that none of the documents suggested that those appellants had been prosecuted in Egypt for the misappropriation of State funds, it found, in paragraph 132 of that judgment, that their assets had been seized pursuant to an order of the Egyptian Prosecutor General which was endorsed by a criminal court and was linked to investigations concerning the misappropriation of State funds.
81. As to the appellants’ argument that the seizure of their assets in Egypt does not prove that there are judicial proceedings against the second, third and fourth appellants, suffice it to recall that that seizure was ordered by the Egyptian Prosecutor General and endorsed by a criminal court, which must be considered judicial bodies. The appellants’ argument that that seizure was merely preventative is unfounded, given that that seizure was ordered by the judicial authorities and the preventative nature of a measure does not divest it of its judicial character.
82. The General Court did not, therefore, err in law when it concluded, in paragraph 134 of the judgment under appeal, that the Council had not erred in fact or in its legal characterisation of the facts in describing the second, third and fourth appellants, in the Annex to Decision 2011/172, as persons subject to judicial proceedings in Egypt linked to investigations concerning misappropriation of State funds.
83. The appellants also invoke the political objective of the complaint made against the first appellant, and his treatment in Egypt contrary to the rule of law. However, they do not specify the plea before the General Court to which the General Court is said to have failed to respond, or show in what respect the General Court made an error of law.
84. The appellants submit, lastly, that the General Court should, when reviewing the entries on the lists annexed to Decision 2011/172 and Regulation No 270/2011, have taken into consideration the natural persons’ own involvement in carrying out the acts covered by the relevant legislation. It should be noted, however, that the criterion laid down in Article 1(1) of Decision 2011/172, under which all funds and resources of persons or entities having been identified as responsible for misappropriation of Egyptian State funds are to be frozen, must be interpreted as meaning that the existence of judicial proceedings connected to criminal proceedings for misappropriation of State funds may be accepted as a basis for restrictive measures, without there being any need to describe the personal involvement of the person concerned. It follows from this that the case-law invoked by the appellants and mentioned in paragraph 57 of the present judgment is not relevant.
85. In the light of all the foregoing, the second ground of appeal must be rejected. The third ground of appeal Arguments of the parties
86. By their third ground of appeal, the appellants maintain that the General Court erred in law in holding that the Council had complied with its obligation to state reasons in Decision 2011/172 and Regulation No 270/2011.
87. They submit that the Council gave just one reason for including them on the lists annexed to those acts, that reason being identical for each of them, namely that they were each ‘subject to judicial proceedings by the Egyptian authorities in respect of the misappropriation of State funds on the basis of the United Nations Convention against Corruption’. In their view, that reason is vague and fails to identify the ‘actual and specific’ reasons for imposing restrictive measures on them. The lack of precision in the statement of reasons adopted by the Council is compounded by the significant disparities in the language versions of Decision 2011/172 and Regulation No 270/2011, and deprives the appellants of the ability to defend their rights in the best possible conditions.
88. The Council notes that the appellants do not explain in what way the General Court allegedly erred in law by upholding the validity of the wording of the grounds for listing. In any event, the appellants have obtained all the documents relevant for their defence.
89. It notes, moreover, that this is the first time that the appellants have invoked the difficulties generated by the disparities between the language versions of Decision 2011/172 and Regulation No 270/2011. It observes that the appellants have always used English during the proceedings, so that it is difficult to see how the reference to the English-language version of the contested measures would have prevented them from defending their rights in the best possible conditions.
90. The Commission contends that the statement of reasons for those acts was sufficient. Findings of the Court
91. The General Court did not err in law in paragraphs 107 to 109 of the judgment under appeal when it recalled the case-law relating to statements of reasons for acts and, more specifically, for acts imposing restrictive measures such as the freezing of assets.
92. After reviewing the references relating to the legal basis of Decision 2011/172 and Regulation No 270/2011 in paragraph 113 of the judgment under appeal, it established, in paragraph 114 of that judgment, that the considerations of fact that were the basis for the Council’s decision to freeze assets were sufficiently detailed to enable the appellants to challenge their correctness before the Council and then before the Courts of the European Union. In paragraph 115 of that judgment, it established that those considerations were not stereotypical in nature but sought to describe the situation of the appellants.
93. The General Court did not err in law when it held, in paragraph 116 of the judgment under appeal, that Decision 2011/172 and Regulation No 270/2011 contain a statement of the points of law and facts on which, according to the Council, those acts are based, and that their wording discloses in a clear fashion the Council’s reasoning.
94. The third ground of appeal must therefore be rejected. The fourth ground of appeal Arguments of the parties
95. By their fourth ground of appeal, the appellants maintain that the General Court erred in law in holding, in paragraphs 158 to 185 of the judgment under appeal, that the appellants’ rights of defence and right to effective judicial protection had not been infringed.
96. According to the appellants, the General Court erred in holding that Decision 2011/172 and Regulation No 270/2011 were sufficiently reasoned. It also failed to give any consideration to the fact that the appellants did not receive a copy of the request for judicial assistance until four months after that decision and regulation were adopted, that is after the date on which the action was brought before the General Court. They submit that the information provided in the letter of 29 July 2011 is incomplete. The General Court failed to assess whether the facts accepted by the Council and underpinning the grounds for including the appellants on the lists annexed to those acts had been established. The General Court’s determination that the listing of the second, third and fourth appellants was lawful was based on a reason that differed from that given by the Council.
97. The Council contends that the appellants have not established in what respect they were prevented from exercising in full their rights of defence and their right to effective judicial protection, since they were able to bring an action for annulment within the legally prescribed period, and, in the context of that action, contested exactly the same documents as those provided to them in response to their requests for information after the adoption of Decision 2011/172 and Regulation No 270/2011.
98. The Council and the Commission note that the General Court found, in paragraphs 164 and 165 of the judgment under appeal, that the Council had communicated to the appellants the documents necessary for their defence. The appellants do not contest those paragraphs of the judgment under appeal.
99. As regards the other arguments, the Council submits that it has already responded to those in the context of the other grounds of appeal. Findings of the Court
100. In paragraphs 158 to 185 of the judgment under appeal, to which the fourth ground of appeal relates, the General Court replied to three separate arguments put forward by the appellants.
101. First of all, in paragraphs 159 to 166 of the judgment under appeal, the General Court ruled that the appellants’ argument that the evidence on the basis of which their assets were frozen was not communicated to them had no basis in fact. Paragraphs 164 and 165 of the judgment under appeal, by which the General Court finds that the Council had communicated to the appellants the documents necessary for their defence, are worded as follows: ‘164 First, the documents in the file before the Court show that, by a letter of 7 June 2011 …, the Council replied to the request of 1 April 2011, stating that it was referring the applicants to a document “dated 13 February 2011 from the Egyptian Ministry of Foreign Affairs with a request by the Egyptian Prosecutor General to freeze the assets of certain former Ministers and officials, based on the United Nations Convention against Corruption, and which includes [the first applicant] on the list of persons concerned”. That document dated 13 February 2011 was enclosed with the Council’s letter. 165 Secondly, by a letter of 29 July 2011 referred to in paragraph 125 above, the Council replied, inter alia, to the letter of 13 May 2011. In the letter of 29 July 2011 it referred the applicants’ lawyers not only to the “information … already communicated … in the Council’s previous letter of 7 June 2011”, but also to a “communication … from the Egyptian Mission to the E[uropean] U[nion] dated 24 February 2011, enclosing a request for judicial assistance from the Egyptian Prosecutor General”. That communication together with the request for judicial assistance, described in paragraphs 126 and 128 above respectively, were enclosed with the Council’s letter of 29 July 2011.’
102. Since the appellants have not pleaded distortion of the facts or of the evidence, the fourth ground of appeal must, in accordance with the case-law cited in paragraph 77 of the present judgment, be declared inadmissible in so far as it relates to paragraphs 159 to 166 of the judgment under appeal.
103. Next, in paragraphs 167 to 170 of the judgment under appeal, the General Court rejected the appellants’ argument concerning the failure to state reasons for Decision 2011/172 and Regulation No 270/2011.
104. In that regard, it has already been held, in paragraph 93 of the present judgment, that the General Court did not err in law when it held that the reasons for those acts were stated to the requisite legal standard. Accordingly, the fourth ground of appeal must be rejected as unfounded in so far as it relates to paragraphs 167 to 170 of the judgment under appeal.
105. Lastly, in paragraphs 171 to 185 of the judgment under appeal, the General Court rejected a number of arguments put forward by the appellants to demonstrate that their right to effective judicial protection had been infringed. In the context of the present ground of appeal, the appellants allege that the General Court did not take into account the fact that they were provided with a copy of the request for judicial assistance, the principal piece of evidence on which Decision 2011/72 and Regulation No 270/2011 are based, on 29 July 2011, more than four months after those acts were adopted. Consequently, the appellants are of the view that the Council did not reply to them ‘in sufficient time’, contrary to the General Court’s assessment in paragraph 182 of the judgment under appeal.
106. Suffice it to note that the appellants did not rely on that argument before the General Court and, as a result, are not entitled to rely, at the stage of the appeal, on the existence of an error of law on the part of the General Court in that respect.
107. The fourth ground of appeal must therefore be rejected. The fifth ground of appeal Arguments of the parties
108. By their fifth ground of appeal, the appellants maintain that the General Court erred in law in holding that the interference with their property and/or freedom to conduct a business was proportionate.
109. The General Court did not, they submit, examine the possibility of applying measures less onerous than the restrictive measure in order to achieve the desired objectives. It merely stated in paragraph 207 of the judgment under appeal that the appellants had not proved that the Council could envisage adopting measures that were less onerous than but as appropriate as those provided for in Decision 2011/172 and Regulation No 270/2011. Nor, moreover, did the General Court consider the position of each of the appellants individually. Had such errors not been made, the only conclusion available to the General Court would have been that the restrictive measures at issue constituted a disproportionate interference with the appellants’ property and/or freedom to conduct a business.
110. The Council notes that the General Court addressed the proportionality of the measures at length in paragraphs 187 to 217 of the judgment under appeal. Furthermore, it was not necessary for the position of each of the appellants to be considered, since the restrictive measures in question do not constitute a punishment for any suspected or proved wrongdoing and therefore do not need to be adapted to the behaviour of the persons subjected to them. The Council states in this regard that neither before the General Court nor before the Court of Justice did the appellants invoke any circumstances that would justify such differentiated treatment. Therefore, they are wrong to claim that the General Court erred in not taking an argument into account, since no such argument was ever submitted to it. Findings of the Court
111. According to settled case-law, an appeal must indicate precisely the contested elements of the judgment which the appellant seeks to have set aside and the legal arguments specifically advanced in support of the appeal (see, in particular, judgments in France v Monsanto and Commission , C‑248/99 P, EU:C:2002:1, paragraph 68, and Inuit Tapiriit Kanatami and Others v Parliament and Council , C‑583/11 P, EU:C:2013:625, paragraph 46).
112. The appellants have not put forward any legal argument to establish the existence of an error of law in paragraphs 205 to 209 of the judgment under appeal, in which the General Court reviewed the proportionality of the restrictive measures at issue. The appellants merely challenge the General Court’s reason - stated in paragraph 207 of the judgment under appeal and recalled in paragraph 109 of the present judgment - for finding that the appellants had not adduced evidence proving that it was possible to adopt less onerous measures, and do not even attempt to show that they submitted such evidence to the General Court.
113. As regards the personal position of each of the appellants, suffice it to note that the validity of their inclusion in the lists annexed to Decision 2011/172 and Regulation No 270/2011 was reviewed by the General Court in its reply to the fourth plea of the action for annulment. It should be noted in that regard that the General Court referred to Article 1(3) of Decision 2011/172, according to which the competent authorities of the Member States may, under certain conditions, in any given case authorise that certain frozen funds or economic resources be released or be made available. Article 4 of Regulation No 270/2011 contains a similar provision. Having regard to the specific objective of the freezing of funds in relation to all the appellants (namely to immobilise assets likely to become part of the appellants’ estates following the misappropriation of State funds to the detriment of the Egyptian authorities), to the temporary and reversible nature of the measures, to which reference is made in paragraph 209 of the judgment under appeal, and to the fact that those provisions allow certain funds to be released in any given case, the General Court was not obliged to review the proportionality of the restrictive measure in relation to each appellant.
114. It follows from this that the fifth ground of appeal must be rejected as in part inadmissible and in part unfounded. The sixth ground of appeal Arguments of the parties
115. By their sixth ground of appeal, the appellants submit that the General Court erred in law in holding that the Council had not made a manifest error of assessment.
116. The General Court considered, in paragraphs 235 and 236 of the judgment under appeal, that the Council had complied with the criteria set out in Article 1(1) of Decision 2011/172 and Article 2(1) of Regulation No 270/2011. Furthermore, as is apparent from paragraph 237 of that judgment, the Council’s arguments ‘presuppose[d] that it was for the Council to ascertain whether they were criminally liable for misappropriation of Egyptian State funds’.
117. The Council and the Commission contend that a reply to those arguments has already been given in the context of the other grounds of appeal. Findings of the Court
118. It must be noted that the appellants refer back to the arguments they put forward in support of the second ground of appeal, and thus call into question the General Court’s assessment of the validity of their inclusion in the lists annexed to Decision 2011/172 and Regulation No 270/2011. Since that assessment by the General Court has been upheld by the Court of Justice in its examination of the second ground of appeal, it follows that the sixth ground of appeal must be rejected as unfounded.
119. Since all the grounds of appeal have been rejected, the appeal must be dismissed. Costs
120. In accordance with Article 184(2) of the Rules of Procedure of the Court of Justice, where the appeal is unfounded, the Court is to make a decision as to the costs.
121. Under Article 138(1) of those rules, which apply to the procedure on appeal 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.
122. Since the Council and the Commission have applied for costs and the appellants have been unsuccessful, the appellants must be ordered to pay the costs.